The purpose of this document is to undertake a rapid desk based study to identify evidence on institutional/political considerations linking large scale energy investments and economic growth to inform a  DFID research project.

The review finds a huge literature on the topic political economy and energy. The relative dearth of “academic literature” on some of these issues is amply made up with the literature from “practitioners”. The conventional wisdom now frequently explains the relative lack of progress in the world of energy sector reform, the rationalisation of prices and subsidies, and the desired shift to low carbon energy in terms of the constraints of ‘political economy’ rather than due to other more traditional explanations. All energy systems, whether predominantly in the public or private sector, need some form of regulation and are subject to important tax and subsidy regimes, all of which are associated with lobbying, rent seeking and winnersand losers.

The literature is reviewed covering:

political economy and fossil fuels, (including oil and the “resource curse”, coal, and fossil fuel subsidies)
the political economy of power sector reform (including feed in tariffs, and power pools)
the political economy analysis of low carbon growth
the energy mix and the shift to renewables, and
the political economy of energy “access” and the distribution of energy services (including energy and gender).

The energy sector does not appear to present particular challenges for political economy analysis methods, even so valuable research could be undertaken to push the methodological frontier in the application of political economy analysis and related methods.