Elsevier

Energy Policy

Volume 36, Issue 6, June 2008, Pages 2016-2029
Energy Policy

Assessment of access to electricity and the socio-economic impacts in rural areas of developing countries

https://doi.org/10.1016/j.enpol.2008.01.041Get rights and content

Abstract

The purpose of this study is to reveal relations between access to electricity and advancement in a socio-economic condition in rural areas of developing countries. Recently, multi-dimensional aspects of poverty, for example, economy, education, and health, has been increasingly focused on, and access to modern energy such as electricity is one possible solution. As a case study, we have analyzed unelectrified rural areas in Assam state, India. We have developed an energy-economic model in order to analyze the possibility of electrification through dissemination of electric lighting appliances as well as applied multiple regression analysis to estimate the socio-economic condition, a literacy rate above 6 years old, in the areas. As a result of the case study, the household electrification rate, the 1000 km2 road density, and sex ratio have been chosen as the explanatory variables of the literacy rate. Moreover, the model analysis shows that complete household electrification will be achieved by the year 2012. In combination with the multiple regression and model analysis, the literacy rate in Assam may increase to 74.4% from 63.3%.

Introduction

Poverty is a major obstacle for sustainable development of not only developing countries but also the entire world. It has been the main objective of the bilateral and multi-lateral donors, together with economic growth. Nowadays, poverty is defined as low attainment of social condition, for example, education, health, and nutrition in addition to economic deprivation. One way to cope with this multi-dimensional aspects of poverty is to promote opportunity (World Bank, 2001), and one of the opportunities is access to modern energy such as electricity. In many literatures related to condition of energy consumption in rural areas of developing countries, the term “energy access” is used to refer to the situation where people can secure the modern energy, which is commonly consumed in developed countries, at affordable prices (Bhattacharyya, 2006, Bhattacharyya, 2006; Spalding-Fecher et al., 2005). The definition of the term “energy poverty” is, then, the situation in which energy access is not established yet (Pachauri et al., 2004; Sagar, 2005).

Works dealing with developmental issues from the field of energy can be mainly divided into three categories, and their characteristics and references are the following:

  • Descriptive study (Aggarwal and Chandel, 2004; Bastakoti, 2003; Dung et al., 2003; Gangopadhyay et al., 2005; Rehman et al., 2005)—It describes current situations of energy demand or consumption as well as policy and program in developing countries. It also investigates critical components of the policy and programs, and evaluates the outcomes. Although it includes various aspects of the policy and programs such as legal, social, and fiscal, most of the study is qualitative evaluation, which is highly case-oriented, and it is difficult to obtain ideas applicable to other areas.

  • Experimental study (Bhattacharya et al., 2002; Chakrabarti and Chakrabarti, 2002; Masera et al., 2000; Wijayatunga and Attalage, 2002)—It tests technological or economic efficiency of devices or appliances in order to compare technologies adopted by rural households. It measures not only the data of energy demand, consumption, and expenditure but also emissions of hazardous pollutants, which cause indoor pollution. Although it contains highly disaggregated or highly precise data, policy implication to promote these technologies is not sufficiently discussed based on the results.

  • Analytical study (Bailis et al., 2005; Biswas et al., 2001; Howells et al., 2005; Mathur et al., 2003; Pachauri et al., 2004; Parikh and Ramanathan, 1999)—It analyzes energy demand or consumption structure of a developing country, and applies an analytical tool to energy demand and supply structure at village, regional, and national level, taking into account economic and technological parameters. It contains model analysis, which is divided into top-down and bottom-up modeling approaches. Moreover, it can incorporate emissions associated with energy consumption such as greenhouse gas emissions and government policies, for example, environmental tax.

There are a large number of literatures for the descriptive and experimental studies. In contrast, there are a limited number of researches categorized as the analytical study. In particular, few researches estimate socio-economic effects of results of analyses. Given that nowadays poverty is regarded as a lack of socio-economic welfare, it is unavoidable to consider socio-economic impacts of transition or improvement of energy sources consumed in developing countries. With respect to this point, the model analysis with a bottom-up modeling approach, in combination with the estimation of socio-economic aspects, has a potential to reveal the links between energy access improvement and poverty eradication as shown in the previous work of the authors (Kanagawa and Nakata, 2007). Therefore, we have developed an energy-economic model with bottom-up modeling approach and applied it to rural areas of developing countries in order to clarify the possibility of energy access improvement. Furthermore, socio-economic impacts are incorporated into the analysis.

Section snippets

Energy and Human Development Index (HDI)

Energy influences socio-economic condition of developing countries as shown in Fig. 1. In particular, access to modern energy like electricity will drastically improve the quality of life of those who do not have yet. There has also been increasing attention on poverty reduction through energy access improvement among international organizations in the energy field. For example, recently the International Energy Agency (IEA) has been focusing on the topic through the improvement of energy

Definition of energy access improvement

In the study, energy access improvement is defined as “electrification in analyzed areas through dissemination of electric lighting appliances such as incandescent bulbs, fluorescent tubes, and Compact Fluorescent Lamps (CFL) instead of using kerosene lamps.”

Procedure of the analysis

The procedure of the analysis of lighting demand is the following:

  • 1.

    Select a socio-economics factor related to energy consumption for lighting by multiple regression analysis; a literacy rate above 6 years old.

  • 2.

    Design an energy-economic model

Multiple regression analysis

As a result of the multiple regression analysis, the following three explanatory variables are selected to estimate a literacy rate above 6 years old in India: household electrification rate, road density per 1000 km2 in logarithm, and sex ratio. This result is shown in Table 6.

From 19 observations including 18 states and one UT, the regression equation attains the adjusted coefficient of determination of 0.743. All of the explanatory variables affect the literacy rate positively, and it is

Discussion

The model analysis we have conducted is based on reliable electricity supply and secured availability of lighting devices on the supply side as well as decision making by the rural household, which takes present value of the devices into account, on the demand side. However, in reality, lack of infrastructure and capacity of supply prevents rural areas from achieving energy access improvement. Moreover, electric lighting appliances are not adopted because of their higher initial investment in

Conclusion

In the study, it is aimed to reveal relations quantitatively between access to electricity and advancements in socio-economic condition in rural areas of developing countries. As reported in previous works, energy access improvement including electrification has huge impacts on such factors as health, education, economy, etc. Rural households in developing countries adopt kerosene lamps in order to meet their lighting demand. They do not obtain sufficient luminance for studying in a house at

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