Implications of alleviating unreliable electricity supply for energy poverty: Evidence from households in Benin

Energy poverty in Sub-Saharan Africa extends beyond access to electricity as it encompasses issues of affordability and reliability. In mitigating the adverse effects of frequent power outages and voltage fluctuations — that exacerbate financial burdens and hinder the ability to meet basic energy needs — households in this region often incur extra costs by relying on generators, voltage stabilizers and other alternative sources. Using Benin as a case study, this research examines the economic and poverty implications of these extra costs. By analyzing data from a national household survey, we assess how defensive expenditures—such as investments in power generators and voltage stabilizers—impact energy poverty. Our findings show that these additional costs make up a significant fraction (38 %) of household electricity expenditure, with the operating cost of power generators being the largest component. Importantly, 44 % of households are considered energy poor due to these extra expenses, a factor often overlooked in traditional energy poverty metrics. Using the probit regression model, we identify wealth status, homeownership, planned blackouts, and other factors, that significantly explain energy poverty measured with or without extra cost. Our results underscore the necessity of incorporating extra costs into energy poverty assessments to accurately identify affected households and design targeted interventions. This study contributes to the literature by highlighting the critical role of electricity reliability in energy poverty and providing policymakers with insights to develop more effective energy poverty alleviation strategies in Sub-Saharan Africa.