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Energy poverty reduction by fuel switching. Impact evaluation of the LPG conversion program in Indonesia

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  • Andadari, Roos Kities
  • Mulder, Peter
  • Rietveld, Piet

Abstract

In low- and middle-income countries, Liquefied Petroleum Gas (LPG) can be an attractive alternative to the widespread use of traditional kerosene. Not only is LPG a relatively clean, safe and cost-effective fuel for households, its large-scale adoption also reduces the heavy burden of kerosene consumption subsidies on government budgets. Against this background, we evaluate the impact of a large government program to substitute LPG for kerosene in Indonesia. Using a household survey across urban, suburban and rural regions we find that this program was very effective in causing a large scale shift from kerosene to LPG. This shift was positively influenced by level of education, household size and household income. Contradicting the energy-ladder model, the LPG program, reinforced by an increase in the price of kerosene, led to increased stacking of fuels, including increasing consumption of both electricity and traditional biomass. In addition, our analysis shows that the LPG program failed to substantially reduce the overall number of energy-poor people, but it has been effective in alleviating extreme energy-poverty. Finally, we find that medium and higher income households in suburban areas benefitted most from the LPG program.

Suggested Citation

  • Andadari, Roos Kities & Mulder, Peter & Rietveld, Piet, 2014. "Energy poverty reduction by fuel switching. Impact evaluation of the LPG conversion program in Indonesia," Energy Policy, Elsevier, vol. 66(C), pages 436-449.
  • Handle: RePEc:eee:enepol:v:66:y:2014:i:c:p:436-449
    DOI: 10.1016/j.enpol.2013.11.021
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    Citations

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    Cited by:

    1. Jean Hugues Nlom & Aziz A. Karimov, 2015. "Modeling Fuel Choice among Households in Northern Cameroon," Sustainability, MDPI, Open Access Journal, vol. 7(8), pages 1-11, July.
    2. Kimemia, David & Van Niekerk, Ashley, 2017. "Cookstove options for safety and health: Comparative analysis of technological and usability attributes," Energy Policy, Elsevier, vol. 105(C), pages 451-457.
    3. repec:gam:jeners:v:10:y:2017:i:12:p:1942-:d:120151 is not listed on IDEAS
    4. Sutar, Kailasnath B. & Kohli, Sangeeta & Ravi, M.R. & Ray, Anjan, 2015. "Biomass cookstoves: A review of technical aspects," Renewable and Sustainable Energy Reviews, Elsevier, vol. 41(C), pages 1128-1166.
    5. Lee, Soo Min & Kim, Yeon-Su & Jaung, Wanggi & Latifah, Sitti & Afifi, Mansur & Fisher, Larry A., 2015. "Forests, fuelwood and livelihoods—energy transition patterns in eastern Indonesia," Energy Policy, Elsevier, vol. 85(C), pages 61-70.
    6. Sadath, Anver C. & Acharya, Rajesh H., 2017. "Assessing the extent and intensity of energy poverty using Multidimensional Energy Poverty Index: Empirical evidence from households in India," Energy Policy, Elsevier, vol. 102(C), pages 540-550.
    7. repec:eee:energy:v:126:y:2017:i:c:p:513-526 is not listed on IDEAS
    8. Cheng, Chao-yo & Urpelainen, Johannes, 2014. "Fuel stacking in India: Changes in the cooking and lighting mix, 1987–2010," Energy, Elsevier, vol. 76(C), pages 306-317.
    9. repec:eee:enepol:v:107:y:2017:i:c:p:188-196 is not listed on IDEAS
    10. Malla, Sunil & Timilsina, Govinda R, 2014. "Household cooking fuel choice and adoption of improved cookstoves in developing countries : a review," Policy Research Working Paper Series 6903, The World Bank.

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