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Willingness to pay for electricity access in extreme poverty: Evidence from sub-Saharan Africa

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  • Sievert, Maximiliane
  • Steinbuks, Jevgenijs

Abstract

Improving electricity access in low-income countries is complicated because of high service costs and low electricity consumption levels in rural areas. This study elucidates this problem by analyzing poor Sub-Saharan African households’ willingness-to-pay for different types of electricity access, including both grid and lower cost off-grid technologies. We show both theoretically and empirically that at low levels of income, low-cost decentralized off-grid solar technologies provide the highest utility from the households’ perspective. We, therefore, recommend concentrating the near-term rural household electrification efforts on these technologies.

Suggested Citation

  • Sievert, Maximiliane & Steinbuks, Jevgenijs, 2020. "Willingness to pay for electricity access in extreme poverty: Evidence from sub-Saharan Africa," World Development, Elsevier, vol. 128(C).
    • Handle: RePEc:eee:wdevel:v:128:y:2020:i:c:s0305750x1930508x
    DOI: 10.1016/j.worlddev.2019.104859
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    More about this item

    Keywords

    Electricity access; Extreme poverty; Sub-Saharan Africa; Willingness-to-pay;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

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