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The Global Electrification Frontier and Climate Change

Author

Listed:
  • Burgess, Robin

    (Department of Economics, LSE)

  • Greenstone, Michael

    (Department of Economics, University of Chicago)

  • Ryan, Nicholas

    (Department of Economics, Yale University)

  • Sudarshan, Anant

    (Department of Economics, University of Warwick)

Abstract

Off-grid solar promises a low-cost and carbon-free path to electrification. But will poor households choose off-grid power? We run a multi-year pricing experiment in rural India to estimate demand over all electricity sources, including off-grid solar, diesel generators, and both formal and informal connections to the grid. We find that off grid solar is an important stop-gap, but households value grid electrification five times more. The grid, however, decreases global surplus, both because household payments do not cover the cost of supply, in an environment with high informality, and because grid connections increase carbon damages. We apply our model to data from Africa and find a similarly strong preference for the grid among households there, underscoring the external validity of our results.

Suggested Citation

  • Burgess, Robin & Greenstone, Michael & Ryan, Nicholas & Sudarshan, Anant, 2026. "The Global Electrification Frontier and Climate Change," CAGE Online Working Paper Series 814, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:814
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp814.2026.pdf
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    Cited by:

    1. is not listed on IDEAS
    2. Meeks, Robyn C. & Thompson, Hope & Wang, Zhenxuan, 2025. "Decentralized renewable energy to grow manufacturing? Evidence from microhydro mini-grids in Nepal," Journal of Environmental Economics and Management, Elsevier, vol. 130(C).
    3. Cem Yavuz & Zafeer Ravat & María Daniela Anda León & Sanghwa Lee & Paulo Fernandes & Quinn Reifmesser & Frederick Elliott Gaved & Samantha Pilato & Constanza Gonzalez Parrao & Birte Snilstveit, 2025. "Improving Energy Access, Climate and Socio‐Economic Outcomes Through Off‐Grid Electrification Technologies: A Systematic Review," Campbell Systematic Reviews, John Wiley & Sons, vol. 21(3), September.
    4. Jamil, Faisal & Islam, Tanweer Ul, 2023. "Outage-induced power backup choice in Pakistan," Utilities Policy, Elsevier, vol. 82(C).

    More about this item

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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