Starting a Non-Farm Enterprise to Escape Energy Poverty: Household Level Evidence from Rural West Africa

The choice of cooking fuel is a critical economic and health decision for rural households, with significant implications for well-being and environmental sustainability. This paper examines whether rural non-farm entrepreneurship promotes the adoption of cleaner cooking fuels, specifically liquefied petroleum gas (LPG). Using large, nationally representative data from eight WAEMU countries – Benin, Burkina Faso, Côte d'Ivoire, Guinea-Bissau, Mali, Niger, Senegal, and Togo – we apply econometric techniques to address endogeneity and selection bias. Our findings show that households engaged in non-farm entrepreneurial activities are significantly more likely to adopt LPG. We further show that non-farm entrepreneurship enhances financial inclusion by improving access to microfinance, mobile banking, and informal savings groups (ROSCAs), thereby easing liquidity constraints that limit investments in clean energy. These results suggest that promoting rural non-farm enterprises, along with expanding financial services and infrastructure, can effectively reduce energy poverty and improve health outcomes in sub-Saharan Africa.