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Determinants of Household Fuel Choice in Major Cities in Ethiopia

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  • Mekonnen, Alemu
  • Köhlin, Gunnar

Abstract

This paper looks at the fuel choice of urban households in major Ethiopian cities, using panel data collected in 2000 and 2004. It examines use of multiple fuels by households in some detail, a topic not much explored in the household fuel-choice literature in general, and in sub-Saharan Africa in particular. The results suggest that as households’ total expenditures rise, they increase the number of fuels used, even in urban areas, and they also spend more on the fuels they consume (including charcoal but not wood). The results also show that even fuel types such as wood are not inferior goods. The results support more recent arguments in the literature (using Latin American and Asian data) that multiple fuel use (fuel stacking) better describes fuel-choice behavior of households in developing countries, as opposed to the idea that households switch (completely) to other (more expensive but cleaner) fuels as their incomes rise. This study shows the relevance of fuel stacking (multiple fuel use) in urban areas in sub-Saharan Africa. While income is an important variable, the results of this study suggest the need to consider other variables such as cooking and consumption habits, dependability of supply, cost, and household preferences and tastes to explain household fuel choice, as well as to recommend policies that address issues associated with household energy use.

Suggested Citation

  • Mekonnen, Alemu & Köhlin, Gunnar, 2008. "Determinants of Household Fuel Choice in Major Cities in Ethiopia," Discussion Papers dp-08-18-efd, Resources For the Future.
  • Handle: RePEc:rff:dpaper:dp-08-18-efd
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    File URL: http://www.rff.org/RFF/documents/EfD-08-18.pdf
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    References listed on IDEAS

    as
    1. Heltberg, Rasmus, 2005. "Factors determining household fuel choice in Guatemala," Environment and Development Economics, Cambridge University Press, vol. 10(03), pages 337-361, June.
    2. Kebede, Bereket & Bekele, Almaz & Kedir, Elias, 2002. "Can the urban poor afford modern energy? The case of Ethiopia," Energy Policy, Elsevier, vol. 30(11-12), pages 1029-1045, September.
    3. Davis, Mark, 1998. "Rural household energy consumption : The effects of access to electricity--evidence from South Africa," Energy Policy, Elsevier, vol. 26(3), pages 207-217, February.
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    Cited by:

    1. Gebreegziabher, Zenebe & Mekonnen, Alemu & Kassie, Menale & Köhlin, Gunnar, 2012. "Urban energy transition and technology adoption: The case of Tigrai, northern Ethiopia," Energy Economics, Elsevier, vol. 34(2), pages 410-418.
    2. Brew-Hammond, Abeeku, 2010. "Energy access in Africa: Challenges ahead," Energy Policy, Elsevier, vol. 38(5), pages 2291-2301, May.
    3. Karimu, Amin & Mensah, Justice Tei & Adu, George, 2016. "Who Adopts LPG as the Main Cooking Fuel and Why? Empirical Evidence on Ghana Based on National Survey," World Development, Elsevier, vol. 85(C), pages 43-57.
    4. Alem, Yonas & Beyene, Abebe D. & Köhlin, Gunnar & Mekonnen, Alemu, 2016. "Modeling household cooking fuel choice: A panel multinomial logit approach," Energy Economics, Elsevier, vol. 59(C), pages 129-137.
    5. Mensah, Justice Tei & Adu, George, 2015. "An empirical analysis of household energy choice in Ghana," Renewable and Sustainable Energy Reviews, Elsevier, vol. 51(C), pages 1402-1411.
    6. Mohammad Z. Hasan & Ronald A. Ratti, 2015. "Coal Sector Returns and Oil Prices: Developed and Emerging Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 5(2), pages 515-524.
    7. Guta, Dawit Diriba, 2014. "Effect of fuelwood scarcity and socio-economic factors on household bio-based energy use and energy substitution in rural Ethiopia," Energy Policy, Elsevier, vol. 75(C), pages 217-227.
    8. Mengistu, M.G. & Simane, B. & Eshete, G. & Workneh, T.S., 2015. "A review on biogas technology and its contributions to sustainable rural livelihood in Ethiopia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 48(C), pages 306-316.
    9. Stephan Klasen & Tukae Mbegalo, 2016. "The Impact of Livestock Ownership on Solar Home System Adoption in the Northern and Western Regions of Rural Tanzania," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 218, Courant Research Centre PEG.
    10. Dacuycuy, Connie B., 2017. "Energy Consumption, Weather Variability, and Gender in the Philippines: A Discrete/Continuous Approach," Discussion Papers DP 2017-06, Philippine Institute for Development Studies.
    11. Fidelis O. Ogwumike & Uchechukwu M. Ozughalu & Gabriel A. Abiona, 2014. "Household Energy Use and Determinants: Evidence from Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 4(2), pages 248-262.
    12. van der Kroon, Bianca & Brouwer, Roy & van Beukering, Pieter J.H., 2013. "The energy ladder: Theoretical myth or empirical truth? Results from a meta-analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 20(C), pages 504-513.
    13. Arega, Tiruwork & Tadesse, Tewodros, 2017. "Household willingness to pay for green electricity in urban and peri-urban Tigray, northern Ethiopia: Determinants and welfare effects," Energy Policy, Elsevier, vol. 100(C), pages 292-300.
    14. repec:eee:enepol:v:114:y:2018:i:c:p:234-244 is not listed on IDEAS
    15. Manning, Dale T. & Taylor, J. Edward, 2014. "Migration and fuel use in rural Mexico," Ecological Economics, Elsevier, vol. 102(C), pages 126-136.
    16. Abubakar Hamid Danlami & Rabiul Islam & Shri Dewi Applanaidu, 2015. "An Analysis of the Determinants of Households’ Energy Choice: A Search for Conceptual Framework," International Journal of Energy Economics and Policy, Econjournals, vol. 5(1), pages 197-205.
    17. Guta, Dawit Diriba, 2012. "Application of an almost ideal demand system (AIDS) to Ethiopian rural residential energy use: Panel data evidence," Energy Policy, Elsevier, vol. 50(C), pages 528-539.
    18. van der Kroon, Bianca & Brouwer, Roy & van Beukering, Pieter J.H., 2014. "The impact of the household decision environment on fuel choice behavior," Energy Economics, Elsevier, vol. 44(C), pages 236-247.

    More about this item

    Keywords

    Household fuel; urban; Ethiopia;

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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