Transcript 170. Kerapeletswe - International Association for Impact

Impact of Household Income on
Energy Patterns in Botswana:
Implications for Economic Growth and
Forest Biodiversity Conservation.
Charity K. Kerapeletswe
Botswana Institute for Development Policy Analysis (BIDPA)
Objectives of Study
 To establish fuel-specific consumption patterns of
income groups in Botswana
 To assess the effect of increase in household income
on household energy consumption patterns
 Investigate whether the energy ladder hypothesis apply to
households in Botswana
 To establish factors that contribute to choice of energy
sources in Botswana and assess implications for forest
biodiversity and economic growth
Theoretical Background
 The energy–economic growth (GDP) relationship - energy is an
input in the growth and development process (Reddy, 1998;
 Studies from developing countries generally reveal that the that
households climb the energy ladder as their income increases (Jack,
2004; Barnes et al.,1998; Davis, 1998)
 Bardhan et al (2002) provide evidence from Nepal that suggests that
households may not climb the energy ladder if supplies of cleaner
fuels are lacking
 Some studies of forest use have demonstrated that demand for
biomass energy especially firewood, have direct relationship with
household income up to an income threshold level, after which
households switch cleaner fuels. (Chaudhuri and Pfaff, 2003;
Rosenzweig and Foster, 2003; Leach, 1992).
Methodology
 Household Energy Consumption Survey
in 2006
1500 urban households
 Area classified as urban if 75% of inhabitants
derive livelihood from non-agricultural sources
1000 rural households
Data analysis employs descriptive statistics
and econometric models
Botswana Background
2006
2004
2002
2000
1998
1996
 eroding the previous social
development achievements
 Contributing to increase in
incidence of poverty through loss
of household bread winners
1994

12
10
8
6
4
2
0
-2
1992

Economic Performance
1990

Often hailed as Africa success
story of economic growth-one of
the poorest in 1966; middle
income by 1997
Narrow economic base (mining –
more than 30% of GDP)
High unemployment of about
24%
High incidence of HIV/AIDS
(32.4% in 2006)
Growth Rate

Botswana Settlement Patterns
100
Percent
80
60
Urban
40
Rural
20
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
0
•Increase in urban population may increase demand for energy given the energy-intensive lifestyles
•There the may be increased energy switching from biomass to cleaner energy sources
Head Count Ratio (1985-2006)
60
Percent (%)
50
40
30
20
10
0
1985-86
1993-94
2002-03
2005-06
48.21
37.21
32.89
30.2
Poverty and Rural/Urban Split
 Incidence of poverty is high in
rural areas
 Incidence of poverty is more
than 20% in urban areas
except in Jwaneng (mining
town; 3.16) and Gaborone
(capital city; 6.79%)
(2003); And 30.2% (2006)
Gini Coeficient
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
1998
2000
2002
2004
2006
Skewed income distribution
poorest 40% of the population receiving 12% of total income
middle 40% receive 29% of total income and
richest 20% receive 59% of total income.
2008
Botswana Energy Policy Framework
NDP7
(1991-1997
BEMP 1996
(1985-1996)
NDP8
(97/98-2002/03)
Vision 2016
(1997)
NDP9
(2003/042008/09)
BEMP 2004
Energy policy
2005
•National Development Plans 7-9 and Botswana Energy Master Plan (BEMP of 2004)
emphasize rural electrification
•Vision 2016 seeks to expand electricity to all by 2016
Botswana Energy Policy
Electricity Generation
Figure 4.5 Electricity Supplied(1995-2005)
2500000
amount of electricity(MW)
2000000
1500000
local generation
Import Demand
1000000
500000
0
1994
1996
1998
2000
2002
2004
2006
years
Botswana Power Corporation has sole responsibility for power generation
Ratio of local generation to imports is 25:75 percent
% consumption
Final Energy Consumption by Sector
total Energy Consumption
45
40
35
30
25
20
15
10
5
0
H
ld
o
eh
s
ou
commercial energy consumption
rt
o
sp
n
tra
g
in
n
i
M
G
t
en
nm
r
e
ov
e
d
a
Tr
d
an
H
ls
e
ot
g
in
r
u
ct
a
uf
n
a
M
re
tl u
u
ic
r
Ag
Sectors
•Household sector is the biggest energy consumer of energy
•Major source of energy for household sector is non-commercial
C
n
tc i o
tru
s
on
Preliminary Findings
Energy and economic growth in Botswana
GDP Per Capita (US$)
7000
2006
6000
2005
2004
5000
2003
4000
2002
3000
2001
2000
1000
0
0
500
1000
1500
2000
Household Energy Consumption per capita (kWh)
2500
Household Energy
Consumption in Botswana
 Sources of Energy
for Households in
2006
 Fuelwood
 Liquid Petroleum Gas
(LP Gas)
 Electricity
 Households spend 24%
of household income on
energy
100
90
80
70
60
50
40
30
20
10
0
Series1
fuelwood
LPG
Electricity
66
23
22
%of connected households
Household Connection to
National Electricity Grid
20
15
Rural
Urban
10
Total
5
0
1981
1996
1997
1998
1999
2000
2001
2002
2003
Year
•At national level only 22% of households are connected to electricity
•43.3% of urban households are connected to national grid
•17.1% of rural households are connected to national grid
Fuel Use Patterns by Income Group
Use of Electricity for Cooking by
Income Group
8
% of households
7
6
5
4
3
2
1
0
Electricity
Q1
Q2
Q3
Q4
Q5
Total
0
0
0
1.9
7.3
2.1
Use of Fuelwood for Cooking by
Income Group
70
% of households
60
50
40
30
20
10
0
Fuelwood
Q1
Q2
Q3
Q4
Q5
Total
66
48
37
33
18
40
Use of Gas for Cooking by Income
Group
80
% of households
70
60
50
40
30
20
10
0
Gas
Q1
Q2
Q3
Q4
Q5
Total
22.6
42.9
52.5
63.9
70.5
50.5
Factors that Influence Energy Choice
10 0
% of households
90
1
2
3
80
4
70
60
5
50
40
30
20
10
0
Household
Income
Household Energy Consumption
Choice
90
Access to
Cost of energy
energy
alternatives
infrastructure
85
70
Household
size
Cultural
factors
40
65
Preliminary conclusions

Increase in income (GDP per capita) increase energy consumption per capita – this may
not directly increase demand for cleaner energy sources due




Households in Botswana are multiple energy users; with fuelwood and gas being used to
energy intensive uses (e.g. cooking)


Skewed income distribution which limits poor households in switching from fuelwood use to
commercial fuels
High unemployment rate due to undiversified economy limit household income generating capacity
and hence switch to commercial fuels
High incidence of poverty and HIV/AIDS limit ability of households to expand income sources and
switch to commercial fuels
Rural electrification program adds electricity to household energy portfolio without promoting
energy switching due to high tariffs
Electricity is hardly used for energy intensive uses even among households which are
connected to national grid



Electricity is used mainly for lighting and powering media
Only the 1.9% and 7.1% of the fourth and fifth quintiles respectively use electricity for cooking
There is limited access to electricity especially in rural areas and this limits its use

There is some energy switching fuelwoodl and gas at a threshold of P24000 annual
income and above

The choice of energy source is influenced by multiple of factors but household income
dominates
Implications for Forest Conservation
and Economic Growth

Increase in energy consumption resulting from increase in economic growth is
likely to put pressure on forest resources
 There localized forest degradation around urban centers
 Responding to shortage of fuelwood people resort to cutting life trees forgoing other
forest benefits
 Increased use of fuelwood has implications for health through indoor pollution

Forest conservation measures should be associated with poverty reduction
measures as well as target different income groups

Limited use to commercial fuels limit economic growth and rural development
 Small and medium enterprises (SME) that are usually initiated at house level require
energy infrastructure
 SME have potential to catalyze rural development
 Employment creation
 Poverty alleviation

Without adequate infrastructure and improvement in wellbeing of households,
SME potential contribution to economic and social development is constrained
 There need to expand the rural electrification program
 Improve uptake of economic support programs to facilitate SME development