Model
Background/ Rationale :
Realising the intimate relation between rural electrification and
private sector development the Johannesburg Plan of Implementation
(JPOI) called for the international community to work together at
all levels “to improve access to reliable and affordable energy
services … sufficient to facilitate the … goal of halving
the proportion of people living in poverty by 2015.” However,
vis-à-vis this agreement governments face serious challenges.
For one, the resources needed to achieve rural electrification in
sub-Saharan Africa are enormous. In Kenya, for example, nationally,
15% of households and only 2% of rural households were connected
to the national grid in 2000.
A primary reason for the low rural connection rate to the national
electricity grid is cost. According to the Kenyan Government, the
average cost of selling 1 kWh to rural customers ranges from 12.4
Ksh to 32.4 Ksh. The Kenya Power and Lighting Company (KPLC) currently
sells electricity to all its customers (urban or rural) at 8.2 Ksh
per kWh, or 4.2 to 24.2Ksh below these costs. In other words, it
makes a loss developing rural networks. To increase efficiency and
achieve faster electrifications, the government of Kenya, like many
others across the world, has liberalized the market for electricity
generation and distribution. Yet few private investors have shown
interest in rural electrification.
The cost of typical alternative energy sources used in rural
areas
Poor households and communities typically rely on traditional biomass
for heating and cooking, and use paraffin or candles for lighting.
The real cost of energy sources such as wood or paraffin are comparably
high relative to those of electricity or gas delivered to wealthier
households through national networks.
In 2007, economists and anthropologists from the University of Quebec
at Montreal (UQAM) carried out a baseline socio-economic and feedback
survey of 3100 REAM project members. As shown in Table 1 further
below, the results reflect substantial expenditures on various typical
energy sources in rural households.
Moreover, these energy sources have high non-monetary costs. When
women and children spend many hours collecting fire wood or dung
for heating and cooking, they have less time for other valuable
things such as education. The use of traditional energy sources
can also have serious health consequences. Women, often responsible
for cooking, are especially at risk of developing smoke induced
respiratory illnesses. Related, heavy reliance on wood for energy
needs can lead to serious environment degradation.
Table 1: Expenditures
on various typical energy sources in rural households.
Monthly Expenses/ HH:
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