Impact of Energy Accessibility to Household Welfare in Developing Countries: Case Study Rwanda

Abstract

Nowadays, the world’s socio-economic development and well-being of society are based on energy accessibility. As the number of energy accessors increases some global problems have been highlighted including climate change and global warming. Those problems lead the developing countries including Rwanda to food insecurity and poverty. Easily accessible energy in Rwanda is biomass energy which occupies above 83% of the total energy consumption. Electrification and green energy like solar and gas energy are considerably increasingly accessed by Rwandans. Those clean energies are mostly available in the cities compared to the rural villages. Industries and other businesses are located in the city due to the energy accessibility, and youth are shifting from rural areas to the cities to look for jobs and a civilized way of living. Therefore, in this study, we assessed and analysed the impact of energy accessibility on the household’s welfare. The econometric approach method with Integrated Household Living Conditions Survey 5 (EICV5) has been used to assess the country’s level of energy access and the impact of energy access on the households ‘welfare is identified. We used simple regression analysis's ordinary least squares test (OLS) to analyze those impacts. The data from the National Institute of Statistics Rwanda that are treated using STATA software show that access to electricity affects a household’s welfare generally increasing. From the coefficient estimates, the non-farm business increased by 68.4% in rural areas. In the education sector, there is an impact of clean energy accessibility which has 52.6%. Therefore, the general consideration of the impact of energy accessibility impact to the household’s welfare plays an important role at a rate of 68% in people’s way of living in both rural areas and cities of Rwanda.

Keywords

• energy
• household
• electricity
• econometrics
• socio-economy