Improving the Expansion of Electricity Services Considering Affordability Issues: A Case Study in Brazilian Low-Income Households

Abstract

The assurance of universal access to electricity refers to not only physical access to electricity, heating, and/or cooling services but also making them affordable to families. This is the case in Brazil, where physical electricity access reaches more than 99% of the urban population, but a high proportion of households are disconnected due to lack of payment. Affordability is a key factor in planning the expansion and maintenance of the electricity grid. In this paper, therefore, we propose the development of a strategy, called the Payment Capability Indicator (PCI), that provides new information about the relationship between energy cost and family income. The classic indicator, the Ten Percent Rule (TPR), was the base, and empirical research was conducted in two low-income neighborhoods in Paraná state, southern Brazil. The results consider variables that add new information to guide local public policies, combining interventions to improve affordability, energy efficiency, alternatives to energy services and consumer behavioral changes.

Keywords

• energy poverty
• sustainable development goals
• capability approach
• econometric models