an analysis of energy and income trends following rural

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AN ANALYSIS OF ENERGY AND INCOME TRENDS FOLLOWING
RURAL ELECTRIFICATION IN THE STATE OF BAHIA, BRAZIL
Martin Obermaier, PPE/COPPE/UFRJ, Phone +55 (21) 2562-8760, E-mail [email protected]
Overview
Brazil has made considerable efforts to increase electrification levels among the rural poor during the past years.
However, as development analysts frequently point out, electricity access is no commodity itself which can help
decrease poverty. Rather than that, the value of electricity for, say, a rural family is only derived from the
demand for the goods or services electricity provides or makes possible. Successful electrification programs
must thus simultaneously tackle the issues of (1) universalizing access and (2) enabling consumers to increase
their consumption. Such an observation implicitly takes into account rural equity considerations, as all new
electricity consumers ought to benefit from a new connection, and not only rural elites or large-scale users.
Today much research is available on the potential benefits of rural electrification, but little empirical work has
been carried out to validate these. This paper presents a contribution to the latter field of research by analyzing
the distributional trends of electricity consumption and income following rural electrification in the State of
Bahia, Brazil.
Methods
I estimate simple non-parametric density curves to analyze how electricity consumption and income develop
after rural households have received access to electricity. The data is taken from a recent panel survey covering
268 rural families in Bahia over the time of three years.
Results
In general the analysis of the data shows that (1) rural consumers tend to take up electricity consumption
following rural electrification, and that (2) low consumption levels decrease in favor of higher consumption
levels. Results are less clear regarding rural income: while median family income increases, low per capita
incomes become more frequent at the end of the survey period. On any account, due to the limited time covered
by the data set it is not possible to establish a direct relationship between electricity consumption and income
generation.
Conclusions
Based on panel survey data from 268 rural Brazilian families, my analysis shows that electricity consumption
and at least family income increase and become more equally distributed in the years following rural
electrification. Most changes, however, occur only on a small scale. These results may seem disappointing, but
as the incremental benefits of one additional kWh or dollar are generally considered to be higher for the poor, the
significance of these findings should not be underrated.
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