Productive Use of Energy for Rural Development

INTRODUCTION

There is almost unanimous agreement that energy plays a pivotal role in national development. Generally, there is a high degree of correlation between energy use, economic growth, and level of development. In the context of rural development, the traditional view of the productive use of energy is that it is associated primarily with the provision of motive power for agricultural and industrial or commercial uses. For example, motors are used to grind grain, operate power tools, irrigate farmland, and facilitate many commercial activities. It was believed that the motive power made possible by electricity would result in tremendous productivity gains and economic growth, thus transforming the underdeveloped rural landscape. In other words, the emphasis has been on the direct income-generating uses of energy. The traditional concept of productive uses of energy for rural development needs to be revised for primarily two reasons. First, there is a growing realization that although energy is a necessary condition for rural development, it is insufficient by itself to bring about the desired socioeconomic impact. Second, there is a significant shift in the understanding of what is meant by rural development, especially in the context of the Millennium Development Goals (MDGs) used by the major donors and international development agencies. The MDGs emphasize not just poverty reduction in terms of income, but they also highlight the importance of improved health, universal primary education, women’s empowerment, and gender equality. The very goals of development are to raise incomes of the poor and also to ensure that they are educated and healthy, and treated equally. Thus, an enhanced understanding of what is a productive use of energy must take into account not only the direct impact of energy on raising incomes, but also the indirect impacts that energy can have on education, health, and gender issues.

TRADITIONAL VIEWOF PRODUCTIVE USES OF ENERGY

For rural development, energy was, and in some cases still is, looked at as having two distinct uses: residential and productive. Residential uses of energy are expected to positively impact the rural quality of life or improve rural living standards (1, 2). The productive use of energy in rural areas is expected to result in increased rural productivity, greater economic growth, and a rise in rural employment, which would not only raise incomes but also reduce the migration of the rural poor to urban areas. With respect to agricultural production, electricity would be used principally to provide motive power for agriculture-based industries and would power farm machinery, such as water pumps, fodder choppers, threshers, grinders, and dryers. Thiswould result in the modernization of agricultural production. Electricitywould bring an increase in irrigation, which in turn would result in an increase in the amount of required labor. The generous output of these modernized farms would provide inputs to large commercial enterprises such as rural cooperative sugar factories. Another example includes the use of electricity as a source of driveshaft power and lighting, which is suitable for rural industries, for example, machine shops. In the past, a common belief was that once a rural region was provided with electrical service and access to modern energy, rural industries would expand and the quality of rural products would improve. Over the long run, the availability of modern energy services would provide significant indirect social benefits such as greater equity and improved quality of life. In short, if energy was used for productive applications, itwould transform an underdeveloped agrarian economy. Not surprisingly, the process has proved to be more complicated (3–5). One example of this is India. India has a long history of supporting rural electrification for productive uses, in recognition of the potential benefits for the country in terms of poverty alleviation and food self-sufficiency. A major component of India’s rural electrification program since the late 1960s has been to promote electricity for irrigation pumping by heavily subsidizing agricultural electricity rates (6, p. 13). Since then, 13 million pump sets have been put in use for irrigation by Indian farmers. Partly owing to the high prices of other pumping alternatives such as diesel, and partly owing to the constrained capacity of the State Electricity Boards, today there are substantial waiting lists for irrigation pump-set connections in most Indian states. Thus, this program in India has been relatively successful in promoting productive uses—particularly in the form of irrigation. However, electricity use by households has not kept pace with its use for irrigation pumping, and it is estimated that only about 44% of rural households actually have electricity in their homes. Bangladesh, by contrast, has witnessed a more balanced approach toward rural electrification. The rural electrification program in Bangladesh stressed both residential as well as productive uses of energy and has met with reasonable success (7, 8). Lack of adequate electricity for households has important gender implications as well. Because agriculture and cultivation are usually male domains (with homes being female domains), the traditional definition of productive use of energy has an inherent gender bias (9). This bias is evident in the rural marketplace as well. Even in rural areas where households have access to electricity, markets stock leisure items such as televisions and radios but not labor-reducing modern cooking appliances for women. Because men serve as the decision makers in households, the market tends to cater to their needs over women’s (10). In Indonesia, a survey of a relatively wealthy rice-growing region found that the rate of growth of pump sets was low and that most irrigation continues to be successfully accomplished through traditional, gravity-fed methods. Furthermore, the price of kerosene and diesel in Indonesia was heavily subsidized, making it less attractive for those farmers who used diesel pumps to switch to electricity. Thus, experience suggests that there are many different ways to promote productive uses of energy. This has important consequences not only in shaping the program but also in producing the types of benefits needed for rural areas.