Participatory Management (PM) Approach for Achieving Rural Electrification

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Roughly 1 billion people worldwide do not have access to electricity and 87% of this unelectrified population lives in rural areas. The rural population is scarcely distributed and has low income and low energy demand as compared to the urban population.[1] Because of these qualities, the transactional cost of providing electricity and collecting fees per person in the rural areas, are high for the electricity utility. Therefore, this paper looks into participatory management (PM) approach for achieving rural electrification and reducing transactional cost. It looks into the advantages and constraints of using PM approach and includes a case study from Nepal.

Participatory Management (PM) Approach

Hagara Kija community Participation

Participatory Management (PM) is a process where decision making is shared equally among employees who are hierarchically unequal.[2] A distinction should be made between the decision-making process and the decision itself. The decision-making process takes the participatory approach into account by involving all the actors, but the final decision is taken by the superior authority.[3] This model assumes that people are likely to modify their behavior when they are involved in not only carrying out the decisions made but also in the process of problem analysis and solution.[4] This model is characterized by: decentralized, community-driven, socially inclusive policies and decisions as well as flexible leadership style.[5]

Under this model, a village energy community is created to manage the energy project. This community can represent either a single village or a cluster of village and may and may not be a registered authority. The community can then decide to either take an active role i.e. be involved in operation, monitoring and oversight of the project or a passive role i.e. role limited to supervision of the energy project and overall monitoring.[6]

Strengths: PM approach ensures the representation of all relevant stakeholders in the community including the marginalized groups such as women, aboriginal people, migrants and other minorities. This increases the knowledge base and makes it easy to incorporate the knowhow of the rural community, esp. their energy needs and demand into the project. Finally, involving the community fosters local ownership, commitment and accountability. These qualities are helpful for the long-term success of the project.[5]

Constraints: To ensure adequate participation of all the relevant stakeholder, huge resources (monetary, human resource, time etc.) is required and involving all the stakeholder also elongates the process and makes decision-making process longer. Similarly, involving the marginalized communities does not equate in equal participation and special attention should be paid so that their voices are heard.[5] Also for the long-term success of the model, proper training and support should be provided to the community (at least in the initial phase).6 It might not always be clear who provides this training: the target community or other stakeholders.

Therefore, PM approach has its own pros and cons while using for rural electrification. It should be noted that rural electrification involves different technologies such as grid extension, solar home systems and mini-grids. For technologies such as grid extension or mini-grids, which require collaboration between target communities and other stakeholders, PM approach could be a cost-effective option. The case study from Nepal further highlights the role of PM approach in community grid electrification.

Case Study: Community Rural Electrification Program (CREP) in Nepal

Nearly 40% of rural households in Nepal are deprived of electricity. Grid extension to rural areas are economically not feasible so private companies are hesitant to invest in this sector. Therefore, the Nepalese Electricity Authority (NEA) launched the Community Rural Electricity Program (CREP) program in 2003/2004.[7]Under the CREP program, the target village which wants to connect to the grid forms a legal entity called Community Rural Electrification Entity (CREE). The CREE then submit an official request to NEA. Once the request is accepted, CREE contributes 20% of the cost and NEA covers the rest (80%) for grid extension. Once the grid is extended, CREE buys the electricity in bulk from NEA and sells it to the community. THE CREE is also responsible for maintaining the grid infrastructure from the village point onwards. As of December 2017, 47 CREEs have been connected to the grid providing electricity to over 34,014 households.[8]

Strengths: By involving the community from the inception, there is more accountability and also ensures the long-term sustainability of the project. The community is also responsible for managing the grid, billing the customers and collecting tariff from the consumers. This reduces the operational cost for NEA.[8]

Weakness: CREE is responsible for managing the grid but NEA claims that the grid belongs to it. This has created friction between CREE and NEA.8 For the long-term sustainability of CREE, regular training of the CREE staffs is required, which might not always be available. It is also not clear who should provide the training: the CREEs or NEA?


As explained in this paper, PM approach is especially handy if you already have a community and have an energy technology that requires community participation such as mini-grids. However, it is necessary to establish clear property rights and also share of duties (especially with respect to the management of the technology and training of new staffs). Overall, involving the community is a great way to ensure the long-term sustainability of the project.

This paper only looked into PM approach but there are other business models for rural electrification such as private-government model, cooperatives model and many more. Hence, there is a need to look into other models to see in what context PM approach is the better option and how it can be combined with other models.

Further Information


  1. Custodian Agencies for Sustainable Development Goal. Tracking SDG7: The energy progress report [Internet]. 2017 [cited 2018 Jun 1]. Available from:
  2. Shagholi R, Hussin S. Participatory management: an opportunity for human resources in education. Procedia - Soc Behav Sci. 2009 Jan 1;1(1):1939–43. (This paper looks in PM approach in educational institution using multidimensional approach.)
  3. McConkey DD. Participative management: What it really means in practice. Bus Horiz. 1980 Oct 1;23(5):66–73. (This paper talks about the misconceptions associated with PM approach and focuses on how to implement PM approach.)
  4. Reese GD. An examination of the role of participatory management in academic special collections departments. Libr Leadersh Manag. 23(4):161–7. (This paper also looks in detail about PM approach and what are the challenges for implementing PM in any organization.)
  5. 5.0 5.1 5.2 Towards participatory environmental management? J Environ Manage. 2001 Nov 1;63(3):269–79. (It looks into the use of PM approach in environmental projects and discusses their effectiveness in such projects.)fckLRfckLR
  6. P R K, Palit D. Participatory business models for off-grid electrification. In: Green Energy and Technology. 2013. p. 187–225. (It includes a comparison of different business models including PM for rural electrification in South-Asian countries.)
  7. Power to the people: Breakthrough in micro-hydro prospects | UNDP in Nepal [Internet]. UNDP. [cited 2018 May 13]. Available from: (A short article about rural electrification in Nepal using micro-hydro.)
  8. 8.0 8.1 Community Rural Electrification Programme (CREP) Nepal - [Internet]. [cited 2018 Jun 1]. Available from: (Article about the CREP program in Nepal, implement by the Nepalese Electricity Authority.)