Elsevier

Journal of Cleaner Production

Volume 94, 1 May 2015, Pages 130-136
Journal of Cleaner Production

Fuel switching in slum and non-slum households in urban India

https://doi.org/10.1016/j.jclepro.2015.01.072Get rights and content

Highlights

  • Drivers of fuel switching were estimated in non-slum and slum households.

  • The changes in fuel use patterns were consistent with the energy ladder theory.

  • Fuel prices, urban amenities, and educational levels were found to be drivers for changing fuel usage.

  • Improvement in physical and social capitals enhance modern fuels uptake.

  • Differential fuel subsidies based on socio-economic characteristics were proposed.

Abstract

Improving access to modern fuels is essential in developing countries for reducing adverse human health and environmental impacts caused by traditional fuels. Fuels use in developing countries is heterogeneous across households. This paper estimates drivers of fuel switching in non-slum and slum households in urban India, using a discrete choice model on a nationally representative micro data. The choices considered are three categories of cooking fuels: traditional – firewood, dung, crop residue and coal/charcoal; modern – kerosene and liquefied petroleum gas (LPG); and mixed fuels. The results suggest that the patterns of fuels use are consistent with the energy ladder theory in urban India. In addition to income, the major determinants of modern fuels uptake are fuels prices, access to electricity and water supply, and education attainment. The increasing price of LPG affects the willingness to change fuels for low-income non-slum and the high-income slum households negatively. The analyses make a strong case for applying differential subsidies on modern fuels employing multidimensional aspects of poverty. Moreover, there is a need for partial diversion of existing fuels subsidies on improving physical and social capitals, which will result in uptake of modern fuels, particularly among disadvantaged communities.

Introduction

Modern fuels – kerosene and liquefied petroleum gas (LPG) – are the major share (over 65%) of cooking energy in urban1 India. However, a large number of households, mostly disadvantaged, such as low-income and slum2 dwellers, still use traditional fuels – firewood, dung, crop residue, coal or charcoal. In comparison to modern fuels, traditional fuels adversely affect local indoor environment, which often result in poor health outcomes, particularly among women and children (de Koning et al., 1985, Holdren et al., 2000, Jerneck and Olsson, 2013, McMichael et al., 2000, Smith, 1993). The use of traditional fuels is thermally inefficient and diverts substantial fuel carbon to product of incomplete combustion, whose energy commitment per meal is high (Smith et al., 2000). It also depletes forest covers, as much of the firewood tends to come from illegal logging (Gautam and Herat, 2000), accentuating climate change and biodiversity loss. Fuel switching has several benefits, thus an example of ‘development with co-benefits’ (Puppim de Oliveira, 2013, Smith and Haigler, 2008).

The household fuel choices depend upon three factors. The first is availability and access to fuels, the second is affordability, as determined by household income, and the third is policy options available, such as prices, subsidies, and taxes. Some of these factors are aggravated with spatial location of the household. In rural India, for instance, freely available traditional fuels and poor access to modern fuels discourage the use of LPG or kerosene as primary cooking fuel, even among high-income households. Similarly, slum dwellers largely use traditional fuels because of inadequate access to modern fuels and poor socio-economic conditions. Thus, specific conditions influence domestic energy patterns. Previous studies focus on urban and rural households, but silent about slum dwellers. This was the motivation to investigate similarity (or difference) in domestic energy patterns and switching factors between slum and non-slum households in urban areas. The large size of slum dwellers, about 65 million (17.2% of urban Indian), provide further impetus for such analyses (NBO, 2010). Thus, evidence-based interventions in slums can contribute to the environmental sustainability and improve quality of life, an important target under the Millennium Development Goals (Moreno, 2003).

The major contribution of this paper is to bring forth debates of cooking fuels switching of slum dwellers in the literature and practice. This study analyses the intra-urban differences among the different urban residents (slum and non-slum). Earlier studies on fuel shifting have focused mostly in urban or rural areas, or a comparison of both (Farsi et al., 2007, Heltberg, 2004, Rao and Reddy, 2007), but hardly any study has attempted to understand the large intra urban differences among different urban areas, which is important for policy design for transition to modern fuels in all urban households. Since the socio-economic characteristics vary significantly between different urban inhabitants (Table 1), identical policy interventions may not work effectively for all. Another contribution of this study is establishing linkage between energy security and multidimensional aspects of urban deprivations. This study recognizes multiple cooking fuels used by the household and not limit to primary (or secondary) cooking fuel as often considered in earlier studies (Rao and Reddy, 2007, van der Kroon et al., 2013). Thus, we grouped household fuel use in three groups – only traditional, only modern and mixed – and analyze accordingly.

The results reveal cooking fuels consumption patterns are consistent with the energy ladder theory in slum and non-slum households. In addition to income, prices of modern fuels, access to urban amenities (electricity and water supply), and educational attainment are the major determinants for opting modern fuels. Available policy intervention to promote uptake of modern fuels are the subsidies in fuels prices, where every Indian household is entitled for 12 subsidized cooking gas cylinders (14.2 Kg) in a year, while ‘eligible’ household is also entitled for a fixed amount of kerosene from the public distribution system (PDS). These subsidies are mistargeted and financially unsustainable. Departing from existing subsidy regime, this study recommends two major policy interventions: employing differential subsidies on modern fuels based on multidimensional aspects of poverty; and partially diverting existing subsidy to improve physical and social capitals, which would also improvised slums.

The rest of the paper organizes as following. Section 2 presents brief review of the literature and Section 3 presents data and descriptive statistics. Section 4 discusses estimations methods of fuel choice model. Section 5 presents estimation of results and Section 6 concludes with policy implications of the results.

Section snippets

Previous studies

Previous studies related to cooking fuels have focused on the patterns of fuel use, determinants of fuel switching, and demand assessment for fuels in developing economies. Recently studies also focuses on exploring efficient stoves and converting available solid fuels into biomass gasification (Purohit, 2009). These studies are descriptive and empirical in nature, where, descriptive studies primarily present patterns of fuels use (Alam et al., 1998, Reddy and Srinivas, 2009), while empirical

Data source and descriptive statistics

This study uses micro data derived from the Indian Human Development Survey, conducted by the National Council of Applied Economic Research (NCAER), New Delhi and University of Maryland, covering entire urban India during the period November 2004 to October 2005 (Desai et al., 2010). The sample survey consists of 13,126 urban households, using stratified random sampling, from 971 urban blocks. Empirical analysis uses only 5763 non-slum and 669 slum households because of missing values of some

Model and estimation methods

Literature review reveals that most of the studies presume energy ladder theory for fuel choices (Fig. 2) and use of multinomial logit model. This model similar to theory of traditional innovation for any technology adaptation has distinct levels of ladder – learning, growth, saturation and declination (Heltberg, 2004, Hosier and Dowd, 1987, Masera et al., 2000). In early stage, households use traditional fuels, then mixed and finally modern fuels (Fig. 2). Typically the user move step by step

Results and discussions

Table 2 presents results of the multinomial logit regressions of fuel switching in non-slum and slum households. The results estimate predictors of fuel switching to only traditional and only modern fuels on the base of mixed fuels. The models also include odd ratio to add interpretations. All models are without sampling weights and slum model do not use state dummy due to small sample size. To enhance our understanding about the substitution patterns amongst three forms of cooking fuels,

Conclusion and policy implications

This paper presents the results of discrete choice models on fuel choices, and patterns of cooking fuels, using a nationally representative dataset of urban slum and non-slum households. The empirical analyses determine the responsiveness of fuel choices on fuels prices, income, access to urban amenities, and socio-demographic characteristics, among others. This research differs from previous studies in the following aspects: focuses on intra-urban differences (slum and non-slum), and considers

Acknowledgements

The authors wish to thank the following people and the organizations: the Japan Society for the Promotion of Science (JSPS) for supporting the work of S. Ahmad through Grants-in-Aid for Scientific Research; the School of Planning and Architecture, Vijayawada (SPAV), and the Mercator Research Institute on Global Commons and Climate Change (MCC), Berlin, where S. Ahmad was affiliated while revising the manuscript; Prof. Manmohan Kapshe, Dr. Ping Jiang, and anonymous reviewers for their

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