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Energy Policy 36 (2008) 2674– 2684

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Energy Policy
journal homepage: www.elsevier.com/locate/enpol

And then they lived sustainably ever after?—Assessment of rural


electrification cases by means of indicators
Elisabeth Ilskog a,, Björn Kjellström b
a
Royal Institute of Technology, S-136 40 Haninge, Sweden
b
Luleå University of Technology, SE-97187 Luleå, Sweden

a r t i c l e in f o a b s t r a c t

Article history: Increasing the current low level of access to electricity in developing countries is important for
Received 15 September 2007 economic development and poverty eradication. Encouraging the involvement of new actors for
Accepted 12 March 2008 implementation of rural electrification projects is a relatively new policy. At the same time, it is required
Available online 12 May 2008
that the projects contribute to sustainable development. It is therefore of interest to investigate
Keywords: whether, for instance, private sector involvement can contribute more to some aspects of sustainability
Sustainability Indicators than the conventional approach where rural electrification is the responsibility of a government utility.
Evaluation It seems that so far no studies have addressed this issue.
Rural Electrification This paper presents findings from field trips to seven rural electrification areas in Eastern and
Southern Africa and shows how these studies can be used to illustrate different dimensions of
sustainability by means of indicators.
The field studies generated valuable experiences regarding collection of data for evaluation of the
indicators and illustrate some difficulties associated with comparing the different aspects of
sustainability.
The evaluation indicates that the national utilities perform better from a social/ethical perspective,
whereas the private organisations and the community-based organisations manage their client-relation
issues in a more sustainable way.
& 2008 Elsevier Ltd. All rights reserved.

1. Background and introduction nity-based organisations (CBOs) to engage in electrification


projects in developing countries.
In Africa, the majority of the population (in particular in rural The environmental sustainability of infrastructural develop-
areas) still lack access to modern energy services like electricity ment has received increasing attention, inspired by the 1987
supply. In fact, rural access to electricity is less than 5% in most World Commission on Environment and Development (Brundt-
countries in Southern and Eastern Africa (Gustavsson and land, 1987), and the Commission’s frequently quoted definition of
Ellegård, 2004). sustainability ‘‘Development that meets the needs of the present
National governments in developing countries and the inter- without compromising the ability of future generations to meet
national donor society have for many years given high priority to their own needs.’’ OECD (2001) has, for instance, elaborated the
improving this low level of electrification. Access to basic, clean definition by discussing the concept in the three dimensions of
energy services is essential for sustainable development and economic, environmental and social sustainability.
poverty eradication. With few exceptions, national utilities have It is possible that involvement of new actors in rural electrifica-
been responsible for electrification of rural areas. The progress has tion can accelerate the progress of rural electrification but it is not
been slow and the increase in access to electrification has often obvious that, for example, private entrepreneurs will give the same
not lived up to expectations. During the last few years, interna- emphasis to the environmental and social/ethical dimensions of
tional donors have therefore encouraged the involvement of other sustainability as organisations that are under public control.
actors such as private enterprises and different forms of commu- Comprehensive evaluations of electrification efforts like those
reported by Kjellström et al. (1992); NORAD (1994); the World
Bank (1996, 2003, 2005); Manibog et al., 2003; Sida (2002) and
 Corresponding author. Tel.: +46 10 505 10 31; fax: +46 8 653 31 93. Martins (2005) do not discuss the possible effects of the institutional
E-mail addresses: elisabeth.ilskog@syd.kth.se (E. Ilskog), arrangement on the contribution to sustainable development and it
bjorn.kjellstrom@exergetics.se (B. Kjellström). seems that so far no field studies have addressed this issue.

0301-4215/$ - see front matter & 2008 Elsevier Ltd. All rights reserved.
doi:10.1016/j.enpol.2008.03.022
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E. Ilskog, B. Kjellström / Energy Policy 36 (2008) 2674–2684 2675

A method for evaluation of the sustainability of electrification Of these dimensions, the economic, social, environmental, and
activities has been proposed by Ilskog (2008a). Five dimensions of institutional sustainability are also considered by major interna-
sustainability are considered: technical, economical, social/ethi- tional organisations (UN, 2001; IAEA, 2005). The fifth dimension
cal, environmental and institutional sustainability. Important has been included to put an additional focus on the technical
differences from previous attempts to evaluate sustainability by dimension since this has a direct influence on the sustainability of
means of indicators are the introduction of a fifth dimension—the the local project. Sustainable development requires that all
technical dimension, a selection of indicators focussed on the aspects of sustainability are fulfilled. Projects designed with the
local, project-specific performance, and definition of indicators focus on one aspect only, for example environmental sustain-
that facilitate data collection and reduce the room for subjective ability, cannot ensure sustainable development.
assessments.
The objective of the work reported on in this paper was to gain
experiences from the application of this method for sustainability 3. Selection of cases and methods used for data collection and
evaluations but also to look for differences in emphasis given to comparisons between the cases
the five dimensions of sustainability that could be attributed to
the type of organisation managing the electrification project. 3.1. Cases evaluated
After a brief discussion on indicators, their suitability as
message carriers and the selection of indicators for rural Seven organisations were included in the study. They were
electrification, the major part of the paper focuses on findings selected primarily from organisations of different kinds that had
from the case studies, followed by an analysis and suggestions for received financial support from the Swedish International Devel-
future research. opment Agency (Sida) and had been operational for more than 2
years. The private sector was represented by three PV energy
service companies, one co-operative and one CBO were included.
2. Indicators for the building of assessment tools A small isolated local grid branch and a larger local utility
connected to the national grid represented governmental utilities.
The organisations operate in Tanzania, Kenya and Zambia. Table 1
Indicators as tools for analysis and communication of changes
includes more details.
and trends have become commonly used by different organisa-
tions, see for instance, UN (2001), OECD/IEA (2001), World
Bank (2003) and IAEA (2005). One of the main reasons is 3.2. Data collection
that indicators can facilitate understanding of the information
included in extensive statistical data, making the information The findings presented in this paper are based on interviews
accessible for a larger number of stakeholders. Many of the with management, staff and case facilitators; surveys where
suggested indicators for appraisal of electrification efforts are, electricity clients were interviewed; inspections of physical
however, very general in their design, and are mainly suitable on a assets; and reviews of available written documentation for each
national or strategic level (Ugwu and Haupt, 2007). There is case included in the study. The written documentation covers
therefore a need to identify indicators suitable on a local project mainly: inspections of production units, inspections of distribu-
level. tion networks and substations, operational data in logbooks,
Such indicators have been proposed by Ilskog (2008a). client databases, and financial reports. The organisations respon-
The indicators were selected through an iterative process, sible for the services as well as local authorities had been
starting from indicators utilised previously by researchers and contacted well in advance.
consultants. The usefulness of these indicators was then The interviews with electricity clients, potential clients, and
assessed based on experiences from field studies, where the non-clients concern foremost the impact of electricity on their
possibilities of collecting the necessary data and information were daily lives. The interviewees who amounted to slightly more than
found to be an important reason for modification or change of 800 were randomly selected.1 Questionnaires taking 20–40 min to
indicators. complete were used, including both closed and open-ended
The performance of the individual project was in focus when questions. The surveys covered women and men, households,
the indicators were selected and designed. For each indicator, businesses and institutions. Teams of 2–7 fieldworkers that
there is a detailed description of the methods and procedures to included both women and men, trained to fill in the question-
be used for collection of the necessary information (see Ilskog, naires, collected the data. Most of the fieldworkers had been
2008b). The room for subjective assessments is thereby reduced. involved in national census work, giving them earlier experience
The format of the descriptions is the same as that developed by in working with questionnaires. All were knowledgeable in the
the UN Commission on Sustainable Development (UN, 2001). local languages and had at least secondary school education. The
Five dimensions of sustainability are considered. authors of this paper conducted three of the surveys: in 2002,
2003 and 2004. The other two surveys2 were conducted in 2001
 Technical sustainability, focussed on maintaining the energy and 2002 by another researcher as part of a research project at
service during the economic lifetime of the initial investment; Göteborg University in Sweden (Gustavsson and Ellegård, 2004;
 Economic sustainability, focussed on survival of the service Gustavsson and Mtonga, 2005; and Gustavsson, 2006).
beyond the economic lifetime of the initial investment; For one of the CBOs, no interviews with clients were made. The
 Social/ethical sustainability, focussed on equitable distribution information utilised here was collected from open-ended inter-
of the benefits offered by electrification; views with staff, management, and project facilitators. In addition,
 Environmental sustainability, focussed on the conservation of information from a paper based on a survey made by UNEP
natural resources, avoiding degradation of the environment, has been utilised (Wamukonya, 2004). More details are given in
and preventing in-door air pollution; Table 2.
 Institutional sustainability, focussed on survival of the organi-
sation and its ability to maintain adequate performance with 1
Except for the case ‘‘Private A’’ where the interviews included all the clients.
respect to the other dimensions of sustainability. 2
Covering the cases ‘‘Private A’’, ‘‘Private B’’ and ‘‘Private C’’.
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2676 E. Ilskog, B. Kjellström / Energy Policy 36 (2008) 2674–2684

Table 1
Organisations included in the study

Type of organisation Technology used Number of clients Total population Price for Electricity
within concession Services (USD/kWh)
area

Larger government organisation/ Main national grid supplied mainly by hydropower. The 59 000 (year 2004) 985 000a 0.03–0.11b (average:
utility (Government L) organisation also has a smaller local grid supplied by diesel 0.07)
generator sets
Smaller local branch of Local grid supplied by diesel generator sets 430 (year 2003) 75 000c 0.03–0.11b (average:
government-owned utility 0.07)
(Government S)
Co-operative (Co-operative) Local grid supplied by diesel generator sets 240 (year 2002) 82 000d 0.47
Community-based organisation Small hydropower 8 (Business Centre) NDA 0.006
(CBO) (year 2003)
Private company (Ltd.) (Private A) Solar PV located at each clients premises 100 (Solar Home 70 000e 1.6
Systems, SHS) (year
2003)
Private company (Ltd.) (Private B) Solar PV located at each clients premises 150 (Solar Home 365 000e 2.1
Systems, SHS) (year
2003)
Private company (Ltd.) (Private C) Solar PV located at each clients premises 150 (Solar Home 235 000e 1.6
Systems, SHS) (year
2003)

Sources: Information from the organisations studied and Statistical Bureaus in the countries included.
a
‘‘Tanzania 2002 population and housing census’’, National Bureau of Statistics Tanzania (2002b).
b
The lowest tariff is applied for low-consuming households only.
c
‘‘Household Budget Survey 2000/01’’. National Bureau of Statistics Tanzania (2002a).
d
‘‘Taarifa ya wilaya ya Urambo’’, Urambo District (2001). NDA: no data available.
e
‘‘Zambia 2000 Census Report’’, National Bureau of Statistics Zambia (2003).

Table 2
Presentation of methods for data collection for each case included in the study

Case Year of Method Number of evaluators Selection criteria


evaluation and/or enumerators

Larger government 2004  Survey covering 268 electricity clients and non-clients 9 field workers The interviewees were randomly selected from an
organisation/ in their homes/businesses/institutions. existing database used for an on-going household
utility  Survey covering 120 electricity clients at the census
organisations sales office.
 Inspection of production and distribution assets.
 Review of financial reports and databases.
 Interviews with staff and management of the
organisation.

Smaller government 2003  Survey covering 27 electricity clients in their homes/ 2 field workers The interviewees were randomly selected from the
organisation/ businesses/institutions. client ledgers of the organisation
utility  Discussions with staff and management of the
organisation.
 Review of logbooks and relevant reports.

Co-operative 2002  Survey covering 35 electricity clients in their homes/ 5 field workers The interviewees were randomly selected from the
businesses/institutions. client ledgers of the organisation
 Inspection of production and distributions assets.
 Discussions with staff and management of the
organisation.
 Review of logbooks and relevant reports.

Community-based 2003,  Discussions with staff and management of the 2 field workers No interviews were made with clients
organisation 2004 organisation.
(CBO)  Inspection of production and distributions assets.
 Review of logbooks and relevant reports.
 Review of a study carried out by UNEP (Wamukonya,
2004).

Private organisation 2001,  Survey covering 360 electricity clients, potential clients 7 field workers Private A: All clients were interviewed Private B and C:
A, B and C 2003 and non-clients in their homes/businesses/ the interviewees were randomly selected
institutions.a
 Review of financial reports
 Interviews with staff and management of the
organisation.

a
The survey was performed by Gustavsson, Human Ecology Section, Göteborg University, Sweden. Data from the survey has generously been granted for use in this
study.
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Table 3
Presentation of technical sustainability indicators for the cases included in the study (within brackets are the scores reached by each case in comparison with the other
cases included in the study)

Indicator Government La Government Sa Co-operative CBO Private A Private B Private C

Operation and maintenance


Conformance with national standards No (1.5) Yes (5) No (1.5) Yes (5) Yes (5) Yes (5) Yes (5)
for transmission/distribution
systems and client installations,
yes/no
Technical losses,b % 20 (3) 15 (4) 27 (2) 30 (1) 0 (6) 0 (6) 0 (6)

Technical client-relation issues


Daily operation service, % 100 (6.5) 100 (6.5) 19 (4) 38 (5) 17 (2) 17 (2) 17 (2)
Availability of services, % 98 (7) 88 (2) 97 (6) 70 (1) 95 (4) 95 (4) 95 (4)

a
S: smaller government organisation, L: larger government organisation.
b
Also referred to as un-paid electricity generation.

3.3. Determination of the sustainability indicators used by the private companies do not require transmission/
distribution systems and the client installations must be replaced
Only 31 of the 39 indicators suggested by Ilskog (2008a) were before the clients are connected to the national grid. These cases
determined; the reason being that the experiences from the field are therefore technically less well prepared for future grid
studies indicated that seven additional indicators would be useful expansion.
but could not be determined from the data collected during the In all the cases with central generation, a significant share of
surveys. This is discussed further in Section 5. the generated electricity was lost in transmission/distribution.
The guidelines presented by Ilskog (2008b) were followed Only the government utilities scheduled the operation for
when the indicators were determined from the data collected continuous supply. The co-operative limited the services to the
during the surveys. evening hours, and the CBO to business hours. The services from
the private solar PV companies are in principle available
3.4. Comparison between the case studies continuously, but the systems are designed for a limited lighting
load in the evening hours only. The reliability of the service during
scheduled operating hours is 95% or better for all the cases except
A ranking system was used for comparisons between the seven
for the CBO and the small local government utility.
cases. For each indicator, scores from 1 to 73 were given to each
case, where the case with the best performance from a sustain-
ability point of view was given the highest score and that with the 4.2. The economic dimension
lowest performance the lowest score. If several cases indicated the
same performance, the score was divided among them. Economic development is important for a sustainable devel-
The total score for a case for each sustainability dimension was opment in an area, and so is the economic development for the
then calculated by simple averaging of the scores for the relevant electricity service organisation itself. Beyond dispute, access to
indicators. This means that the indicators were given equal capital is a prerequisite for all forms of electrification since the
weights. In addition, an overall score for sustainability was initial investment is very high.
calculated for each case. This was done so that each dimension The indicators for each case included in the study are
had the same weight. presented in Table 4. The main differences between the cases
It is obvious that the outcome of the comparison may depend can be found in the operational and maintenance costs
very much on the procedure used for scoring and weighting (0.04–2.23 USD/kWh), and for profitability, which varies between
between indicators. This issue is discussed in Section 5 of the 21% to a negative figure of more than 1800%. The organisations
paper. showing negative profitability would have been forced to raise
their tariffs dramatically, with a factor of 5 for the small
government utility and 20 for the CBO to be able to make a
4. Findings profit.4 As seen in Table 1, the price for electricity services charged
by the organisations varies between 0.006 and 2.1 USD/kWh.
4.1. The technical dimension A prerequisite for survival of an organisation is (at the least) to
cover operational and maintenance costs, or that sufficient
Technical sustainability is facilitated if the technical infra- external financial support is received to cover the discrepancy.
structure locally available meets the requirements of the technol- Only the co-operative has tariff revenues that exceed the costs for
ogy installed, if the technology used can provide the service operational and maintenance costs. The CBO receives financial
needed, and if favourable technical performance leads to low costs support from a donor. The three private organisations supplement
for the services. the tariff revenues with income from sales of cold drinks,
Table 3 shows the performance of the seven cases studied with electrical equipment, etc. The national utilities utilise cross-
respect to the proposed indicators for technical sustainability. subsidies between different client categories. None of the
Some deviations from national standards in the construction of organisations is burdened by capital costs associated with the
low voltage distribution systems were observed for the large initial investment since international donors have mainly
government utility and the co-operative. The solar home systems financed the investments.

3 4
In accordance with the number of cases included in the study. With the same number of clients (as during the time of evaluation).
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Table 4
Economic sustainability indicators for the cases included in the study (within brackets are the scores reached by each case in comparison with the other cases included in
the study)

Indicator Government Government Co-operative CBO Private A Private B Private C


La Sa

Financial perspective
Profitability, % 9 (3) 378 (2) 11 (5) 1832 (1) 3 (4) 12 (6) 21 (7)
Operational and maintenance costs, USD/kWh 0.04 (7) 0.28 (4) 0.26 (5) 0.08 (6) 1.80 (2) 2.23 (1) 1.43 (3)
Costs for Capital and Installation, USD/kWh 0.01 (1) 0 (4.5) 0 (4.5) 0 (4.5) 0 (4.5) 0 (4.5) 0 (4.5)
Share of profit set aside for re-investment in 0 (2.5) 0 (2.5) 0 (2.5) 0 (2.5) 3 (7) 1 (6) 1 (5)
electricity service business, %
Tariff lag, USD/kWh 0 (7) 0.02 (4.5) 0.02 (4.5) 0.01 (6) 0.29 (2) 0.36 (1) 0.23 (3)
Development of productive uses
Share of electricity consumed by businesses, % 47 (6) 10 (1) 15 (5) 100 (7) 11 (3.5) 11 (3.5) 7 (2)
Share of households using electricity for income- 6 (1) 15 (6.5) 15 (6.5) 0 (1) 9 (4.5) 9 (4.5) 6 (2)
generating activities, %
Competition
Number of electricity service organisations in the 1 1 1 1 1 1 1
area, no

a
S: smaller government organisation, L: larger government organisation.

Table 5
Social/ethical sustainability indicators for the cases included in the study (within brackets are the scores reached by each case in comparison with the other cases, for one of
the indicators it has not been possible to give any scores)

Indicator Government Government Co-operative CBO Private A Private B Private C


La Sa

Improved availability of social electricity services


Number of street lights in the area, number/1000 0.05 (6) 0 (3) 0.21 (7) 0 (3) 0 (3) 0 (3) 0 (3)
population
Credit facilities
Micro-credit possibilities available for electricity Yes (7) No (3.5) No (3.5) No (3.5) No (3.5) No (3.5) No (3.5)
services connection, yes/no
Equal distribution
Share of population with primary school education, 96 (6) 97 (7) 88 (5) 74 (1) 83 (2) 84 (3.5) 84 (3.5)
%
Share of population with access to electricity, % 38 (7) 4 (6) 2 (5) 0 (1) 0.9 (4) 0.3 (2) 0.5 (3)
Distribution of electricity client households in 40 82 90 0b 82 74 74
income groups, % in higher income categories
Subsidies offered for electricity services, USD/kWh 0 (1.5) 0.22 (4) 0 (1.5) 0.13 (3) 2.24 (7) 2.16 (6) 1.87 (5)

a
S: smaller government organisation, L: larger government organisation.
b
No household clients.

Tariff lag is a problem caused by difficulties to adjust tariffs to primary school education varies between 74% and 97%. When
compensate for inflation. The organisations with the highest comparing women and men, the level of education among
operating costs show the largest lags, as these also operate in the women is between 1% and 14% lower than men within the cases
country with the highest inflation. included in the study. The subsidies of the tariff show large
The share of electricity used for productive activities is low in variations between the cases, and are covered mainly by external
all the cases, and limited to low-load uses such as lighting for resources.
extension of working hours for bars, grocery stores, etc., and to
enable income-generating activities in households.
4.4. The environmental dimension

4.3. The social/ethical dimension The assessment of environmental sustainability includes the
impacts on the local environment as well as the impacts on
The social/ethical dimension is the most complex of the five regional and global levels.
dimensions of sustainability. It does not only cover a broad area, The environmental indicators are presented in Table 6. The
but is also dependent and influenced by the development as a difference in global impacts depends mainly on the primary
whole, which, in turn, is often influenced by other factors than the energy source used. For example the organisations using PV
electricity service being evaluated. A comparison between the (Private A, B and C) and hydro power (CBO, Government L) receive
social/ethical indicators is presented in Table 5. a high score as a consequence of a high share of renewable energy
Table 5 shows that electricity clients are a small fraction as primary source and low specific emissions of CO2, whereas
of the population and mainly found in the higher income those using diesel generator sets (Co-operative, Government S)
groups for all the cases except the larger utility (Government L) receive a low score. The differences on a local impact level are
where almost 40% are connected and a minority of the clients small. In particular, the number of households that have shifted to
belong to the higher income groups. The share of population with electricity for cooking is small for all the cases studied.
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Table 6
Environmental sustainability indicators for the selected cases (within brackets are the scores reached by each case in comparison with the other cases included in the study)

Indicator Government Government Co-operative CBO Private A Private B Private C


La Sa

Global impact
Share of renewable energy in production, % 85 (3) 0 (1.5) 0 (1.5) 100 (5.5) 100 (5.5) 100 (5.5) 100 (5.5)
Emissions of carbon dioxide from production,b 0.33 (3) 1.1 (1) 0.95 (2) 0 (4) 0 (6) 0 (6) 0 (6)
kg CO2/kWh
Local impact
Share of electrified households where other energy 100 (4.5) 100 (4.5) 100 (4.5) 0 (1) 100 (4.5) 100 (4.5) 100 (4.5)
sources for lightingc has been replaced, %
Share of electrified households where other energy 1 (6) 0 (3) 3 (7) 0 (3) 0 (3) 0 (3) 0 (3)
sources for cooking of main mealsd has been
replaced, %
Any serious local environment impact identified, Yes (3.5) Yes (3.5) Yes (3.5) No (7) Yes (3.5) Yes (3.5) Yes (3.5)
yes/no

a
S: smaller government organisation, L: larger government organisation.
b
Calculated on input energy.
c
Mainly kerosene and candles.
d
Mainly charcoal and firewood.

Table 7
Organisational/institutional sustainability indicators for the cases included in the study (within brackets are the scores reached by each case in comparison with the other
cases included in the study)

Indicator Government La Government Sa Co-operative CBO Private A Private B Private C

Capacity strengthening
Share of staff and management with appropriate education, % 50 (1.5) 85 (7) 86 (6) 50 (1.5) 60 (3.5) 60 (3.5) 80 (5)
Degree of local ownership, % 0 (1.5) 0 (1.5) 100 (5) 100 (5) 100 (5) 100 (5) 100 (5)
Number of shareholders, no. 1 (1.5) 1 (1.5) 249 (7) 150 (6) 2 (4) 2 (4) 2 (4)
Share of women in staff and management, % 15 (4) 10 (2) 14 (3) 36 (7) 0 (1) 20 (5.5) 20 (5.5)
Number of years in business, no. 420 (6.5) 420 (6.5) 9 (5) 2 (2) 2.5 (4) 2 (2) 2 (2)
Client-relation
Share of non-technical losses,b % 26 (1) 14 (2) 10 (3) 0 (7) 5 (5) 5 (5) 5 (5)
Level of satisfaction with energy services, % 59 (3) 77 (4) 38 (1) 40 (2) 83 (6) 83 (6) 83 (6)
Stakeholder participation
Auditing of reports on yearly basis, yes/no No (2.5) No (2.5) No (2.5) No (2.5) Yes (6) Yes (6) Yes (6)

a
S: smaller government organisation, L: larger government organisation.
b
Also referred to as un-paid electricity services.

4.5. The institutional dimension Fig. 1 also shows the total scores reached by the seven
organisations. The differences are small but the larger utility
The dimension of institutional sustainability is closely linked shows the highest score and the CBO the lowest.
to the other dimensions in the context of sustainable develop-
ment, and indicators for institutional issues are shown to be the
most difficult to define (IAEA, 2005). As described in Table 2, the 5. Discussion
organisations included in this study represent four different types,
all with their own specific characteristics. 5.1. Technical sustainability
A comparison between the institutional indicators is presented
in Table 7. The main differences among the organisations are to be The information collected in the field studies indicates that the
found in the degree of local ownership and number of share- service can be maintained for the technical lifetime of the
holders, where the two member-based organisations have gained installations for all the cases. The historical operating records of
the highest scores. Other differentiating indicators are the number the two government utilities and the co-operative indicate that
of years in business (2 to 420 years), the share of non-technical the weaknesses in some technical indicators are not a major
losses (5–26%), and level of client satisfaction with electricity threat to continued service. From a client perspective, however,
services (38–83%). the availability of electricity services is important. If the
availability is not satisfactory, clients may for instance invest in
their own generating sets. The limited service periods of the co-
4.6. Comparison between overall findings for the seven cases operative, the CBO and the solar PV companies are therefore a
threat to technical sustainability. The data in Table 7 indicate that
Fig. 1 shows the average scores attained by the seven cases for this problem is most serious for the co-operative and the CBO.
each of the five sustainability dimensions. The differences A potential threat to the private solar PV installations would be
between the averaged scores are small for most of the dimensions. expansion of the national grid to include the areas served by these
However, behind the small differences in average rankings are organisations. This is not apparent from any of the indicators. An
large variations in ranking for the individual indicators, as shown additional indicator ‘‘Compatibility with future grid service’’
in Tables 3–7. might be included to account for this.
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Technical Indicators Economic Indicators


60 60

50 50

40 40

30 30

20 20

10 10

0 0
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Social/Ethical Indicators Environmental Indicators
60 60

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40 40

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G
G

Organisational/Institutional Indicators Total for all five dimensions


60 200
180
50
160
140
40
120
30 100
80
20
60
40
10
20
0 0
tL

tS

BO

B
A

tL

tS

BO

C
A
iv

iv
e
e

e
e
e

e
en

en
en

en
at

at
C

C
at
at

at
at
at

at
er

er
nm

nm
nm

iv
iv

nm

iv
iv
iv

iv
op

op
Pr
Pr

Pr
Pr
Pr

Pr
er

er
er

er
o-

o-
ov

ov
ov

ov
C

C
G

G
G

Fig. 1. Indicators presented for the five sustainability dimensions, and the total scores reached by the organisations for all dimensions. The indicators have been
summarised per case through comparative ranking and given equal weights. For the calculation of total scores, all dimensions have been given the same weight.

For all the cases evaluated, the support infrastructure in the shows that this is often not the case. An additional indicator
form of, for instance, supply of spare parts and availability of ‘‘Availability of support infrastructure’’ can be added to highlight
qualified technical services appeared to be available. The this issue. Ilskog (2008a) suggests that also an indicator
experience from numerous projects in developing countries ‘‘Efficiency’’ should be included. This is useful because it can
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E. Ilskog, B. Kjellström / Energy Policy 36 (2008) 2674–2684 2681

facilitate interpretation of poor economic and environmental the reason for better performance in these respects could be that
performance. the government utility expansion in areas served by the national
grid has been prioritised, and that the organisation operates in
5.2. Economic sustainability both rural and urban areas. For the smaller organisations, shortage
of capital is likely to be the main obstacle to expansion of the
service. It is possible that insufficient management capacity has
The tariffs were too low to allow accumulation of capital for
also limited the expansion of the service of the co-operative.
re-investment for all the cases studied. In addition, no capital
Among the small suppliers, only the co-operative has included
costs for the initial investment were paid, except to some extent
streetlights in their system. Streetlights have been found to reduce
by the large government utility. All the cases therefore depended
the feeling of insecurity when walking the streets after dark and
on external financial support, either from the government or from
are appreciated in particular by women (Cecelski, 1998).
a donor organisation. An important implication of this is that the
Additional indicators that were formulated after the fieldwork
financing organisation should be able to ensure, for instance,
reported in this paper had been completed are ‘‘Share of health
environmental and social/ethical sustainability by adding suitable
centres and schools with electricity’’, ‘‘Share of public places and
conditions to the financing decision. Such conditions could
specialised businesses where TV/telecommunication/internet is
include requirements for a generation technology using renew-
provided’’ and ‘‘Share of economically active children’’. These will
able energy and supply of parts of the generation for social
provide additional important information and they should there-
benefits like health centres, schools, and streetlights. Additional
fore be included in future applications of the method.
costs associated with these conditions must, of course, be carried
either by the financier or by the electricity clients.
The three private suppliers of PV electricity are examples of 5.4. Electrification and environmental sustainability
this. Use of solar home systems for providing electricity was a
requirement for financing. This has however resulted in a In two of the cases, diesel generators were used for the
relatively high price for small amounts of electricity, apparently generation of all the electric energy. Their contributions to the
acceptable to the consumers since the level of satisfaction with global greenhouse effect give them the lowest ranking with
the service is high, see Table 7. respect to global environmental sustainability. It must be realized,
The findings for the co-operative also demonstrate the will- however, that the annual emissions of CO2 per electricity
ingness and ability to pay a high price for small amounts of electric consumer in the co-operative is about 400 kg, similar to the
energy. It is true that most of the clients served by the co-operative emissions associated with electricity consumers in Sweden.
and the private PV companies belong to the high-income Sweden is one of the OECD countries with the lowest CO2
groups, but the findings for the small government utility branch emissions from electricity generation. Replacing the diesel
(see Table 5) indicate that a considerably lower tariff does not generators in the co-operative by a generation technology based
necessarily lead to a higher use of service in low-income groups. on renewable energy is therefore not of high priority in a global
Another interesting observation related to the tariff level is that perspective.
a low tariff does not necessarily result in more electricity use for Electrification has not resulted in a significant shift from wood
commercial activities. As shown in Table 4, the use of electricity for fuel and charcoal to electricity for cooking in electrified house-
income-generating activities is about the same as for the small holds, regardless of the tariff level and the service schedule. Since
government utility branch with a low tariff and the co-operative also only a small amount of the households in the electrified
and private suppliers with much higher tariffs. The small communities are connected many years after the start of the
differences are particularly interesting since the small government service (see Tables 5 and 6), it should be obvious that conservation
utility branch offers continuous supply, whereas the co-operative of natural forests is not a valid justification for rural electrification.
operates only in the evening hours and the PV systems allows only Taking Tanzania as an example, this is also the situation for the
a small daily use of electric energy. This limited use of electricity for country as a whole, even in electrified urban areas. In 2000/2001,
value-added activities has also been pinpointed in other studies 12% of the households reported having electricity, while electricity
(see for instance Kjellström et al., 1992; Kittleson, 1998). Among for cooking was found to be used by only 0.9% of the households
those reasons given were factors outside the direct control of the (National Bureau of Statistics Tanzania, 2002a).
electricity organisations, namely shortage of capital, transport
problems and a lack of skilled labour.5
5.5. Institutional sustainability
These findings indicate that low heavily subsidised electricity
tariffs in rural areas served by national utilities that have been
It is not possible to draw general conclusions regarding the
imposed by parliament decisions have been a serious obstacle to
effect of the type of organisation on the sustainability of rural
expansion of rural electricity supply and are not justified.
electrification projects from the results of this study. The cases
However, even if tariffs in the range of 0.5–1 USD/kWh could
included in the study are few. The technology and the organisa-
probably be acceptable to parts of the rural population, it is
tional form used may also be either a consequence of historical
unrealistic to believe that significant expansions of rural elec-
decisions, when there were fewer options available, or a result of
tricity supply can rely entirely on tariff financing. Initial financial
conditions imposed by the financing agency. However, it might
support will always be necessary.
still be of interest to compare the performance of the different
types of organisations as some of the strengths and weaknesses
5.3. Social/ethical sustainability identified for these individual cases may be generic.
The organisational weaknesses are mainly found among the
The larger government utility is the only case where elec- government utilities included in the study, and can be illustrated
trification has reached significant parts of the population. Part of by their low share of local ownership and their inability to reduce
the high non-technical losses, which can mainly be explained by
5
Additional information on the effects of a project on commercial activities
non-payment of electricity bills by different government institu-
would be gained by introduction of an additional economic indicator ‘‘Business tions/clients. This is in line with experiences from other develop-
development’’, see Ilskog (2008a). ing countries where the rate of outstanding payment has proved
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2682 E. Ilskog, B. Kjellström / Energy Policy 36 (2008) 2674–2684

higher if the services are operated by the government, rather than The information included in the indicators should give a
if private companies or CBOs are responsible (ESMAP, 2000). reasonably good picture of the situation at the time of data
The private organisations manage their client-relations the collection. However, sustainability is a matter of development
best. However, they are small and vulnerable. Sole ownership can over time. Data from a single evaluation is therefore not sufficient
be a severe risk for the long-term survival of organisations, as for assessment of sustainability, even if the data can certainly be
they are commonly located in areas with a relatively high level of used for identification of areas where improvements will be
HIV/AIDS (Ilskog, 2005). necessary. Information about the trends of the indicators would
For the two CBOs the main strength is the advantage of lead to considerably improved possibilities to assess sustainabil-
community participation, whereas the main weakness is their ity. In particular, for some of the social/ethical indicators the
inability to raise the tariff, as this decision has to be supported by development over time can be a very important measure of the
the majority of members (who themselves are also the electricity impact of electrification. Baseline data were not available for any
clients). Adjustment of the tariff is to some extent also a problem of the evaluated sites. This problem is not uncommon, which can
for the government utilities, where decisions on tariffs are made be illustrated by evaluations assigned by Sida (2002), and NRECA
by the government and increasing tariffs can be politically (2002). In the study assigned by Sida, the evaluation was planned
sensitive. to include comparisons of the situations before and after the
It seems there is no single most appropriate organisation for implementation of the project. The study however found that no
electricity services in rural areas. When a choice between baseline data were available, nor was the possibility of finding
different organisational set-ups is possible, case-specific condi- such data at country level ‘‘fulfilled to any significant degree’’
tions that may influence the strengths, weaknesses, opportunities (Sida, 2002).
and threats, identified here, should be considered.

5.7. Overall comparisons of sustainability


5.6. Choice and determination of indicators
Aggregating indicators for generation of measures for the
Use of clearly defined indicators for evaluation of rural different dimensions of sustainability and combining these results
electrification projects could contribute to an improved basis for for a simple overall assessment of the sustainability, clearly
decisions regarding the design and organisation of future projects. involves serious methodological difficulties. The approach used
The number of indicators proposed by Ilskog (2008a) is 39 out of here, giving the results presented in Section 4.6, is just one
which eight were formulated after the fieldwork reported in this example of possible approaches, but the results nevertheless give
paper had been completed. The case studies have therefore a good illustration of the weaknesses of all attempts to generate
included determination of 31 of the proposed indicators and the simple measures for sustainability.
obvious questions are whether the experiences from practical The general impression given by Fig. 1 is that the differences
work confirm that these indicators meet the requirements, if between the cases evaluated are small for most of the dimensions.
some of the indicators can be dropped, and what the eight Combination of the results to give a measure for the overall
additional indicators might have contributed. sustainability further reduces the differences.
It may be argued that several of the indicators depend on other It is apparent from Tables 3–7, however, that there may also be
indicators and that this may exaggerate differences in the overall large differences between the cases when the aggregated measure
rankings. If this is considered a problem, weighting of the for the dimension of interest shows small differences. The small
indicators could be used. This is certainly better than the differences in aggregated economic sustainability for instance
elimination of indicators since the indicators facilitate the under- hide the fact that there are large differences in profitability and
standing of reasons for good or bad performance. The reasons for the share of the electricity used for commercial purposes. The
adding indicators to those determined here, are discussed in small differences in aggregated environmental sustainability hide
Sections 5.1–5.5. the fact that four of the cases use 100% renewable energy as the
The efforts for determination of the indicators will always be primary source and that two of the cases use 100% fossil fuel. The
case specific and depend mainly on the remoteness of the site and outcome would of course change and could change dramatically if
the availability and quality of the records kept by the local the indicators were weighted, but this leads to the problem of
management. The experiences from the six smaller projects with selecting the right weights to use for the different indicators.
some hundred clients indicate that the data collection on site can The use of ranking for the generation of common scales for the
be completed with an effort of 10–12 working days. The cost for indicators within each dimension is also problematic, because it
this is a small fraction of the initial investment. The evaluation of can either reduce large absolute differences or exaggerate small
the larger utility required an effort of approximately 40 working absolute differences. The indicator ‘‘Share of population with
days. access to electricity’’ in Table 5 illustrates both effects.
As much as possible, the data were collected from logbooks, There are several alternative approaches. One would be to
ledgers, and reports, supplemented with interviews based on define target levels for the indicators and use the number of
questionnaires. Subjective assessments were minimised by this indicators that reach the target level as a measure of the
approach. No major difficulties with establishing the data were sustainability. For indicators that fall below the target level, the
experienced, but it was found that data on economic activities and ratio between the indicator value and the target could be used as a
ownership of assets could be sensitive. measure. Such an approach would focus more on absolute
The choice of units is a difficult issue for some of the indicators. sustainability than the present, where the performance of cases
Percentages are a reasonable choice for several of the indicators, is compared relative to each other. At least for some of the
but in particular for some of the economic indicators it was found indicators, definition of the targets would present problems.
that absolute values give a better understanding of the perfor- Regardless of how indicators are measured and aggregated,
mance. When percentages are used to express these indicators, important information about differences between cases evaluated
the result depends on the reference value used. Large absolute may be lost and it is therefore important that the data for the
differences may be hidden by this and small absolute differences individual indicators also be reported when projects are compared
exaggerated. based on aggregated indicators.
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5.8. Dynamics of rural electrification operative and the CBO, the main strengths as well as the main
weaknesses are found in the organisational/institutional sustain-
In general, the technical possibilities for building sustainable ability.
electricity supply systems are better with large integrated There is a willingness and ability in the higher income groups
distribution grids than for small, isolated systems or individual in rural areas to pay a high unit price for small amounts of
solutions. However, the initial electrification of a rural area must electricity used mainly for lighting. Subsidising the price does not
often, for economic reasons, rely on individual solutions or a small necessarily lead to more electricity use among those with lower
isolated grid. When the local load has grown sufficiently, incomes. In addition, access to electricity services in a rural area
integration with the national network can be justified. The long- and low electricity prices does not necessarily lead to utilisation of
term sustainability of a rural electrification project therefore electricity for productive purposes and therefore not to increased
largely depends on how the design of the project facilitates or economic activity, either.
complicates such development. The indicators determined from Substitution of traditional fuels by electricity for cooking is a
the field studies of the seven cases are not sufficient for slow process. This is also true when the services are continuous
assessment of this. and the tariff low. Conservation of forests is therefore not a valid
Two of the additional indicators proposed by Ilskog (2008a) justification for electrification.
‘‘Compatibility with future grid service’’ and ‘‘Business develop- Introduction of solar PV for electric lighting in rural households
ment’’ contribute information that is essential in this context, but by means of donor-financed projects leads to improved quality of
the issue is complicated and further work will be needed to define life in the target households but according to the indicators
the most important indicators to use for including dynamics of included in this set, no benefits for the rest of the society have
rural electrification in the assessment of project sustainability. been shown.

6. Conclusions 7. Recommendations

Despite the large number of rural electrification projects being The following actions would contribute to improved sustain-
financed by the international donor community there are few ability of rural electrification projects:
published in-depth evaluations of the effects of these projects and For the benefit of all those engaged in financing and
in particular, the institutional arrangement used, on sustainable implementation of rural electrification projects, systematic eva-
development. luations shall be made of all projects using a standard set of
The implementation of the evaluation method proposed by sustainability indicators. The indicators suggested by Ilskog
Ilskog (2008a) has generated valuable experiences regarding (2008a) and described in full detail by Ilskog (2008b) could be
collection of data for evaluation of rural electrification projects. used as a basis for discussions of the most relevant and suitable
The proposed indicators give a good picture of the present indicators. The evaluations should include a baseline study and
situation for the cases evaluated. However, for assessment of the repeated evaluations on at least three occasions after commis-
sustainability of the services, repeated evaluations are necessary. sioning, for instance after 1, 3 and 10 years. Information about
The implementation has illustrated some difficulties asso- positive or negative trends for the indicators would definitely be
ciated with comparing the different aspects of sustainability. The valuable for assessment of a project’s contribution to sustainable
main difficulties are the ranking carried out for comparison of the development.
cases and the aggregation of the indicators to give a ranking Aggregation of indicators to give simple measures for the
within each dimension. Aggregation of indicators can lead to loss different sustainability dimensions should be avoided. Instead, a
of important information and should not be performed without minimum acceptable level and a target level for each indicator
also reporting the values of the indicators. may be defined and projects assessed based of the number of
It is not possible to draw general conclusions about the indicators where the minimum level and the target level were
performance of private enterprises, co-operatives or community- exceeded.
based organisations (CBOs) with respect to the five dimensions of Rural electrification through small private and local commu-
sustainability in comparison with government utilities. The nity-based organisations shall only be applied when this appears
number of cases studied is small and the performance is partly the most effective way to achieve sustainable development.
a result of conditions imposed by the external financing Special attention must then be given to the institutional
organisations. It is not possible to state whether any specific sustainability so that for instance loss of key persons does not
organisational form will have a particular impact on the social lead to the service collapsing.
benefits of electrification, but it is reasonable to believe that the Tariff setting for rural areas should take into account the great
private market will only deliver these energy services if the full willingness and ability to pay a relatively high price for electricity
costs are covered. used in households.
It is an important observation that all the organisations rely on Donor agencies that provide financing for rural electrification
external financial support to some extent, and especially on projects should use their influence to ensure that all-important
financing the initial investment; none of the organisations is able aspects of sustainability are considered by the implementing
to accumulate capital for re-investment. This opens up possibi- organisation.
lities for external influence that could be used to promote
sustainable development.
The main strength of the three private electrification enter- Acknowledgements
prises is their ability to manage client-relation issues whereas
their main weakness concerns the social sustainability perspec- This paper is based on research funded by the Swedish
tive, and that they are owned by only one person/family. The International Development Cooperation Agency, Department for
national utilities on the other hand have their main advantage in Research Cooperation (SAREC) and Ångpanneföreningen’s Foun-
the social/ethical sustainability dimension. The main weakness of dation for Research Cooperation (ÅFORSK). The proposed method
the utilities concerns the organisational dimension. For the co- is, to a great extent, based on experiences gained from surveys in
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2684 E. Ilskog, B. Kjellström / Energy Policy 36 (2008) 2674–2684

electricity service organisations in Tanzania, Zambia and Kenya 08:2—SE. ISBN 978-91-7178-886-3. Royal Institute of Technology, Stockholm,
and ideas generated during discussions with management, staff Sweden.
Kittleson, D., 1998. Productive uses of electricity: country experiences. In: Village
and clients in these organisations, as well as with the supervisors Power Conference, Convened by the National Renewable Energy Laboratory in
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Eva-Lotta Thunqvist, Royal Institute of Technology (KTH). Special DC, USA, October 6–8, 1998.
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Göteborg University, for their contribution of data. In addition, the Sweden.
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