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Enhancing the Social and Economic Impacts of Energy Investments
through the Use of Energy to Create Value
Final Synthesis Report of Research
Sierra Leone, Africa
Clark A. Miller, Saurabh Biswas, Wilbourne Showers, BrieAnne Davis, Nalini Chhetri, Netra
Chhetri, Mary Jane Parmentier, Festus Lansana
Note: This report is part of a package of three reports, which together summarize the results of
the project. The other two reports are:
Summary of Findings and Data
Data Collection Methodology
An Applied Research Project by:
Tempe, Arizona, USA
Freetown, Sierra Leone
Funded under the:
Funded by:
Managed by:
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Introduction: Electricity Access, Economic Growth, and SDG7
Under the United Nations Sustainable Development Goals, universal access to clean energy
(SDG7) has become a major focal point of international energy investments. As one of the most
widely used forms of energy, electricity is an integral element in sustainable development. While
growing investments in electrification from 2010-19 significantly improved global access to
electricity, current projections suggest that the world will, nonetheless, fail to meet its target of
universal access to electricity by 2030 (SE4All 2022). Worse, evidence from recent research sug-
gests that, even as investments in electrification have increased in extremely low-income coun-
tries, projects have resulted in little to no local economic development for households or commu-
nities receiving access to electricity, especially in low-income countries (Lee et al. 2020, 2017;
Terrapon-Pfaff et al. 2018). These governmental and market failures to invest sufficiently to pro-
vide universal access to electricity, as well as to enable communities to translate access to elec-
tricity into economic growth suggest the need for significant rethinking of electricity access strat-
egies for the final push to achieve SDG7 goals and beyond (Trace 2021a, b). To address the fail-
ure to translate energy access into sustainable development, while concurrently driving higher
levels of investment in clean energy projects to reach unelectrified communities, significantly
greater attention needs to be paid to ensuring that recipients are able to leverage electrification
projects to achieve higher levels of social and economic impacts (Biswas et al. 2021; Miller et al.
2018).
In this report, we provide a high-level synthesis of the results of new research into the social and
economic impacts of electricity access in Sierra Leone. The purpose of this research was to de-
velop, pilot, and evaluate the use of novel methods for measuring two critical parameters that in-
fluence the social and economic impact of energy projects: the social value of energy (Biswas
2020; Miller et al. 2015a) and the energy-poverty nexus (Biswas et al. forthcoming; Biswas
2020).
The social value of energy is defined as the net value created by a household, business, or
community through their use of energy. This value includes both financial and non-financial
forms of value creation (note: non-financial value includes, e.g., educational or health benefits,
improved security, etc.), while also accounting for the costs of paying for energy, the environ-
mental and health risks or burdens posed by energy systems, and any other burdens imposed by
energy systems or energy use (e.g., time burdens). The energy-poverty nexus is defined as the
dynamic feedback loops among diverse forms of energy insecurity and economic insecurity
that operate for households, businesses, or communities. Where these feedbacks are predomi-
nantly negative, energy systems contribute to perpetuating and/or exacerbating poverty and
inequality. Where feedbacks are predominantly positive, by contrast, energy systems contribute
over time to alleviating poverty and strengthening economic and financial resilience and secu-
rity.
The social value of energy and energy-poverty nexus are closely related to what has come to be
known as the capabilities approach to poverty and human development (Sen 1990; Nussbaum
and Sen 1993), which focuses on the capabilities of individuals and communities to undertake
actions that enhance their freedom and wellbeing. Energy is ordinarily assumed to be an enabler
of capabilities, allowing people to either do things they otherwise would have been unable to do
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or to do them more easily (Day et al. 2016; Middlemass et al. 2019). Yet, this view is too limited.
There are many conditions that can exist that restrict people’s capabilities to use energy in ena-
bling or empowering ways, even if they technically have access to energy. For example, energy
may not be available when people need it. They might not have the necessary appliances to use
energy in ways that create meaningful value. Or the costs of both energy and appliances may be
sufficiently high that they purposely limit their use of energy. It is also important to understand
the use of energy as a complex function that includes not only the value created but also the costs
required, whether that be money to purchase the energy or to purchase the appliances needed to
use it to create value or the time required to acquire and use energy or appliances. When these
additional costs of energy use are factored in, including the erosion of financial capabilities or
the trade-offs associated with time burdens, energy use may end up undermining overall capabil-
ities rather than empowering them (Biswas 2020).
The methods developed in this study for measuring the social value of energy and energy-pov-
erty nexus complement recent advances in methods for measuring electricity access that empha-
size the characteristics of electricity supply, e.g., especially, the multi-tier framework for energy
access (MTF) developed by ESMAP (Bhatia and Angelou 2014). The MTF framework high-
lights that simple metrics of access, which measure, for example, the presence or absence of an
electricity connection to a household, business, or community, are highly inadequate for as-
sessing whether electricity supply is sufficiently reliable, frequent, or powered to enable mean-
ingful use of electricity. Unfortunately, by themselves, measurements of supply characteristics,
while necessary, are insufficient for determining whether or not household, business, or commu-
nity users of electricity can make sufficiently meaningful use of electricity to create significant
social or economic impact. To explore the latter, it is necessary to be able to measure (a) how
and to what ends electricity is being used; (b) whether or not the user is able to use the electricity
in ways that create significant social and economic value or strengthen their capabilities; (c) what
factors condition their ability to use electricity to create value; and (e) whether or not the value
created through the use of electricity is greater than the costs and risks associated with electricity
use (Miller et al. 2018). Making such measurements requires attending to more than just the ag-
gregate energy demand, it includes knowing the purposes for which energy is used, the effective-
ness and efficiency of energy use in advancing value creation for those purposes, the availability
of knowledge, skills, and devices that enable valuable energy use, and the costs, risks, and bur-
dens of energy use.
The broad findings of this study suggest that, in fact, measurements of the social value of energy
and energy-poverty nexus offer valuable insights into the factors that enable and constrain the
social and economic impact and benefits of electricity access projects. We find, for example, es-
pecially in low-income households, businesses, and communities, that the costs, risks, and bur-
dens of electricity access are generally much higher. This significantly reduces the ability of
these households, businesses, or communities to achieve net positive social value from energy
use, consequently contributing to worsening of the energy-poverty nexus. Indeed, we find that
for a majority of households in Sierra Leone, the net social value of energy is negative,
meaning that electricity access is, broadly, undermining household financial security and
exacerbating poverty.
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Our research has allowed us to identify and differentiate multiple categories of households, how-
ever, each of which encounters very different conditions; experiences the limits of electricity ac-
cess differently; and requires different strategies for developing and implementing solutions
(e.g., we are able to differentiate those households for which the primary limiting factor on net
social value of energy is cost, in contrast to households for whom the reliability of electricity
supply is the primary constraint. We also find, unlike studies that focus only on electricity supply
and neglect attention to energy use, that the supply and use of electrical devices and appli-
ances are essential to the translation of electricity access into positive social and economic
impact and social value creation. Electrical appliances (e.g., lightbulbs, fans, motors, heaters,
refrigerators, freezers, batteries, etc.) are required in order to use electricity to provide specific
outputs and services. As a consequence, numerous aspects of appliances affect net social value
creation and contribute to whether energy-poverty nexus feedbacks are negative or positive, in-
cluding availability and access, purchase price, repair frequency and cost, usability, efficiency,
quality, productivity, and more. Too often, however, electricity projects neglect attention to elec-
trical appliance markets or policies, undermining or limiting the benefits of electricity access or
overlooking its added costs.
Together, these findings suggest that electricity access projects would benefit considerably from
explicit attention to how users use energy, especially in relation to strengthening the likelihood
that electricity projects will enhance economic growth and human development among project
beneficiaries.
Study Design
To evaluate the social value of energy and energy-poverty nexus for households in Sierra Leone,
we implemented a research approach grounded in a multi-layer framework for analyzing socially
valuable energy use by users and the contextual factors that impact the value generated. In its
most disaggregated form, the multi-layer framework operates across seven tiers of activity (Mil-
ler et al. 2018):
• Tier 1: Socially valuable uses of energy – The first tier assesses the practical use of en-
ergy by users for diverse purposes and the value created for the user through that use of
energy. For example, a user who uses an electric sewing machine to produce clothing for
sale for income would be considered to be using electricity for a valuable purpose. Social
value can include either financial/economic value (e.g., income, business revenue) or
non-financial value (e.g., improved capacity, education, or health).
• Tier 2: Socially valuable energy services – The second tier assesses the energy services
required by users in order to generate value through energy use. Sample energy services
include light, heat or cooking, cooling or refrigeration, water pumping, power for equip-
ment, transportation, computing or communication, etc. For example, a sewing machine
uses electrical power to run motors that sew thread into cloth.
• Tier 3: Socio-technical practices and arrangements – The third tier assesses the social
and technical elements required to produce a specific socially valuable energy service.
Sewing clothing, for example, requires a functioning sewing machine, an electrical outlet
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to plug the machine into, knowledge and skills in clothing design, as well as how to use a
sewing machine.
• Tier 4: Energy system organization and workforce – The fourth tier assesses the work of
producing, delivering, and selling energy and the organizations that do that work.
• Tier 5: Ownership and financial flows – The fifth tier assesses the ownership of energy
assets and financial flows associated with energy production and consumption.
• Tier 6: Energy policy and institutions – The sixth tier assesses the policy and institu-
tional context that regulates the generation, delivery, and sale of energy.
• Tier 7: Energy innovation ecosystem and markets – The seventh tier assesses the eco-
system of participants that are required to advance and enable innovative new approaches
to energy production, delivery, and consumption.
For the purposes of this project’s data collection, we grouped these tiers into three broad catego-
ries of data collection: (a) energy users and use (tiers 1-3); (b) energy systems (tiers 4-5); and (c)
the institutional, legal, and business context of energy production and consumption (tiers 6-7).
Figure 1 provides an overview of the various facets of the project’s data collection strategy. Data
collection involved four methodological approaches:
• Household surveys examining how users used energy, energy costs, and the value users
derived from energy use.
• Surveys of businesses involved in electrical appliance markets examining current and
anticipate future areas of appliance sales, electrical appliance breakage and repairs, ways
to improve customer experience and satisfaction, and future opportunities and challenges.
• Focus groups examining the use of energy and the creation of value from energy use in
community spaces and facilities, e.g., markets, schools, places of worship, and clinics.
• Informal discussions and open-ended interviews with diverse stakeholders, conducted
individually and in groups, in the public, private, and non-profit sectors, with questions
about the design and operation of energy systems, energy institutions, and energy policy
and governance.
This study design centers on two key concepts that orient what we describe as a user-centered
approach to the study of energy and energy systems. Our focus is on the people that use energy,
in different forms, for different purposes, and the value that they are able to create for them-
selves, their families, organizations, or communities. We define this value as the social value of
energy, encompassing both economic and non-economic forms of value (Biswas 2020; Miller et
al. 2015). Calculating the social value of energy requires being able to identify and measure the
differentiated uses of energy for a given user and the value derived from each use, the contextual
factors that condition the use of energy for value creation, and the costs or burdens that the en-
ergy system. The social value of energy is thus a composite measurement that accounts for
the net economic and non-economic value created, less the costs, risks, and burdens of en-
ergy. We were interested in this study in both measuring the social value of energy and under-
standing where there might be opportunities for enhancing the social value of energy for users in
the future, whether by increasing value creation or reducing energy costs.
The social value of energy is closely related to what we define as the energy-poverty nexus
(Biswas et al. forthcoming; Biswas 2020), which is the feedback that occurs in any community
6
between energy security/insecurity and economic security/insecurity. Unfortunately, as men-
tioned earlier, for many communities, especially those experiencing poverty, the value created
through the use of energy is lower than the aggregate costs associated with energy use, resulting
in a net negative social value of energy. Under these conditions, energy use can erode the finan-
cial and economic security of households, sometimes significantly, thereby exacerbating or per-
petuating poverty. This is an illustration of a negative feedback between energy insecurity and
economic insecurity.
Figure 1. Overview of project data collection strategies
Our study was designed to capture a wide range of elements that characterize the social value of
energy, the energy-poverty nexus, and people’s capabilities in an attempt to understand whether
the social value of energy was net positive or negative and, relatedly, empowering or eroding of
capabilities. These included:
• Differentiated energy uses and values: across all of our sites, we asked respondents to
identify the uses to which energy was put and the value created by the use of energy (for
example, in the form of income derived from the use of electrical appliances).
• Comprehensive energy costs and burdens: we asked respondents to provide us with a
comprehensive view of their monthly household expenses, including their expenses for
different forms of energy use as well as expenses for acquiring and repairing electrical
appliances that enable energy use.
• Net social value of energy estimation: we asked respondents to provide us with two
overall estimates of the net social value of electricity, the first of which focused on a rela-
tive estimation of how much their electricity service was worth to them compared to the
actual cost of that electricity service and the second of which requested an estimate of the
value to them of any significant improvements in the reliability of electricity service or in
overall levels of electricity supply.
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• Energy appliance markets: given the importance of electrical appliances to the possibil-
ity of using electricity to create value, we asked both households and electricity appliance
retailers a range of questions designed to elucidate the functioning of electrical appliance
markets, including the cost, affordability, and availability of electrical appliances, their
quality and frequency of breakdowns, the cost of appliance repairs, and current status and
future trends in the sale of electrical appliances and equipment.
• Prospective pathways for enhancing social value of energy: we asked respondents to
identify prospective future opportunities that they saw for using electricity in new and
valuable ways, including the kinds of appliances they might purchase in the future for
generating income, other forms of energy-related value creation they would like to take
advantage of in the future, and opportunities for improving the quality or level of electri-
cal service and/or the availability, affordability, or accessibility of electrical appliances.
We pursued this study through a comparative analysis of four communities in Sierra Leone over
a three-year period from 2019-2021. The four included the capital city of Freetown, two smaller
cities undergoing grid extension projects, Bo and Kenema, and a fourth, rural community with a
standalone, solar-powered microgrid, Segbwema. In each, we conducted community transects to
identify specific neighborhoods to sample and then followed up with surveys of households,
electrical appliance businesses, and community spaces.
Details of the survey and interview methodology can be found in the project’s parallel report,
Data Collection Methodology.
Key Project Findings
Overall, the results of our study suggest that energy plays a mixed role in the Sierra Leone econ-
omy and society. The people of Sierra Leone are able to create diverse forms of social and eco-
nomic value from their access to electricity and other forms of energy. However, value creation
is severely limited by a wide range of factors, including inadequate and unreliable energy sup-
plies, lack of access to electricity, and limitations on the use of energy to create value. When
considered in relation to the cost of energy and electricity for households, the net social value of
energy for the large majority of Sierra Leone households is negative, meaning that, as currently
organized, Sierra Leone’s energy and electricity systems act as a drag on social and eco-
nomic development and security and, instead, contribute to perpetuating and exacerbating
poverty and inequality.
With measurements of the net social value of energy, we are able to sort households into groups
with very different experiences of the energy-poverty nexus and thus very different needs for
policy interventions to improve the social value of energy. This is potentially an important tool
for electric utilities, as it creates opportunities for tailoring energy policy in ways that maximize
the social and economic benefits of intervention while minimizing program costs. In addition to
the direct costs of electricity or fuel, we also find that poorly functioning electrical appliance
markets contribute significantly to the net negative social value of energy. Interventions in elec-
trical appliance markets may, therefore, be as important as interventions in energy system design
8
and function in tackling the energy-poverty nexus and in finding ways to transform energy use
into a generative source of social and economic value creation and development.
Extremely high comprehensive energy burdens: Frequently, measures of energy burdens com-
pare the cost of a source of energy, such as electricity, to monthly household expenses or income
in order to estimate the burden of energy bills on household finances. While useful in providing
comparisons of the relative burden of energy costs on different households, such estimates fall
short of providing a comprehensive assessment of the full costs to households of participating in
energy systems and securing and using energy to create value.
To estimate the latter, we provide an estimate of comprehensive energy burden. We define the
comprehensive energy burden as the total fraction of household expenses that contribute to the
purchase and use of energy. To take steps toward a measure of comprehensive energy burden for
households in Sierra Leone, we collected significant additional data beyond energy expenses.
First, as explained in our detailed methodological document, we adopted an expense-based ap-
proach to household expenditures and collected data to obtain a robust picture of the total array
of monthly household spending. As part of this approach, we collected data on electricity ex-
penditures, cooking fuel expenditures, and transportation expenditures, as the latter incorporates
substantial energy costs. We also collected data on expenditures to provide for backup electricity
supply, such as generator and fuel costs or electric batteries. Finally, we collected data on house-
hold costs associated with purchasing and repairing electrical appliances.
In Figure 2, we present a breakdown of monthly expenses for an average household in Bo, one of
the four communities we surveyed for the study (for data on the other communities, see our par-
allel report, Summary Report of Findings and Data).
Figure 2. Household monthly expenditures for the community of Bo.
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Based on monthly expenditure data, we were then able to assess the basic expenditure burden for
energy and other key services for households in each of our four communities. Figure 3 presents
the overall burdens for the residents of Kenema. Taken together, across the four communities,
our data show that energy burdens are very high for households in Sierra Leone. Even consider-
ing only the electricity bill, the median household faces an electricity burden of 7-10% of their
monthly expenses across the four communities, compared, e.g., to a median of 2.3% in the
United States. Households within one standard deviation of the median face electricity bill bur-
dens of 5-18%. This is only the tip of the iceberg for energy expenses, however. Adding in the
costs to provide backup electricity supply raises the median burden to 8-18%, and adding cook-
ing fuel costs raises the median burden to 12% in Freetown and 40% in Segbwema. Overall, we
find that for households with energy burdens a standard deviation below the median or higher
(roughly 84% of the population), the burden of paying for energy is sufficiently high to act as a
significant drain on household financial resources and to contribute negatively to the functioning
of the energy-poverty nexus (we will further confirm this finding below).
Figure 3. Steps toward a comprehensive energy burden assessment for the residents of Kenema.
To convert energy into social or economic value requires more than just energy, however. It also
requires having access to the proper appliances and equipment to use energy in valuable ways.
One of our central concerns in this project was therefore to understand the role of electrical ap-
pliances in household use of energy and household economies. We, therefore, also measured
household appliance composition, attitudes toward electrical appliance composition, the fre-
quency and cost of household electrical repairs, and the functioning of electrical appliance sales
businesses and markets. We present the bulk of this data in subsequent sections. Here we report
on average household repair frequencies and expenditures.
10
Figure 4 shows the primary appliances suffering breakdowns for households in the communities
of Bo, Kenema, and Segbwema, as well as the repair frequencies. All households reported hav-
ing at least one appliance need repair in the past year, with the majority of appliances suffering
breakdowns being larger and more commonly used items (refrigerators, televisions, fans, and au-
dio/visual equipment). These breakdowns generally result from the high frequency of low-qual-
ity electrical supply, including voltage and frequency problems, as well as spikes associated with
regular electricity system failures.
Figure 4. Number (left) and frequency (right) of appliance breakdowns for the communities of
Bo, Kenema, and Segbwema.
Appliance repairs add substantial costs to household budgets. Figure 5 shows the average annual
costs of appliance and wiring repairs for households in the community of Kenema for each of
three categories of households: those with a basic set of appliances (B); those with a somewhat
larger set of appliances (B+); and those with a significantly larger set of appliances (B++). Fig-
ure 6 shows the percentage of households in each category in each community. Not surprisingly,
households with larger appliance sets suffer from higher annual repair and maintenance costs.
Figure 5. Cost of appliance and wiring repairs for households in Kenema (left) and Bo (right).
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Appliance Ownership Categories
Freetown
Bo
Kenema
Segbwema
Basic (or B)
(Iron, Fan, Bulbs, TV, Music/Enter-
tainment system)
14%
29%
24%
55%
Basic + (or B+)
( Basic + Refrigerator, home theater,
water heaters)
63%
63%
60%
45%
Basic ++ (or B++)
( Basic++ AC, multiple Refs & TVs,
microwave, rice cooker/electric
cooker, Blender water heaters, water
filter, Washing machine, Water
pumps)
23%
8%
16%
0%
Figure 6. Percentage of households in each community falling into each category of appliance
ownership.
The full range of energy expenses add up. For example, as shown in Figure 7, considering elec-
tricity expenses alone, the average Freetown household spends 3.2 million Leones, annually, to
pay for electricity bills, the cost of backup electricity services, and appliance repairs. Compared
to the average annual income for a Sierra Leone household (World Bank, 2022), which is an esti-
mated 7.65 million Leones, that would amount to an annual electricity burden of 42%. We find
overall household expenses to be higher, which is why we used expenses rather than income to
calculate our primary metric of energy burden (Figure 3), but the income metric is telling, too. In
short, no matter how we measure it, the comprehensive energy burden for Sierra Leone house-
holds is extremely high and, by extension, a considerable drain on economic security.
Figure 7. Average annual electricity costs for a Freetown household.
Curtailment of energy use and value creation: Not surprisingly, given high overall energy costs
and high relative burdens represented by energy in household budgets, the project also found
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significantly high levels of curtailed energy use by households. A significant proportion of cur-
tailment is self-induced, reflecting decisions by households to deliberately limit energy use in or-
der to reduce energy costs or because financial resources are unavailable for purchasing energy.
Households also experience curtailed energy use when their appliances break, need to be re-
paired, and are therefore unavailable for use, as well as when electricity supplies are unavailable.
The latter arises when electricity outages or fuel shortages occur at times when the household
would ordinarily be using energy to meet needs and create value. Curtailed energy use is thus a
key factor in the negative social value of energy, as it represents significant limits on the use of
energy to create social and economic value.
Figures 8 and 9 illustrate the broad outlines of the challenge of curtailment for households in
Freetown. For each set of appliances, the project estimated a level of simulated daily electricity
load based on a reasonable estimate of the hours of use of each appliance in the house and the
average energy consumption per hour of use for each appliance. For households with the basic
set of appliances, the simulated daily electricity consumption would be 4.7 kwh (Figure 8). By
contrast, those same households reported an average daily electricity consumption of only 3.8
kwh, and the majority of households fell well below the level of 4.7 kwh of daily consumption.
For households with the largest set of appliances, the gap was significantly higher: the corre-
sponding simulated daily demand for full appliance use would be 14.7 kwh (Figure 9), versus an
average level of actual daily electricity consumption 8.8 kwh. Both sets of data indicate that ac-
tual appliance use falls well short of potential appliance use, thus severely constraining potential
value creation from energy use.
Figure 8. Curtailment of energy use in Freetown households with a basic (B) set of appliances.
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Figure 9. Curtailment of energy use among Freetown households with the largest (B++) set of
appliances.
Building on these findings, we surveyed households to determine the causes and implications of
the curtailment of energy use. Figure 10 shows that, among households in Bo, Kenema, and Seg-
bwema, more than half of respondents (57%) indicated that they curtailed electricity use in order
to reduce costs, with one-third (34%) indicating that curtailment for cost reasons occurs at least a
few times per month. In a related finding, 39% of households that indicated that they curtailed
electricity use in order to reduce their electricity costs also responded that they faced circum-
stances that required them to reduce purchases of other essential services in order to pay their
electricity bill. Figure 10 also shows the frequency of such trade-offs for these households. To-
gether, these two findings demonstrate that a high fraction of households in Sierra Leone are be-
ing forced to limit energy use, and therefore subsequent value creation, because they cannot af-
ford their energy bills and also that high energy bills are forcing them to trade-off paying energy
bills against other key essential services, such as paying for food or clean water, which further
reduces household value creation. Added to the higher costs of energy, reported in the previous
section, which offset value created through the use of energy, many households appear likely to
be struggling with energy-based value creation. We therefore turn next to an assessment of the
net social value of energy for Sierra Leone households.
Figure 10. (left) The frequency with which households in Bo, Kenema, and Segbwema were
forced to reduce appliance use to reduce energy costs. (right) The frequency with which house-
holds that curtailed energy use to reduce costs also faced trade-offs that forced them to reduce
purchases of other essential expenses in order to pay their electricity bill.
Minimum daily electricity demand* for reliable utili-
zation of typical appliances in category ‘Basic ++’
14
Negative net social value of energy: As discussed earlier, the net social value of energy for
households is a critical factor in social and economic development. Put in its simplest form, net
social value of energy can be understood as the relative worth of the services provided to the
household through energy use, from lighting and cooking to thermal comfort (heating or cooling,
as appropriate) to revenue creation for household economies, measured against the cost of energy
to the household. For many households around the world, especially in societies and economies
that have strong cultural barriers between home and work, these services may be intangible,
meaning that even if they have value, payments for energy weigh against household income. Yet,
even in the most advanced industrial economies, household and work-based economies may be
less differentiated than is often assumed in energy policy and, especially, in the design of energy
access and affordability programs. Many small businesses are run directly out of households, and
the proportion is likely growing in the age of Internet businesses. And, in the context of the on-
going COVID pandemic, far more professional work is also happening within household spaces.
Energy use for revenue generation and for intangible household value creation is thus becoming
more important but has blurred, in Sierra Leone and around the globe.
In agricultural and low-income societies and economies like Sierra Leone, the differentiation be-
tween household and productive or revenue-centered uses of energy is especially low, especially
in the informal sector, which comprises the majority of the economy in Sierra Leone. In such
economies, the proportion of people who work outside the home to generate a source of income
that can offset “household” energy bills is therefore small. The net social value of energy for the
household is therefore an especially important measure of economic activity. If positive, it indi-
cates that households are generating more value from their use of energy than energy costs, and
each use of energy incremental adds positive economic returns. By contrast, if negative, it indi-
cates that households are generating less value from their use of energy than energy costs, and
therefore each use of energy is incrementally generating negative economic returns, undermining
not only household financial security but also economic prosperity and growth. The energy sys-
tem, in the context of a net negative social value of energy for households, is thus a source of
economic drag and poverty perpetuation, not only for the household but, more broadly, for its
community and for the nation as a whole (especially where the majority of households are expe-
riencing net negative social value of energy.
Two distinct approaches can potentially be used to measure the net social value of energy, in-
cluding both top-down strategies that evaluate the overall worth of energy to households (and/or
businesses, although we present only household-based calculations here) and bottom-up strate-
gies that evaluate each use of energy for its value in the household economy. Here we present the
results of our top-down measurements. We made two distinct measurements to estimate the net
social value of energy for households, shown in Figure 11. In the first, as described above, we
asked respondents to provide information about their current electricity expenditures and, sepa-
rately, to assess the value of how much their electricity use was worth, in terms of an ideal bill
that they would be willing to pay for the electricity service they received. On the vertical axis of
Figure 11, we report the difference between these two numbers, normalized to their estimate of
an affordable level of electricity expenditures. Our second measurement asked respondents to es-
timate how much they would be willing to pay for improved electricity service that provided suf-
ficient supply to serve their needs on a highly reliable basis. We report this measurement on the
horizontal axis of Figure 11, normalized to their current electricity expenditures.
15
Overall, Figure 11 shows that, for Sierra Leone, a significant majority of households are experi-
encing a net negative social value of energy, in all four of the communities we surveyed, both
with respect to the cost of their current electricity service, which is higher than the value of their
current service to the household, and with respect to expressing a strong willingness to pay for
improved electricity service. Not surprisingly, across all four communities, those households
with low levels of cost satisfaction (i.e., whose current electricity expenditures are far higher
than they can afford to ideally pay for their current electricity service) also have relatively little
willingness (or presumably ability) to pay for improved electricity service. Electricity is simply
too expensive for these households. On the other hand, those households that show a high will-
ingness to pay for improved electricity service (measured as a high negative utilization satisfac-
tion) tend to be those with a net positive or only small net negative social value of energy. These
differences across households suggests that net social value of energy can be used to differentiate
among households in ways that allow for targeted responses. We describe this use of social value
of energy measurements in the next section.
(a)
16
(b)
(c)
17
(d)
Figure 11. Net social value of energy measured across all four surveyed communities. Each dot
represents one household. Households with negative cost satisfaction report that their current
electricity expenditures are higher than the ideal worth of their electricity service. Households
with negative utilization satisfaction report that they had a positive willingness to pay for im-
proved electricity service. The horizontal axis is normalized to the household’s current electricity
expenditure. The vertical axis is normalized to the household’s ideal estimate of an affordable
electricity expenditure. Each graph presents data from households in a community: (a) Freetown;
(b) Bo; (c) Kenema; (d) Segbwema.
Disaggregation of user groups by social value of energy characteristics: One of the central
challenges for energy policy, historically, has been the disaggregation of customers for targeted
strategies. Electric utilities, in particular, adopted very early in their history a norm of providing
universal service to all customers on an affordable basis, which has historically mitigated against
differential treatment of customers, e.g., on rates. Modest exceptions to this policy are sometimes
made for low-income customers, e.g., through partially subsidized electricity rates (in Sierra Le-
one, monthly kwh electricity consumption is subsidized up to a threshold, e.g., 50 kwh); through
the provision of funds for electrical equipment purchases or upgrades (e.g., in the US, federal
weatherization assistance provides help for low-income households with upgrading some electri-
cal equipment to more efficient alternatives); or through bill payment assistance (e.g., in the US,
LiHEAP funds provide low-income households with short-term assistance paying electricity
bills). These programs are often limited in scope, however, which reduces their impacts.
Part of what limits the ability of policymakers to provide targeted assistance to households to re-
duce the impacts of energy systems on low-income communities is the lack of detailed data on
customer needs. This limitation is due to a common focus of electricity data collection on charac-
teristics of electricity supply (and to a lesser extent on patterns of electricity demand) rather than
on how users use energy, to what ends, and the value creation that results. The social value of en-
ergy methodology offers a potentially powerful tool for unbundling energy customers according
to detailed needs and opportunities for social value creation through energy use. This is
18
especially true of bottom-up approaches to social value creation, which disaggregate diverse pur-
poses and forms of energy use and their associated value creation (see Biswas et al. 2021). Even
top-down approaches can provide useful information, however, on different groups of energy us-
ers and the strategies necessary to improve their net social value of energy.
Consider, for example, the results for the people of Freetown shown in Figure 12, which reveals
at least five groups of households. Group A are those households that lie along the negative y-
axis, typically exhibiting very high levels of cost dissatisfaction, meaning that their current elec-
tricity expenses are very high in comparison to what they consider the worth or value of electric-
ity services to their household, as well as very low levels of willingness to pay (and, presumably,
ability to pay) for improved electricity services. Households in Group A are highly cost bur-
dened, meaning that they are paying much higher energy expenses than they can afford. Hence,
strategies for improving the social value of energy for these 20% of households will require find-
ing ways of reducing the cost of electricity relative to income or, vice versa, increasing the pro-
ductive use of energy or other strategies for improving revenue generation. By contrast, house-
holds in Group D, another 20% of households, or so, exhibit, generally, net positive social value
of energy along with a very high willingness to pay for improved electricity services. For these
households, generating additional social value of energy will stem from providing much more
reliable and substantial supplies of electricity. Group C is similar to Group D, except that they
report that their current electricity expenses are modestly too high. The largest group, Group B,
representing 35% of households, suffer from both currently unaffordable electricity expenses and
modestly high willingness to pay for improved services, suggesting that both affordability and
reliability constrain their current ability to use electricity to create social and economic value. Fi-
nally, Group E, another small group, appear generally satisfied with their current electricity ser-
vice, generating net positive social value but not broadly willing to pay more for improved ser-
vices.
Focusing in on willingness to pay for improved electrical service, this approach can also provide
comparative information both across and within communities. For example, Figure 13 illumi-
nates the different levels of willingness to pay for improved electrical service in Freetown, Bo,
Kenema, and Segbwema. Comparatively, the highest willingness to pay for improved electrical
service is in Segbwema (the poorest of the four communities), the only community we surveyed
without grid-based electricity. At present, portions of Segbwema are served by a solar and batter-
ies microgrid. By contrast, Bo and Kenema, both of which have a grid-based energy system but
with unreliable electricity at present. Perhaps households in Bo and Kenema see little oppor-
tunity or value in their current electricity service (which would be consistent with the low levels
of cost satisfaction measured in Figure 11 in Bo and Kenema) and therefore see little reason to
hope that improved electricity service would add much value. By contrast, households in Seg-
bwema may be under the impression (correctly or incorrectly) that grid-based electricity would
offer an improvement on the microgrid service and may thus be worth paying for.
19
Figure 12. Differentiating populations of electricity users through net social value of energy
methodologies.
(a)
FREETOWN
20
(b)
(c)
21
(d)
Figure 13. Conditional willingness to pay for more reliable and abundant electrical supply. Each
graph presents data from households in a community: (a) Freetown; (b) Bo; (c) Kenema; (d) Seg-
bwema.
Poorly functioning electrical appliance markets and policy: The high costs of electricity in Si-
erra Leone, relative to household income and expense levels, bear much of the weight in explain-
ing the overall net negative social value of energy measured in this project. Nonetheless, other
factors also contribute to this phenomenon. Of particular relevance in Sierra Leone are relatively
poor functioning electrical appliance markets and associated market policies. By poor function-
ing, we mean that Sierra Leone households, broadly, have relatively few electrical appliances
available and those that they do have available are, generally, of low quality and low efficiency.
As a result, the overall effectiveness of value creation from electricity supplies is low. Several
factors contribute, including: a lack of appropriate appliances in many households, even in Free-
town, but especially outside of the capital; low efficiency appliances, which mean that appliances
consume more energy per unit output, thus reducing net value creation due to higher energy costs
of operation; low quality appliances, which mean that appliances frequently break, not only re-
ducing their availability for value creating activities but also raising costs for maintenance and
repair; and unreliable electrical supply, which also reduces opportunities for using appliances
and creates voltage and frequency fluctuations that put appliances at risk of being damaged. In
addition, second order factors matter too. Appliance import markets favor low-quality appli-
ances, meaning consumers have little opportunity to buy higher quality options, as import poli-
cies do not regulate the quality of appliances. Customers also tend to favor low-quality appli-
ances, for their lower cost, and they tend to have fewer opportunities to purchase appliances, ex-
cept for cash at the point of sale, thus reducing their ability to pay for higher quality or higher ef-
ficiency options that might reduce their long-term expenditures.
The centrality of electrical appliance markets and policy to the energy-poverty nexus is visual-
ized in Figure 14. At the center of the figure is a positive feedback loop (in blue) that translates
available and affordable electricity, through the use of appliances, into social and economic
22
value for households, whether in the form of light, heating, cooling, motor power, or other en-
ergy services. Cutting across that is a negative feedback loop (in yellow) grounded in the cost of
electricity and the cost to purchase, operate, and repair appliances. If the balance of these two
loops is positive, then we define the results as generative and expect iterative improvement in
household wellbeing and capabilities. If the balance between the two is negative, then we define
the results as extractive and expect iterative reductions in household wellbeing and capabilities.
As described above, many factors (listed in red) can tilt the balance of the core loops toward
more negative outcomes, as a result of interactions between electricity system functioning and
appliance functioning, reducing the net social value of energy.
Figure 14. The role of appliance markets and policy in the energy-poverty nexus.
Pathways for enhancing social value of energy: Given the significant net negative social value
of energy observed for many households in Sierra Leone, as well as the array of factors that con-
tribute to reducing the social value of energy, transforming energy system functioning to genera-
tive, net positive social value will not be easy. On the other hand, the study was able to identify a
wide range of potential pathways for enhancing the social value of energy. These cover a range
of improvements in:
• Uses of energy that are productive, revenue-generating, or generate significant social
value creation;
• The availability and affordability of appliances necessary for value creation;
• The reliability of electricity supply, including fewer interruptions, improved control of
voltage and frequency, and longer hours of operation;
• The quality and efficiency of appliances;
• Reducing the financial burden on households to purchase electricity or fuel;
• Education about the social value and productive use of energy.
The household surveys in Bo, Kenema, and Segbwema indicated that one challenge is the limited
imagination of new ways to use energy in productive, revenue-generating, or value crating ways.
As shown in Figure 15, households identified a limited number of both existing and potential
23
future appliances that they see as contributing to high levels of value creation. A related study
collecting data in the field in Sierra Leone at the same time as ours also observed that households
anticipating future electricity service from a rural microgrid being built pre-purchased a similarly
limited array of appliances. Together, the two survey results show that, while households were,
in aggregate, able to identify a wide range of appliances that either created or could in the future
create value for the household, the large majority of responses were concentrated around a few
appliances, suggesting that households were not well acquainted with ways of using appliances
to generate income or value.
Figure 15. Households identified appliances that they already owned that they desired to use
without restriction from electricity supply (left) and appliances that they would like to acquire for
the purpose of generating new income (right). Note the dominance of the TV and refrigerator in
these two response sets.
Consistent with this result, the surveys in the same communities found that only a quarter of
households are currently using electrical equipment or appliances as a source of revenue or in-
come, and of those households, a significant majority are using electrical generators as their pri-
mary equipment, demonstrating the value of reliable electricity service. The uses of energy iden-
tified by these households are presented in Figure 16. For these households, a key strategy for
improving the social value of energy is to enable households to expand electricity service in
ways that extend their hours of operation and allow them to replace generator usage, which re-
quires very high fuel costs to power and is at risk during fuel shortages.
Survey respondents also identified a range of additional appliances that they desired to purchase
that could potentially, in the future, become a source of additional household income. Figure 17
shows the most common of these identified by Freetown households. It may be worth noting, as
we also observed earlier, the relatively limited imagination of respondents with regard to future
opportunities for acquiring new appliances that would increase value creation, whether for im-
proving household conditions or income.
24
Figure 16. Electric or fuel-powered equipment currently being used in Bo, Kenema, and Seg-
bwema to support work or livelihood/income generation.
One final observation is relevant about electrical appliance markets and policies. We asked appli-
ance retailers whether or not they were able to facilitate purchases of appliances via financial
mechanisms other than time-of-purchase cash sales. None of the electrical appliance sales shops
that were interviewed in Freetown indicated that they made credit available to purchasers, where
credit was defined as enabling customer access to the appliance prior to the customer making a
full payment (e.g., financing a loan to the customer for the amount of the purchase price). Half of
shops were able to offer installment plans to their customers, in which the customer made partial
payments over time and, when they’d paid the full amount, received the appliance. In general,
however, the shops that did offer installment plans served higher income segments of the market.
The implication of both findings is that, especially for the low-income households for whom tar-
geted appliance purchases might tangibly impact household income, no purchase options are
available except to purchase with cash, thereby reducing the accessibility of these technologies.
The lack of appliance financing mechanisms for low-income customers is an important part of
what constrains households to the relatively narrow sets of appliances currently owned, even in
the households with the largest number of appliances, as well as what limits the ability of house-
holds to acquire more efficient and higher quality appliances.
25
Figure 17. Identified needs and/or aspirations for future appliance ownership indicated by house-
holds in Freetown, along with the relevant social value potentially created by appliance use.
Some of the identified appliances have known value to household respondents, based on estab-
lished business models. For others, the potential use value is more aspirational. Use value is for
indoor comfort and convenience, avoiding spoilage of food (and thus reducing food costs and
health risks), and supplementary income. * indicates appliances for which purchase is strongly
conditional on both affordability of the appliance and affordability of the electricity to power the
appliance.
Implications for Energy Access Policy and International Development
The findings of this study have important implications for Sierra Leone and for a wide array of
efforts to enhance energy access and promote development around the globe, as the world ad-
vances progress toward the UN Sustainable Development Goals.
1. End high energy burdens for low-income communities: UN Sustainable Development Goal
7 calls for “affordable, reliable, sustainable and modern energy for all” by 2030 (SE4All 2022).
Unfortunately, in the implementation of SDG7, affordability has taken a backseat to efforts to
bring access to electricity to all of the world’s people. Indeed, energy affordability is often a pipe
dream for low-income and, especially, extremely low-income communities. All over the world,
from the richest to the poorest nations, those who are deepest in poverty routinely experience the
highest and most debilitating energy burdens, testifying both to the depth of dependence of to-
day’s societies and economies on energy resources to provide basic services for all as well as to
the relative meaninglessness of the concept of “affordability” in contemporary energy service
provision for poor communities. Affordability is generally measured against the financial capa-
bilities of the average customer, not those at the lowest end of the economic ladder (Brown et al.
2020.
26
This study provides a benchmark for measuring affordability for all. Access to electricity and
other forms of energy is not an unalloyed good. Under conditions for which the net social value
of energy for a household or community is negative, then access to energy erodes financial and
economic security. That’s why, in so many poor communities that first get access to electricity,
consumption surges in the first few months and, then, quickly, falls, sometimes to zero, as the
community realizes that the high cost of electricity is not worth it, in terms of value creation. It is
also why high-cost, privatized microgrids fail, in the absence of anchor clients, when their low-
income, rural customers simply do not have the ability to continue to pay, and when they are not
set up from the outset to create net positive social value for energy users.
Net positive social value creation should be a measure of the affordability of electricity and en-
ergy for low-income communities. Governments and the international development community
should stop pretending that providing high-cost electricity services to low-income communities
is an investment in economic development, unless they can demonstrate that the social value of
energy is positive for those communities. To drive social and economic development for low-
income communities, whether in Sierra Leone or in the United States or Germany, energy needs
to be provided at prices and in ways that enable and empower improved capabilities and net posi-
tive value creation.
Low-income communities around the globe face harsh constraints on their ability to escape pov-
erty and foster local social and economic development within their communities. High energy
burdens dramatically compound those constraints, not only draining financial resources directly
to pay for energy for household and community use but also raising the costs of all other goods
and services that embed energy use in their supply chains. As the world as a whole is witnessing,
today, as a result of escalating global energy prices, high energy costs significantly undermine
low-income communities, not only directly but through their broader inflationary impacts on the
prices of goods and services.
Over time, governments and international development institutions could make a major dent in
global poverty by recognizing that being able to generate a net positive return of value creation
on the use of energy is a basic condition for economic activity and thriving, and therefore that the
price of energy has to be set for all people at a level that enables net positive value creation to oc-
cur. That price, our data suggests, for low-income households in Sierra Leone, and by ex-
tension elsewhere, is a lot lower than current energy prices. If that price will not cover the
costs of the production and delivery of the energy, then governments and international develop-
ment and financial institutions and energy project developers need to recognize the importance
of investing in that infrastructure for the community.
2. Design energy projects to provide positive net social value creation: The challenge of en-
suring that energy projects and investments meet the standard of net positive social value of en-
ergy requires more than just a focus on energy prices. It also requires a clear-eyed look at energy
use and the ability of households, businesses, and communities to use energy in ways that create
real and meaningful value. For decades, governments and energy project investors and develop-
ers have understood the importance of the productive use of energy (Practical Action 2014; Ter-
rapon-Pfaff et al. 2018), and yet it remains the case that energy sector and financial institutions
around the world continue to build projects and make investments that pay little to no attention to
27
whether or not the users of energy will be able to use it in ways that create tangible or intangible
value. Our study results suggest a wide range of potential strategies for accomplishing that goal:
• Monitor social value creation and net social value of energy to enable targeted electricity
tariffs, policies, and investments: One strategy is to ensure that energy access projects
model, measure, and, on an ongoing basis, monitor the social value creation by energy
users. Designers of energy projects should anticipate and model initial energy use and so-
cial value creation as part of project design—and globally accepted standards should be
developed for appropriate methodologies for doing so—in order to ensure that projects
are appropriate for target communities. Operators and regulators of energy projects
should likewise measure social value creation in order to ensure that tariffs and policies
are appropriately designed in order to allow low-income communities to use energy to
enhance capabilities and that energy burdens are not instead draining financial resources,
debilitating economic potential, or otherwise imposing risks on communities that fore-
close economic and social development. Monitoring of social value creation will allow
routine determination of where and how the nexus between energy and economic devel-
opment is working as intended and where it is not, allowing for readjustment of tariffs,
policies, and investments as needed to ensure net positive social value creation.
• Integrate energy development into larger economic development and infrastructure plan-
ning: This study has demonstrated the intricate linkages needed to facilitate capability en-
hancement and social and economic development between the knowledge, skills, and
practices of household energy use, the appliances and instruments for using energy, and
the design of energy systems. Yet, too infrequently, energy projects and investments are
designed, implemented, operated, and regulated independently of other sectors of the
economy and infrastructure (Adshead et al. 2019). Especially problematic is the failure to
integrate investments in energy infrastructure with investments in the broader economic
infrastructures that will allow productive use of that energy in revenue generating enter-
prises. This involves not only integrating energy and economic planning across national
ministries but also ensuring that recipient communities are engaged in the design of spe-
cific projects in order to ensure that they can inform the project of particular opportunities
for using energy to grow the economy; can learn to use energy in productive and net posi-
tive socially valuable ways; and acquire the additional resources and equipment neces-
sary to use the energy in those ways.
• Ensure access to a diverse array of high-quality electrical appliances, especially for pro-
ductive use of energy: Providing access to electrical end-use appliances, especially for
productive use of energy, is critical not only for initial energy project design but also for
enabling the development of a thriving and diversified economy over time. This means
potentially setting quality standards for appliance markets but, more importantly, ensur-
ing that markets are providing diversified appliances and that people are able to access
the necessary financing, installment, or other tools necessary to acquire more expensive
tools as investments in their economic future.
• Develop programs to expand the imagination of, learning about, and opportunities for
revenue-generating electricity use among users: Net positive social value of energy is as
28
much about the imagination, knowledge, skills, and capabilities of users as of the accessi-
bility and affordability of energy. Yet, far too little attention is paid in energy projects
and investments to engaging energy users in the kinds of programs that would enhance
their ability to use energy productively and in an effective fashion. Indeed, many energy
projects and companies take alternative approaches, catering to imaginations that encour-
age non-productive and net negative social value uses of energy in order to artificially in-
crease energy consumption. Even basic elements of energy education, such as the long-
term cost savings offered by many investments in energy efficient technologies, are often
neglected, resulting in customers buying seemingly low-cost appliances that are, in real-
ity, low-quality, low-efficiency appliances that are more likely to break and need repairs
and entail higher energy costs to operate. Some governments have had success in explic-
itly linking training in business development with packages of electrical appliances that
provide individuals with business opportunities and the necessary knowledge, skills, and
equipment to implement them (Practical Action 2019).
• Linking SDG7 to other SDGs: One potentially effective strategy for increasing the social
value of energy for users is to design SDG7 energy projects in ways that are explicitly
linked to advancing other SDGs, whether poverty alleviation, food security, clean and af-
fordable water, or others (McCollum et al. 2018; Adshead et al. 2019). This ensures that
the project pays careful attention not just to providing energy but to doing so in ways that
result in clear positive social value creation and to ensuring that the other elements of the
project required for that social value creation to occur are also part of the package. Cross-
linking SDG goals has become in vogue in recent years. It should become the de facto
standard for development efforts.
• Leveraging the social value of energy and the reduction of the energy-poverty nexus to
enhance the bankability of energy projects: Two basic assumptions underlie the recent
privatization of energy access investments: that energy consumers will pay for the costs
of energy projects and that energy use will grow over time, allowing the energy business
to grow and make money. Neither assumption is particularly strong for low- and ex-
tremely low-income communities, who make up the vast majority of the world’s unelec-
trified populations. Few low-income communities have the disposable income to spend
on electricity, especially for non-productive uses (and, yet, the majority of such projects
focus on electrifying households for non-productive purposes). And, unless the social
value of energy is net positive, these communities are also unlikely to see economic
growth, especially in the short term. This should raise hard questions, for example, about
the bankability of energy projects where the net social value of energy is negative (van
Lith 2021). The latter implies that, over time, such projects would not see the kind of ex-
panded economic activity, value creation, and energy use expected. Indeed, many low-
income communities experience an initial surge of electricity use on initial access, but re-
duced use over time, as people see the negative impacts of high energy prices. Yet, sur-
prisingly, few if any financial institutions impose requirements to ensure that energy pro-
jects will lead to net positive social value creation as a condition of project financing. Ex-
plicit attention to net positive social value creation in the financing stage of projects
could, on the one hand, simply reduce private financing for energy access projects, which
would slow energy development. On the other hand, it could help project developers to
29
make explicit and design for strategies to enhance positive social value creation opportu-
nities and thus strengthen projects and bankability by empowering customers with greater
ability to pay and aligning growth incentives for communities and projects, rather than
incentivizing energy companies to find new and more innovative ways to extract finan-
cial resources from low-income communities.
Future Research Opportunities
Our study provides a foundation for significant future research into the social value of energy
and the energy-poverty nexus. Some of the most important potential future research studies for
following up these findings include:
Detailed, bottom-up calculations of household social value of energy and the energy-pov-
erty nexus: This study measured the net social value of energy using top-down, aggregate meth-
ods. The next step is to pair such measurements with detailed, bottom-up assessments of net so-
cial value creation that measure the full spectrum of household energy uses (e.g., through ethno-
graphic observation) and then seek to understand the valuation of each through a variety of meth-
ods. Such a study would allow differentiation of financial and non-financial valuation, as well as
help explain in more detail the functioning of the feedback loops that contribute to the creation
and perpetuation of the energy-poverty nexus. Such a study should look at both electricity and
fuel use (and perhaps also the use of food for physical labor by people or animals) in a symmet-
ric fashion.
Analysis of why households allow themselves to experience net negative social value of en-
ergy: Conceptually, over time, net negative social value of energy should erode household finan-
cial resources and broader capabilities, leaving people worse off and exacerbating poverty. We
see evidence in many cases that households quickly self-constrain consumption, where possible,
to reduce electricity and energy costs in such cases. This leads us to ask: under what conditions
do people perpetuate high, net negative social value energy consumption, why do they do so, and
what are the key factors that contribute to this outcome? Studies of these phenomena could pro-
vide important insights into how and why households in poverty are unable to escape over time
and what governments could do to help.
Detailed studies of social value of energy for small businesses and the informal sector of the
economy: This study focused primarily on calculations of the social value of energy for house-
holds and, to some extent, therefore, on the informal sector of the economy. However, it did not
isolate income producing activities of households for detailed analysis, nor did it work with
small or large businesses to carry out social value of energy calculations for productive and for-
mal economic sectors. Both would be highly valuable. By definition, businesses need to run at
net positive value creation levels in order to be profitable and continue in operation, and the rela-
tive levels of net positive value creation generated will have a significant impact on overall prof-
itability of individual businesses, efficiency of the economy as a whole, and likely on levels of
economic growth. A detailed study of the levels of net social value creation for businesses at dif-
ferent scales of operation and in different parts of the economy would be valuable, as would
providing insights into the factors that enable and constrain net positive social value creation.
30
Detailed studies of community-scale social value creation: Similarly, studies would be valua-
ble of the net social value of energy for communities, looking across the full range of household,
business, and civil society operations. Social and economic development is ultimately a compo-
site of activity among all three elements, and so an analysis across all three would be required to
fully understand how the net social value of energy relates to development processes, as well as
how it is experienced by different parts of the community and contributes to inequality.
Design and evaluation of pilot projects to test social value of energy enhancement strate-
gies: A final suggestion is to conduct studies of potential strategies for enhancing the social value
of energy, at all levels from household-scale experiments to policy experiments. Such studies
would need to be carefully co-designed with stakeholders to ensure both appropriate methodo-
logical design and appropriate co-benefit creation for participants.
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