Content uploaded by Clark Miller
Author content
All content in this area was uploaded by Clark Miller on Jul 15, 2022
Content may be subject to copyright.
An Applied Research Project by
Tempe, Arizona, USA Freetown, Sierra Leone
Funded under the: Funded by:Managed by:
Enhancing the Social and Economic Impacts of Energy Investments
through the Use of Energy to Create Value
Summary Report of Findings and Data
Sierra Leone, Africa
Note: This report is part of a package of three reports, which together
summarize the results of the project. The other two reports are:
Final Synthesis Report of Research
Data Collection Methodology
1. PI: Prof. Clark A. Miller, Arizona State University
2. Co-PI: Dr. Saurabh Biswas, Arizona State University
3. Co-PI: Mr. Wilbourne Showers, Centre for Economic Research and Capacity
Building
4. ASU Research Team: Prof. Nalini Chhetri, Prof. Mary Jane Parmentier, Prof.
Netra Chhetri, Ms. BrieAnne Davis
5. CERCB Research Team: Dr. Festus Lansana, CERCB Research Staff
Authors
1. Objectives and key findings
2. Data framework, sampling and collection methods.
3. Data and findings on household energy use
4. Data and findings on electrical appliance markets
5. The nexus of electricity, appliances, and household value creation
6. The potential value of energy use in public spaces
Contents
Objective 1: Improve Understanding of the Social Value of
Energy in Sierra Leone
Identify how households, businesses, and communities use energy to
create value
Analyze net value creation and determine whether it is extractive or
generative for energy users
Identify pathways for increasing the social value of energy
1. Objectives and Key Findings
Objective 2: Help Sierra Leone Institutions Build Capacity to
Improve the Value of Electricity Services through Research
Work with stakeholders to create research methods to study the social
value of energy
Create a community of practice among researchers and stakeholders
Help institutions develop strategies for using information about the social
value of energy to improve electricity services
1. Objectives and Key Findings
Key Finding 1: Sierra Leone Households Face High Total
Energy Burdens
Payments for electricity (utility bills) are modest in Sierra Leone, typically
less than 10% of household expenditures
Total energy burdens are high (average 42% of household
expenditures), however, once cooking fuel costs, backup generators or
batteries, and appliance repairs are included
Households are under-consuming electricity due to unreliable electricity
services, high costs, and broken appliances
1. Objectives and Key Findings
Key Finding 2: The Net Social Value of Electricity is Negative
(Extractive) for Most Sierra Leone Households
High electricity costs and burdens drain financial resources and
capabilities from households
Most households identify current electricity costs as higher than what is
affordable, given their other expenditures
Most households have a modest (but small) willingness to pay for more
reliable electricity services
1. Objectives and Key Findings
Key Finding 3: Multiple pathways exist for increasing the
social value of energy for Sierra Leone households
Increased reliability of electricity supply, access to higher quality
appliances, and lower cost electricity would all increase the social value
of energy
For some households, improvements in all three categories would be
required to generate positive social value of energy
Social value would also be improved through new opportunities to
productively use appliances to create economic and non-economic value
1. Objectives and Key Findings
This presentation focuses on data collected in Freetown, Bo, Kenema, and Segbwema in
urban and rural settings, collected in 2020 and 2021, used to evaluate the social value of
energy for Freetown households.
The social value of energy is defined as the social and economic value generated
through energy use, after subtracting the costs, burdens, and risks imposed by the energy
system.
When a user uses energy to produce a service, such as lighting a room or running a
sewing machine, they create value. At the same time, the energy costs money, as does
the appliance used. The net social value is positive if the value created is greater than the
costs of energy. The net social value is negative if the value created is less than the costs
of energy.
We therefore measured value creation and energy costs and burdens.
2. Presentation of Data and Findings
3. INSTITUTIONAL,
LEGAL, AND
BUSINESS
ECOSYSTEM
2. ENERGY
SYSTEM
1. SOCIAL VALUE
OF ENERGY FOR
USERS
Policy, legal and regulatory
institutions (local and national)
Governance, development agenda, public
engagement and social planning norms
(local and national)
Supply chains, market economics,
taxation, finance and climate change.
Technology, products
and services
Enterprise and human
resources
Skills, capacities, and
protocols
Relationships with local
economy, pollution and
climate change, equity
and social value
aspirations of users.
We collected data on the operation of the
energy system:
Home and neighborhood
Getting to and at the workplace
Public spaces, markets, schools, places of
worship, etc.
We collected data on how users used
energy and the value they derived
We collected data on the broader
ecosystem of energy services delivery:
2.1. Data Strategy
We started by identifying distinct neighborhood clusters with
similar characteristics.
Then we surveyed households within each neighborhood about
their energy use using several different methodologies to capture
multiple features.
2.1. Data Strategy
Neighborhood-level data was collected in multiple locations
across Sierra Leone:
•Freetown, multiple neighborhoods
•Bo
•Kenema
•Segbwema
2.1. Data Strategy
Samples:
HH –64
Retail –28
FGD - 5
Samples:
HH –26
Retail - 8
Samples:
HH –71
Retail –35
FGD – 4
Samples:
HH –50
Retail – 1
FGD –10
Samples:
HH –22
Retail – 8
FGD – 6
Samples:
HH-36
Retail –11
FGD - 6
Samples:
HH -16
Samples:
HH –23
Retail – 8
FGD - 4
Location NR:
HH-17
FGD – 7
Total Samples:
Households (HH)-325
Retail Stores –98
Focus Group Discussions (FGD) –42
Neighborhood Clusters and Data Sampling in Freetown
1. Identification and Mapping of
Neighborhoods
•Identifying spatial/demographic
clusters of people and energy
services
2. Energy Use in Households:
•Benefits, burdens and trade-
offs of energy use.
•Effects of above on overall
well-being/poverty
•Opportunity areas
3. Mapping of Energy Services &
Institutional Ecosystem:
•Roles of energy service and
devices markets, technologies,
and service providers in 1 & 2.
4. Utility of energy in public spaces and
services:
•Existing value of public spaces and services.
•Role of energy service in enhancing or limiting
value.
•Potential for enhancing value.
Method: Scoping surveys
Method: Interviews
Method: Interviews
Method: Focus group discussions
2.2. Data Collection Methods
For each neighborhood, we collected a range of data.
3. Data Presentation
3.1. Household Survey Demographics –Freetown
3.2. Household Energy Use –Freetown
3.3. Household Appliances –Freetown
3.4. Social Value of Electricity –Freetown
3.5. Pathways to Improving Social Value –Freetown
3.6. Results from Bo, Kenema, and Segbwema
We present data describing households in these neighborhoods
and their energy use.
Across the 8 neighborhoods, we surveyed 343 households, of
which 317 are included in this report.
65% of respondents were male, 35% female. 23% of our sample
were female heads of household.
142 had an EDSA (local utility) electricity connection only.
170 had both an EDSA connection and a backup system.
5 had a private connection or standalone system.
3.1. Survey of Household Energy Use -Freetown
Income (Le) %
Up to 1M 6.5
1-3M 31
3-5M 7
5-8M 10
8-10M 3
Over 10M 4
NR 38.5
Income Distribution of
Sampled Households
Percentage of households that own:
•Back-up power supply ~ 45%
•Power correction devices~ 31%
Percentage of households that conduct:
•Home based work using electrical appliances ~ 18%
•Home based work as primary income ~ 74%
Percentage of households that own different
configurations of electrical appliances
%HH
Basic appliances (B)
Iron, fan, light bulbs, TV, music/entertainment system
14%
Basic+ appliances (B+)
Basic appliances + refrigerator, home theater, water heaters
63%
Basic++ appliances (B++)
Basic+ appliances + air conditioner, multiple refrigerators &
TVs, microwave, rice cooker/electric cooker, blender, water
heaters, water filter, washing machine, water pumps
23%
3.1. Characteristics of Household Appliance Ownership and Use
Analyzing this data, we were able to get a robust picture of the many different
components of energy costs and burdens faced by Sierra Leone households.
3.2. Household Costs and Burdens of Energy Use
Each month, households spent the highest on food (Avg. Le 0.94 Million)
Total energy expenses (including electricity, cooking fuel and backup
power) were the second highest monthly expense (Avg. Le 0.39 Million)
3.2. Household Costs and Burdens of Energy Use
Finding 1. Energy
expenses are high.
% HH Expense
•As percentage of overall
household expenses each month,
energy expenses add up to ~15%
for electricity, backup supply, and
cooking fuel.
•Adding fuel or fare for transport
raises to ~20%.
•Added together, energy,
transportation and water make up
~30% of average expenses, going
as high as 40% in many cases.
Note: N=195 households supplied complete expense
data and percentage distributions are calculated for only
those households.
3.2. Household Costs and Burdens of Energy Use
Finding 1. Energy
expenses are high.
In the past year, the surveyed
households spent an estimated Le 29.6
million in appliance repair.
This equals an average Le 96,700 per
household.
3.2. Household Costs and Burdens of Energy Use
Finding 2. Frequent appliance
repairs add to energy costs.
Annual appliance repair costs
Percentage of households reporting appliance repairs
54% of households reported needing
to repair their appliances on 1 to 3
occasions in the past year.
Refrigerators and televisions are the most
frequently repaired appliances
Percent of
households
indicating
the need to
repair each
appliance in
the past
year.
3.2. Household Costs and Burdens of Energy Use
Finding 2. Frequent appliance
repairs add to energy costs.
Median income per capita for Sierra Leone (2022)
= USD765 / Le 7.65 million (source: World Bank)
Total Electricity Burden = utility bill + backup electricity sources (generators and batteries) + cost of appliance repairs
Total cost of electricity for
Freetown households (annual
average) = Le 3.2 million
Average annual cost
of using electricity in
Freetown is Le 3.2
million
For a single median
income household,
this translates to an
annual electricity
burden of ~ 42%
Finding 3. Total
annual financial
burden of using
electricity is high.
3.2. Household Costs and Burdens of Energy Use
% Households
Higher costs of basic amenities
and frequent emergency or
unplanned expenses induce
elevated cost sensitivity in
appliance purchasing choices:
-More than 60% households buy
appliances when it is essential,
when the price of buying and
operating seems affordable, and
the appliance can be locally
repaired –all cost related
motivations
-By contrast, the reputation and
quality of the appliance are a
primary motivation only for ~35%
of households.
-This sentiment has implications for
the transition to higher quality and
more efficient appliances, and
opportunities for market and policy
interventions to shift consumer
preferences.
Effect of cost burdens on
appliance buying sentiment
3.3. Household Appliance Purchase and Use
Average units of electricity (kilowatt-
hours, kwh) consumption for the
surveyed population ranges from ~23
kwh / month to ~1436 kwh / month.
Daily average consumption ranges
from ~0.75 kwh to ~48 kwh.
Is this sufficient for satisfactory
operation of the appliance currently
owned by the household?
3.3. Household Appliance Purchase and Use
Finding 4. Households are
using their appliances
infrequently.
Different households in Freetown have different sets of electric appliances.
We grouped these into three categories: Basic, Basic+ and Basic++.
3.3. Household Appliance Purchase and Use
Percentage of households that own different sets of electrical
appliances
%HH
Basic appliances (B)
Iron, fan, light bulbs, TV, music/entertainment system
14%
Basic+ appliances (B+)
Basic appliances plus refrigerator, home theater, water heaters
63%
Basic++ appliances (B++)
Basic+ appliances plus air conditioner, multiple refrigerators & TVs,
microwave, rice cooker/electric cooker, blender, water heaters, water
filter, washing machine, water pumps
23%
Daily consumption to remain within the
subsidized ‘first 50 kWH/month’
Minimum daily electricity demand* for reliable utilization of typical appliances in category ‘Basic’
Simulated demand with full use
Avg. Utilization gap of ~ 1 unit/day
3.8 kWh
Appliance kWH/hr # of Appliance Hours of Use Units Required
12W LED 0.012 2 6 0.144
100 W
Incandescent 0.1 2 6 1.2
Iron 1.08 10.25 0.27
Ceiling Fan 0.08 212 1.92
65 in Plasma TV
0.19 1 6 1.14
Total 4.67
* Ignoring supply induced inefficiencies (power quality, stop-start cycles due to power cuts) and
assuming standard ratings of new appliances.
Power ratings/Units per day estimates from https://energyusecalculator.com/index.html
Hours of use estimates from observations of sample homes
Most households are using
their appliances less
frequently than would be
expected for regular use.
We simulated the electricity
demand that would be
required for regular use (see
table).
The difference between the
simulated and actual demand
was ~1 kwh / day for the
’Basic’ appliance set.
3.3. Household Appliance Purchase and Use
Minimum daily electricity demand* for reliable utilization of typical appliances in category ‘Basic +’
Simulated demand with full use
Avg. Utilization gap of ~ 2.3 units/day
4.8 kWh
Appliance kWH/hr # of Appliance Hours of Use Units Required
12W LED 0.012 2 6 0.144
100 W
Incandescent
0.1 2 6 1.2
Iron 1.08 10.25 0.27
Ceiling Fan 0.08 212 1.92
65 in Plasma TV
0.19 1 6 1.14
Refrigerator 2.4
Total 7.07
* Ignoring supply induced inefficiencies (power quality, stop-start cycles due to power cuts) and
assuming standard ratings of new appliances.
Power ratings/Units per day estimates from https://energyusecalculator.com/index.html
Hours of use estimates from observations of sample homes
3.3. Household Appliance Purchase and Use
For households with the
’Basic+’ set of appliances,
the gap between expected
(simulated) and actual daily
electricity demand was
even higher: 2.3 kwh / day.
Minimum daily electricity demand* for reliable
utilization of typical appliances in category
‘Basic ++’
Simulated demand with full use
Avg. Utilization gap of ~ 5.9 units/day
8.8 kWh
Appliance kWH/hr # of Appliance Hours of Use Units Required
12W LED 0.012 2 6 0.144
100 W
Incandescent 0.1 2 6 1.2
Iron 1.08 10.25 0.27
Ceiling Fan 0.08 310 2.4
65 in Plasma TV 0.19 2 6 2.28
Refrigerator 2.4
Water Heater 3.2 10.5 1.6
AC Window 0.9 1 4 3.6
Microwave 1.4 10.5 0.7
Blender 0.4 10.2 0.08
Total 14.67
* Ignoring supply induced inefficiencies (power quality, stop-start cycles due to power cuts) and
assuming standard ratings of new appliances.
Power ratings/Units per day estimates from https://energyusecalculator.com/index.html
Hours of use estimates from observations of sample homes
For households with the
’Basic++’ set of appliances,
the gap between simulated
and actual daily electricity
demand was highest:
5.9 kwh / day.
3.3. Household Appliance Purchase and Use
More than half the surveyed households
reported that they have had to curtail their use
of the appliances they own due to:
•Unavailability of electricity when appliance
use is needed or desired
•Need to control the operating costs of the
appliance and reduce electricity costs
•Limited use of appliances or preventive shut
down to prevent damage to appliance due to
poor quality of electricity supply (e.g., voltage
or frequency fluctuations)
Why are households using their appliances less
frequently than they might?
3.3. Household Appliance Purchase and Use
To estimate the social value of electricity realized by households, we measure two
complementary quantities that each assessed how satisfied the household was with its
electricity service:
1. In relation to their overall household expenses, we asked households to estimate
what level of electricity costs would be affordable for their current electricity service.
Most households indicated that they were currently paying more for electricity than this
“affordable level”.
2. Separately, we asked households to estimate how much they would conditionally
be willing to pay for reliable electricity service. Most households indicated they
would be willing to pay a bit more, but not a lot.
Together, the two measures give an indication of how valuable the household considers
electricity (both at current service levels and in abstract).
3.4. Social Value of Electricity to Households
The Realized Social Value of Energy estimates the perceived value that the household derives from energy use by measuring
satisfaction with the current cost and reliability of electricity service from EDSA. This is measured using two variables:
1. Satisfaction with Electricity Cost –how satisfied is the household with their current electricity costs?
Estimated as the normalized difference between the current household electricity bill (Current Cost) and an affordable electricity
budget (Affordable Cost). The latter is estimated by the household based on factors like income and expenses for other essential
services.
[ (Affordable Cost –Current Cost) / Affordable Cost ]
Households with low (negative) cost satisfaction face greater cost burdens and trade-offs between paying electricity bills, paying
other essential expenses, and growing savings, thus reducing their overall financial and economic capability.
2. Satisfaction with Electricity Use –how satisfied is the household with the reliability of their electricity service?
Estimated as the willingness to pay (WTP) additional Leones in addition to their current electricity bill (Current Cost), reflecting
the additional value and well-being of the household that would be obtained from more reliable electricity service.
Households with high WTP above current costs show significant unmet demand for reliable electricity and so demonstrate a
higher value of electricity service.
[ -(WTP / Current Cost) ]
3.4. Social Value of Electricity to Households
Households indicated that reliability could be improved if:
•Electricity supply was available when they needed or desired to use appliances.
•They could avoid the need to pay for backup supply.
•The utility more quickly fixed faults and addressed customer complaints.
•Electricity supply experienced reduced voltage fluctuations and, especially, fewer
extended periods of low voltages that render appliances useless and cause
refrigeration loss.
•Electricity supply experienced reduced current fluctuations and, especially, those
that cause equipment damage.
3.4.1. Conditional Willingness to Pay
If the reliability of electricity improved, how much would
your household be willing to pay in additional electricity
costs? What would it mean to improve reliability?
67% of respondent are
willing to pay more for more
reliable electricity.
Of those, 60% are willing to
pay up to Le 50,000 / month,
and 40% are willing to pay
more than 50,000 / month.
WTP additional Le/month for reliable electricity supply from EDSA (Households = 199)
3.4.1. Conditional Willingness to Pay
Current Electricity Bill is Affordable
Current Electricity
Bill is Unaffordable
Demand for Reliable
Electricity is Currently Met
Demand for Reliable Electricity
is Not Currently Met
Satisfaction with Electricity Cost
Satisfaction with Electricity Use
Satisfied with current
electricity bill, potential
for using more reliable
electricity
Dissatisfied and
burdened with current
electricity bill, potential
for using more reliable
electricity
Dissatisfied and
burdened with current
electricity bill, no
additional potential for
using more reliable
electricity, potential
over-consumption
Satisfied with current
electricity bill, no
additional potential for
using more reliable
electricity, potential
over-consumption
3.4.2. Realized Social Value of Energy
N = 325
Surveyed households plotted on the cost vs use grid.
Each dot represents one household.
3.4.2. Realized Social Value of Energy
WTP = Current bill
Use Gap -Degree of unmet electricity demand
compared to desired levels of reliable electricity use
Affordability Gap -Intensity of
cost burden compared to
affordable cost for the
household
Current bill = 3x Affordable bill
WTP = Current bill
Use Gap -Degree of unmet electricity demand
compared to desired levels of reliable electricity use
Affordability Gap -Intensity of
cost burden compared to
affordable cost for the
household
Current bill = 3x Affordable bill
Groups:
A. Highly Cost Burdened: Current costs are so unaffordable that household has no WTP for
potential improvements from higher reliability of service (~20% of households)
B. Cost and Reliability Burdened: Current cost is unaffordable, however household estimates
some potential increased value creation from higher reliability of service, and therefore a
somewhat higher WTP (~35% of households)
C. Reliability Burdened: Current cost is unaffordable, however household estimates
significantly higher value creation to potentially future WTP for reliable service (~10% of
households)
D. Highly Reliability Burdened: Unmet demand and existing ability to pay for higher reliability
E. Satisfied: Satisfied with current cost and quality of service
A
B
E
D
C
In addition to estimating the current realized social value of energy, our project
also sought to identify pathways to increasing the social value of energy for
Sierra Leone households.
Based on our research, we find that increasing the social value of energy
can be done via three major pathways:
•Decreasing the costs and burdens of electricity
•Increasing the reliability of electricity service
•Finding new ways for households to generate added value from their use of
electricity
3.5. Pathways to Creating Social Value through Energy Use
Value creation pathways link willingness to pay for reliable electricity
with both economic and non-economic value of energy use.
Non-economic
•Food waste avoidance by continuous operation of
refrigerator
•Prevent damages to appliance by reducing voltage
and current problems
•Reduce dependency on and cost of running a backup
generator or battery
•Lights, TV, fans, making housework easier and study
time for children
•Providing security and safety at night
Economic
•Direct income generation
•Productivity improvements at work, by saving time
and effort in other activities
“…Low voltage or too high voltage, interrupted power supply when you need
it most -even with all these the energy company does not pay for damages!”
–A homeowner in Freetown
3.5. Pathways to Creating Social Value through Energy Use
Reducing average cost burden by Le 220,000 would significantly improve affordability for highly cost burdened
households (Group A):
•Excessive cost dissatisfaction limits household’s ability to visualize future value of electricity.
•They are extremely cost burdened and vulnerable (highly cost sensitive) homes (~20% of the sample
households).
•Average cost burden = Le 220,000
•Cost burden includes electricity bills, costs to buy and repair appliances, and costs to purchase and operate
backup power systems
Finding 1. For some
households, reducing total
electricity burden is key.
WTP = Current bill
Doubling reliability and keeping electricity rates unchanged would
improve social value of electricity for Group C (~10% of households)
Assumption-Doubling reliability of service, indicated by a WTP = Current Bill line,
requires available hours of service to double and eliminate quality issues.
Finding 2. For other
households, increasing
reliability is key.
Assumption-Doubling reliability of service, indicated by a WTP = Current Bill line,
requires available hours of service to double and eliminate quality issues.
Doubling reliability and reducing average electricity cost burden by
Le 220,000, together, would improve social value of electricity for
Group B (an additional 35% of households)
WTP = Current bill
Finding 3. For some households, both
lower costs and increased reliability will
be needed.
*Strongly conditional
to affordability of
appliance &
electricity bill
Tangible use
value in future
Appliance Ownership
needs/aspirations
Social Value
Fans
Indoor Comfort
Electric cooking
Air Conditioners*
Refrigerators*
(Multiple, Larger, More use)
Avoid Food Spoilage
Supplementary Income
Ice cream, Popcorn making
machine
Computer, Copier, Printer
Electric Sewing Machine
Power tools
Washer-Dryer
Screens & Entertainment
systems
Use value established
3.5.1. Aspirations for Appliance Ownership
Another important
pathway for increasing
the social value of
energy is to enable
users to acquire
appliances that create
value for the household.
Unless resolved, high
repair costs will present
a barrier to this
pathway.
Finding 4.
Some
households
will benefit
from new
opportunities.
Households owning –
•Back-up power Supply:
•Petrol Generators ~ 16%
•Self-powered appliances ~16%
•Solar Panels ~10%
•Power Correction devices ~ 41.5%
•Vehicles (2 or 4-wheeler) ~ 36%
Households conducting –
•Home based work using
electrical appliances and
back-up supply ~ 31%
Female : Male respondent =
110 : 107
Female as Sole Income of
HH = 25
Income (Le) %
Up to 1M 5
1-3M 45
3-5M 25
5-8M 10
8-10M 5
Over 10M 5
NR 5
Appliance Ownership Categories %HH Bo Kenema
Basic (or B)
(Iron, Fan, Bulbs, TV, Music/Entertainment system)
26.5 % 29% 24%
Basic + (or B+)
( Basic + Refrigerator, home theater, water heaters)
61.2% 63% 60%
Basic ++ (or B++)
( Basic++ AC, multiple Refs & TVs, microwave, rice
cooker/electric cooker, Blender water heaters, water filter,
Washing machine, Water pumps)
12.3% 8% 16%
Total Surveys = 221
Surveys Included (N) = 219
(Bo-108, Kenema-111)
Utility connection only: 135
Utility + Backup systems
(Generators, Rechargeable Batteries,
Solar Powered devices):
84
Neighborhood Clusters =
20 (Bo), 16 (Kenema)
Cooking Fuel:
•Charcoal + Firewood and/or gas ~ 91%
•only Charcoal ~ 35%
•only Firewood ~ 9%
•Only Gas = 1 HH
3.6. Household Survey Results –Bo and Kenema
Income Distribution
Female : Male respondent =
31 : 23
Female as Sole Income of
HH = 08
Income (Le) %
Up to 1M 13
1-3M 70
3-5M 0
5-8M 0
8-10M <1
Over 10M <1
NR <1
Appliance Ownership Categories %HH
Basic (or B)
(Iron, Fan, Bulbs, TV, Music/Entertainment system)
55%
Basic + (or B+)
( Basic + Refrigerator, home theater, water heaters)
45%
Basic ++ (or B++)
( Basic++ AC, multiple Refs & TVs, microwave, rice
cooker/electric cooker, Blender water heaters, water filter,
Washing machine, Water pumps)
0%
Total Surveys = 54
Surveys Included (N) = 53
Minigrid connection only: 37
Petrol Generator: 0
Solar panels: 2
Rechargeable batteries and
devices: 17
Neighborhood Clusters = 6
Income Distribution
Households owning –
•Power Correction devices ~ 42.5%
•Vehicles (2 or 4-wheeler) ~ 5%
Households conducting –
•Home based work using
electrical appliances and
back-up supply = 5
Cooking Fuel:
•primarily Charcoal (with firewood and/or gas) ~ 100%
•only Charcoal ~ 63%
•only Firewood = 0%
•only gas = 0%
3.6. Household Survey Results –Segbwema
*Note: Food
expenses could
not be
separately
estimated
during pilot
phase and
hence was
captured
together with
miscellaneous
monthly
expenses
3.6.1. Household Expenses -Bo
3.6.1. Household Expenses -Bo
3.6.1. Household Expenses -Kenema
3.6.1. Household Expenses -Kenema
3.6.1. Household Expenses -Segbwema
3.6.1. Household Expenses -Segbwema
Stacking monthly Expenses (Bo)
3.6.2. Household Energy Burden -Bo
Cumulative Annual Energy Burdens (Bo)
3.6.2. Household Energy Burden -Bo
Stacking monthly Expenses (Kenema)
3.6.2. Household Energy Burden -Kenema
Cumulative Annual Energy Burdens (Kenema)
3.6.2. Household Energy Burden -Kenema
Stacking monthly Expenses (Segbwema)
3.6.2. Household Energy Burden -Segbwema
Cumulative Annual Energy Burdens (Segbwema)
3.6.2. Household Energy Burden -Segbwema
Annual cost of electrical hardware maintenance (Bo)
Average/household cost = Le 327500
3.6.3. Household Repair Costs -Bo
Annual cost of electrical hardware maintenance (Kenema):
Average/household cost = Le 340000
3.6.3. Household Repair Costs -Kenema
Annual cost of electrical hardware maintenance (Segbwema):
Average/household cost = Le 145000
3.6.3. Household Repair Costs -Segbwema
Additional amount (per month) willing to pay for
realizable and high-quality electricity supply
Willingness to pay greater than zero for:
•Bo: 66% households
•Kenema : 64% households
•Segbwema: 66% households
3.6.4. Willingness to Pay for Improved Energy Services –Bo, Kenema, Segbwema
Improving social value potential of electricity by improving
affordability for overburdened households:
•Excessive cost dissatisfaction limits household’s ability to
visualize future value of electricity.
•They are extremely cost burdened and vulnerable (highly
cost sensitive) homes (~ 52% of the sample households).
•Average cost burden = Le 279,000
3.6.5. Social Value of Energy -Bo
Improving social value potential of electricity by improving
affordability for overburdened households:
•Excessive cost dissatisfaction limits household’s ability to
visualize future value of electricity.
•They are extremely cost burdened and vulnerable (highly
cost sensitive) homes (~ 22 % of the sample households).
•Average cost burden = Le 38,230
3.6.5. Social Value of Energy -Kenema
Improving social value potential of electricity by improving
affordability for overburdened households:
•Excessive cost dissatisfaction limits household’s ability to
visualize future value of electricity.
•They are extremely cost burdened and vulnerable (highly
cost sensitive) homes (~ 26% of the sample households).
•Average cost burden = Le 66,428
3.6.5. Social Value of Energy -Segbwema
25% of households
generate primary or
supplemental
incomes through
business activities
co-located with the
home premises,
using electricity
powered operations
Generators are used to
power freezers and
refrigerators for food
and drinks in retail
businesses and
restaurants, operate
machinery (metal
works, carpentry, auto
repair etc.)
Longer hours of operation and replacement of
generator are recognized as critical factors to
enhancing incomes by this group
3.6.6. Opportunities for Improving Productive Use of Energy –B, K, S
62% Households identify
new appliances that can
supplement or generate new
income
(* conditional to affordable
appliance/machinery, reliable and
affordable electricity, and capital
to purchase both.)
3.6.6. Opportunities for Improving Productive Use of Energy –B, K, S
*Electric Cooking appliances include Microwave oven, Blender, Rice
Cooker, Stovetop/Hotplate
Aspirations for new
appliances for
domestic use
3.6.6. Opportunities for Improving Productive Use of Energy –B, K, S
57% Households limited energy use to control bills
Among households that curtail energy use for cost
control, 39% compromised expenses on other
essential services to pay for electricity
Tensions between electricity availability and utilization, household expenses, and opportunities
i. Curtailed electricity use due to cost burdens
3.6.7. Measuring the Energy-Poverty Nexus –B, K, S
If electricity is
affordable, a
strong desire to
use existing
appliances can
be found.
3.6.7. Measuring the Energy-Poverty Nexus –B, K, S
~ 35% of the households reported curtailments due to lack of supply during the
times when there is a need to operate appliances.
ii. Curtailed use due to availability of energy and appliances
3.6.7. Measuring the Energy-Poverty Nexus –B, K, S
3.6.7. Measuring the Energy-Poverty Nexus –B, K, S
iii. Income fluctuation scenarios reveal current competing pressures on expenditure for essential goods
and services
Q: Other than energy, what other
goods and services would you
spend the extra income on ?
(Note some respondents state cooking fuels
and electricity. These may be treated as errors.
No response choices were provided, and
respondents narrated their response)
3.6.7. Measuring the Energy-Poverty Nexus –B, K, S
Q: If your monthly
family income
REDUCED by Le
100,000, which
expense would you
be forced to cut
down on?
3.6.7. Measuring the Energy-Poverty Nexus –B, K, S
4. Improving Electrical Appliance Businesses
As can be observed in the prior slide, appliances are critical both to the creation of
social value from energy and to whether net social value is positive or negative.
Appliances convert electricity into services (light, heat, mechanical power,
computing, communication, etc.) that then create value for the user.
More appliances = more services = more pathways to potential value creation.
But, as we also noted, appliances cost money, as do appliance repairs, which add
to household energy burdens.
The difference between value creation and costs or burdens determines whether
net social value is positive or negative.
4. Improving Electrical Appliance Businesses
To explore appliance markets, and their relationships with households,
the project conducted two surveys:
The first surveyed 98 owners of electrical appliance businesses in
Freetown.
The second surveyed 31 owners of electrical appliance businesses in Bo
and 25 in Kenema. We found 0 electrical appliance businesses in
Segbwema.
The purpose of both surveys was the same: to better understand trends
in appliance markets and the challenges facing businesses trying to get
more appliances into users hands.
4.1. Electrical Appliance Business Trends in Freetown
Increasing Sales
Fans and stand fans
Televisions
Cables and extension cords
Projected Growth
Plasma TV
Refrigerator
Extensions cords and power correction
equipment
Large stand fans
Energy efficient lights
Cooking appliances
Current areas of sales growth
identified by appliance retailers
Anticipated areas of future sales growth
identified by appliance retailers
This growth in sales is principally driven by
expanded electrification of neighborhoods. Note
the match to the ‘Basic’ category of appliance
ownership introduced earlier. This is mostly new
households entering at the lowest tier. Future growth is still largely ‘Basic’ but adds
potential added value creation items, such as
refrigerators and cooking appliances.
4.2. Opportunities to Enhance Customer Value Creation in Freetown
Appliance retailers highlighted several areas of
improvement that would increase the satisfaction
of their customers and improve their sales.
Appliance retailers also identified the
frequency of needed appliance repairs
as a key concern
One area of potential improvement was the creation of
financing programs that would allow buyers to purchase
appliances on credit. Even installment programs remain
only partially available.
Customer
Transactions
%Stores
Installments* ~ 45%
Financing 0
*Mostly by businesses with customers in high and
middle income range
Most Damaged/Repaired Top Causes
Lightbulbs, extensions and sockets
•
Voltage and current fluctuations
•
Low quality of appliances
•
Physical damage due to handling
Televisions and entertainment systems
Refrigerators / freezers
Improving Customer Satisfaction/Sales
Improving electricity supply
Financial support for ownership of new appliances
Lowering appliance cost by reducing supply chain costs
Business Enablers Business Barriers
Credit from suppliers Taxes and customs fees
City Council registration Currency fluctuations
Loans High interest rates / collateral
4.3. Future Opportunities for Businesses in Freetown
Business Growth Areas Conditions
Manufacturing and refurbishing
(extension cords and power
conditioning devices, light bulbs, TV)
•
Technically trained workforce
•
Co-investment
•
Consumer awareness
•Community engagement managers
Neighborhood electricity production
They also identified factors that made it harder
and easier to expand their business.
Business owners also identified areas
where there might be significant future
business opportunities, beyond
appliance sales –as well as what it
would take to
Increasing Sales
Entertainment Appliances (Speakers,
Musical Sets, DVD player)
Lightbulbs & Standalone lights (Battery
and Solar)
Televisions
Most Damaged/Repaired Top Causes
Television
•
Voltage & Current
Fluctuations
•
Quality of Appliance
•
Physical damage from
handling & transport
Entertainment Appliances
Fans
Customer Transactions %Stores
Installments* ~ 68%
Financing** ~ 37.5%
Business Enablers Business Barriers
Credit from Suppliers High interest rate/Collateral
Short term Loans Currency fluctuation
Cash payment capacity of
customer base fluctuates
*More common than Freetown, irrespective of customer economic
status or neighborhood
**Needs further investigation since this is in stark contrast to
Freetown
+Note that Refrigerators/Freezers are not a dominant appliance sold or repaired here, compared to Freetown
4.4. Electrical Appliance Business Trends in Bo and Kenema
Refurbished Appliance Market
Refrigerator
Television
Cooking Appliances (Blenders, Microwave, Rice
Cookers and Kettles)
Entertainment Appliances
(Speakers/Amplifiers, Musical Sets, DVD
player)
Fans
Solar Products
Radio + Bluetooth Speaker + Light
Portable Fans
Home Lighting System
* 57% of surveyed retailers stock refurbished appliances and
43% of surveyed retailers reported between 25-80% of their
revenue from refurbished appliances sales.
32% of the retailers sell solar powered
appliances or panels
Retailers don’t stock solar panels or rooftop
solar systems due to low demand, higher
capital cost and lack of wholesale dealers
4.4. Electrical Appliance Business Trends in Bo and Kenema
5. The Nexus of Electricity, Appliances, and Household Value Creation
What we observe in Freetown is an example of the energy-poverty nexus, in
which energy insecurities and financial insecurities create loops that feed back on
one another to exacerbate poverty and inequality and undermine the capabilities of
households to improve their quality of life and pursue new economic opportunities.
Social value creation offers an opportunity to reverse these feedback loops and
instead create improved household outcomes.
In the next slide:
•Blue labels mark positive social value creation
•Brown labels mark negative social value creation
•Green labels mark opportunities to improve social value creation
5. The Nexus of Electricity, Appliances, and Household Value Creation
Electrical
Appliance
Markets
Household
Capabilities
and Finances
Electricity
Supply
Appliances
transform
electricity into
value for
households
Appliances cost
money to buy,
operate, and repair
Reliable
electricity
enables
appliances to
operate
Unreliable
electricity
disables and
damages
appliances
Electricity
costs
money Unreliable
electricity
requires buying
even higher cost
backup supplies
Reducing electricity prices
lowers financial burdens
and enables more use
Making electricity
more reliable reduces
expenses for backup
power
Making electricity more
reliable reduces expenses
for appliance repair
Making electricity more
reliable reduces down
time for appliance use
Making appliances more
reliable reduces repair and
replacement costs Making appliances
more efficient reduces
electricity costs
Enabling households to buy and
operate appliances reliably
creates new economic and non-
economic opportunities
If electricity is too costly or
unreliable, households
can’t benefit from it and
will self-curtail use
Making electricity more
reliable increases demand
for appliances from retailers
There are many paths
to improved social
value creation.
Blue = positive
social value
Brown = negative
social value
Green = opportunity
to improve social
value creation
5. The Nexus of Electricity, Appliances, and Household Value Creation
Electrical
Appliance
Markets
Household
Capabilities
and Finances
Electricity
Supply
Appliances
transform electricity
into value for
households
Appliances cost
money to buy,
operate, and repair
Reliable electricity
enables appliances
to operate
Electricity quality problems
damage appliances
Illustrative net positive
social value creation loop
from appliance use
Illustrative net negative social value
creation loop that exacerbates
appliance costs Positive value creation contributes by
enhancing household wellbeing, income,
and capabilities through the use of
appliances powered by reliable electricity
Low quality appliances increase
household repair costs
Inefficient appliances
increase household
electricity costs
Electricity costs
money
Electricity outages disable
appliance use and disrupt
income and value creation
Appliances play a key
role in the energy-
poverty nexus.
Here we focus in just on appliances.
Electrical
Appliance
Market
HH Financial Capabilities
Electricity
Supply
-Low efficiency, vintage technology
appliances dominate appliance markets
and use
-Used or refurbished equipment is
common
-Poor quality repairs result in additional
damage and recurring repair bills
-Loss of revenue to electricity supplier from reduced household use of
electricity and household inability to grow appliance use and value
creation
-Ineffectiveness of tariff slabs in achieving intended impact
-Households experience an increased burden on their financial budget and
increased vulnerability to socio-economic shocks and stresses
-Households experience reduced financial capacity and ability to pay for
electricity service
-High costs prevent transition to high-grade, newer appliances
-The combined effects of low quality electricity supply and appliances reduces
impact of electrification on expected quality of life outcomes
-Households are limited in their ability to grow economic activities that rely on
electrical appliances
Auto-curtailment of
electricity use, Suppressed
demand
Low quality
supply
High cost of ownership,
Reduced lifetime and quality
Restrained business
opportunity
Insufficient financial
support system
-High Food & Water expenses
-Income limits
Supply Side Constraints
6. Creating Value by Energizing Public Spaces
Finally, we interviewed a variety of stakeholders in diverse public spaces
about the challenges and opportunities associated with electrification.
Spaces focused on commercial and service work (interviews were
conducted in 15 spaces), healthcare (10), training and livelihood
development (3), and recreation and entertainment (13).
6. Creating Value by Energizing Public Spaces
In each space, we inquired into five areas of interest:
•Who used the space and for what purpose?
•What benefits did the users derive from the space?
•What were the principal costs incurred by the users?
•What were the principal energy burdens experienced by the users?
•What were the principal opportunities that were lost as a result of
shortcomings in electricity services?
Freetown
6. Creating Value by Energizing Public Spaces
What User
Groups Were
Present?
What Benefits
Were Derived?
What Costs
Were
Incurred?
Direct Energy
Burdens
Lost Opportunity
due to Energy
Service
Owner / Operator /
Employee
Livelihoods and
Income
Socializing and
Networking
Procurement of
Services & Supplies
Operations
(Utility Bills)
Backup Power
Supply Costs
Passing Energy
Costs to
Customers
Insufficient Space
Cooling
Limited
Profitability and
Production Due to
Intermittent
Electricity Supply
Customers /
Patrons / Members
/ Beneficiaries
Payments for
Goods &
Services
Commercial & Service
Carpentry Shop (3)
Transportation Hub (2)
Mini Market (2)
Welding Workshop (2)
Car Wash Centre (2)
Metalworks (2)
Lorry Park
Water Packaging
Company
6.1. Creating Value in Commercial and Service Spaces
What User
Groups Were
Present?
What Benefits
Were
Derived?
What Costs
Were
Incurred?
Direct Energy
Burdens
Lost Opportunity due to
Energy Service
Healthcare
Professionals /
Staff
Employment /
Livelihood
Healthcare
Services
Socializing
and
Networking
Operations
(Utility Bills)
Standby Power
Supply Costs
Risks During
Childbirth
Limited Emergency,
Blood, and Critical
Medication Storage
Capacities.
Expansion of Treatment
and Care Capabilities
(Blood Bank, Emergency
Room, Diagnostic
Laboratory, Maternity
Care)
Patients /
Chaperones
Payments for
Services
Healthcare Facilities
Community Heath
Center (2)
Maternal & Child
Health Centre (3)
Clinics (4)
6.2. Creating Value in Healthcare Spaces
What User
Groups Were
Present?
What Benefits
Were Derived?
What Costs
Were
Incurred?
Direct Energy
Burdens
Lost Opportunity due to
Energy Service
Trainers / Staff
Employment
Skills Training
Access to
Finance
Professional
Network
Building
Operations
(Utility Bills)
Standby
Power
Supply Costs
Lower Costs for
Beneficiaries by Passing
on Savings from
Reduced Energy Costs
Students /
Entrepreneurs
Payments
for Services
Livelihood
Development
Skills Development
Center (2)
Women’s
Cooperative (1)
6.3. Creating Value in Livelihood Development Spaces
What User
Groups
Were
Present?
What
Benefits
Were
Derived?
What Costs
Were
Incurred?
Direct Energy
Burdens
Lost Opportunity due to
Energy Service
Owners and
Employees
Employment
and Local
Economic
Activity
Important
for
Recreation
and
Socializing
Operations
(Utility Bills)
Standby Power
Supply Costs
Food Spoilage
Lower Costs for Customers
by Passing on Savings from
Reduced Energy Costs
Improved Aesthetics and
Customer Experience
Safer and More Efficient
Appliances to Add to
Profitability (TV, Freezer,
Water Heater / Boiler)
Customers
Payments
for Services
Recreation &
Entertainment
Bar & Restaurant (4)
Ataya Base (9)
6.4. Creating Value in Recreation Spaces
6.5. Creating Value in Commercial and Service Spaces in B, K, S
Bo, Kenema, and Segbwema
Spaces Surveyed
Bo
Hotel/Restaurant (2)
Vocational Training Centers (3)
Kenema
Vocational Training Centers (1)
Health Center/Hospital (1)
6.5. Creating Value in Commercial and Service Spaces in B, K, S
Segbwema
Hotel/Restaurant (3)
Religious/Community Center (1)
School (2)
Hospital/Health Center (1)
Traders/Tradesmen Association (2)
Workshops(Carpentry, Agri processing) (2)
Qualitative analysis of themes and narratives
Functional capacities: Glaring need to operate existing critical devices reliably and continuously to provide uninterrupted
services. For profit businesses suffer from revenue loss or inability to profitably expand. Social services function on reduced
capacity to serve.
Value creation: Time-of-day and task-linked supply to increased reliability and make cost-benefit ratio favorable; Hot water;
Reducing operating cost and final cost of service/product.
Socio-technical arrangements:
Technology: Preference of a local generating system (solar) weighed down by concerns about upfront cost and technical skill
required to operate and maintain. Supply from a wire is less preferable but also less demanding.
Ownership: Autonomy and control over generation to operate according to demand schedule is a highly desired characteristic of
task-linked energy system.
Trust in operator: Majority of participants indicate a preference for a public utility involvement in various forms. While ‘Efficient
operations’ expectation drives a preference for private operators among some participants, almost everyone equates ‘Cost
effective/Affordable’, ‘Reliability’, ‘Continuity of supply’, ‘Tolerance and sensitivity to the customer’s situation (interpreted as
financial variability or instantaneous ability to pay risking disconnection)’ with a public utility operated system.
Financial arrangements: Almost all respondents willing to pay an upfront premium for enhanced service (including partial capex
for solar). This is accompanied by expectation of (i) co-financing and (ii) lower and/or predictable energy bills for the long term.
6.5. Creating Value in Commercial and Service Spaces in B, K, S
Thank you