The role of remittances in clean energy adoption: New household level insights from West Africa

Abstract

Alleviating energy poverty is one of the United Nations’ Sustainable Development Goals (SDG7). In the context of sub-Saharan Africa, where most households continue to rely on traditional fuels such as wood, charcoal, dung, crop residues, and coal, for their primary cooking needs, this goal is of great importance. This study examines the cooking energy consumption patterns of recipients of foreign and domestic remittances in West Africa. Econometrically, we use large data sets and comprehensive identification strategies. We find that remittance-receiving households are more likely to use LPG cooking technology. However, this positive effect is only significant for rural households. An examination of the potential mechanisms through which remittances operate suggests that rural remittance-receiving households are more likely to be financially included and more likely to engage in non-farm activities. In terms of public policy, our findings suggest that remittances should be taken into account when designing policies to promote the transition to clean energy in rural areas.