Subsidized LPG Scheme and the Shift to Cleaner Household Energy Use: Evidence from a Tribal Community of Eastern India

Abstract

Traditional fuels have both environmental and health impacts. The transition from traditional to clean cooking fuel requires significant public policy actions. The Pradhan Mantri Ujjwala Yojana (PMUY) is one of the primary policies launched in India to eradicate energy poverty among households. Past studies have focused on the drivers that motivate rural households to adopt clean energy and identified the bottlenecks for adoption of clean energy in developing countries. PMUY’s success in terms of scale and pace is critical in the national drive to provide access to clean energy fuel to each citizen. The present study focuses on two objectives. First, we investigate the intensity of adoption and refill of LPG under the PMUY scheme. Second, we use household and other demographic characteristics to examine the factors that influence households’ decision on using LPG as a cooking fuel. Empirical results show that rapid growth has been witnessed in the provision of subsidized LPG connections. However, the annual average refill status stands at two LPG cylinders per beneficiary household indicating that the majority of the beneficiaries have failed to refill their LPG cylinders. This imbalance between rapid enrollment of LPG and limited refill among beneficiary households indicate the continued usage of traditional sources of energy for cooking. From the primary survey conducted in the rural tribal communities of Odisha, we observe that household income and education played a significant role in adoption of LPG and continued usage of LPG gas. Additionally, the logit and ordered probit models identify that membership in self-help groups, accessibility and awareness of LPG are the major adoption drivers. In conclusion, policy makers need to address the challenge of refill status among PMUY consumers. Further, educating households on health benefits through SHG and creating accessibility at village level can actively increase the usage of LPG.