Urban household energy use in Tanzania: Prices, substitutes and poverty

Abstract

This paper presents the findings of the Tanzanian Urban Household Energy Survey undertaken as part of the Tanzania Urban Energy Project. Household energy use varies by income group according to local fuel availability. Considerable differences between the marginal costs of supplying fuels and market prices paid by consumers have led to major misallocations of resources. When the results of this survey are compared to the results of the 1987 household energy survey, a significant shift by households toward kerosene and electricity away from fuelwood, charcoal and LPG is shown to have taken place. These shifts toward modern fuels are consistent with the claims of the households in the 1990 survey, and can largely be explained by fuel prices. Finally, an assessment of the lifeline tariff and the kerosene cross-subsidy demonstrate that the latter is a more effective method of ensuring the basic energy needs of the urban and rural poor.