Welfare impacts of an entry-level solar home system in Uganda

Abstract

ABSTRACTHome solar systems have the promise of bringing great welfare benefits to poor households without access to the electricity grid. We study the welfare impacts brought by the purchase of a popular home solar system in Uganda, d.light’s D20g, and estimate impacts using prospective individual-level matching. We find substantial impacts on energy spending, with treatment households saving approximately 1.40 USD/week, which corresponds to 77 per cent of the comparison group’s weekly energy expenditure. Assuming this savings stays constant, households will break even on their initial purchase after 3.14 years, and accrue net energy savings of 134 USD over the 5-year expected lifetime of the D20g. We also find improved self-reported health and safety outcomes, as treatment households reported fewer lower incidence of coughing (9 percentage points). They also report a nearly complete elimination of fires and burns from lighting sources, compared to around 10 per cent of households reporting such incidents in the comparison group. We do not find impact on productive time use such as studying or working.