Determinants and welfare impacts of rural electrification in Ghana

Abstract

Abstract Electricity is considered one of the basic attributes of modern life. This study examines why some rural households and communities remain without power despite Ghana’s progress in rural electrification. The objectives are to analyze the role of socio-economic factors in household electrification and to also examine the welfare impacts of one of Ghana’s flagship rural electrification programs. Using the most recent two household datasets constructed from two nationwide household surveys (GLSS VI and GLSS VII samples) combined with other community datasets, the following results were obtained. First, household expenditure, employment status, and gender of the head of the household are significant predictors of rural household electrification in Ghana. Second, these robust predictors tend to persist over the two sample periods. Third, using one of Ghana’s flagship rural electrification programs called the Self-Help Electrification Programme (SHEP) as a proxy for public policy, the results indicate that SHEP correlates with improvements in electrification rates of rural communities. Lastly, although rural electrification improves community welfare, its impact is skewed towards rural communities with higher average household expenditure.