While it is generally accepted that access to
power yields positive social and economic
impact, there is little concrete evidence.
Kenya’s vast rural landscape tells a misleading story about energy access across the country. Power transmission towers can be spotted in even the most remote areas and found within one kilometer of 70 percent of Kenyan households. Yet only five percent of rural
residents—who constitute the majority of Kenya’s 44 million
people—have electricity. This is likely because the cost of a
household power connection is prohibitively high for most
rural families: about US$400 per home. As a result, most
village homes go dark once the sun goes down.
Alleviation of so-called “energy poverty” is a key focus in
the field of international development. But while it is generally accepted that access to power yields positive social and
economic results, concrete evidence is sparse.
“We actually know very little about the impacts of energy
access, and whether there are in fact large welfare gains
from these versus other types of community investments,”
says Ken Lee, a graduate researcher with the University of
California, Berkeley’s Center for Effective Global Action (CEGA).
Few studies have sought to examine the relationship between infrastructure development and social and
economic wellbeing. This is surprising, given the enormous public and private investment in infrastructure. For
example, in 2014, the World Bank spent $24.2 billion on
infrastructure, which typically accounts for 30 to 40 percent
of its total commitments.
For the last three years, a team of researchers from
Berkeley’s Development Impact Lab have been working
to shed light on that question. The Lab, which is funded
by USAID, develops multidisciplinary projects to improve
development impact. Its team in Kenya, which includes Lee,
has partnered with a Kenyan government agency on a large
randomized study to determine the costs and benefits of
expanding energy services to remote areas.
“We hope to show, with rigorous impact evaluation,
whether there are quantifiable positive effects of connect-
ing people to the electricity grid,” explains Matt Podolsky,
an engineer who serves as a technical expert on the project
from Berkeley’s Technology and Infrastructure for Emerging
Regions ( TIER) group. “It’s not necessarily a unique idea, but
having this kind of evidence would be useful for influencing
It may not be a new idea, but it is a relatively untested
one: Berkeley’s so-called “Rural Electric Power Project” in
Kenya is one of a very small number of randomized studies
on infrastructure development.
Randomized controlled trials—commonly called RCTs—
set the gold standard for empirical analysis because of
their rigor and objectivity. But while they have become the
norm in fields like drug and medical device testing, experts
acknowledge that it is difficult to execute RCTs for infra-
structure because of the difficulty identifying counterfactu-
als. In the scope of electricity projects, this means trying to
estimate how households with electricity would have fared
if they did not have electricity.
“One way to deal with this counterfactual is to make
electricity available in a randomized fashion and then
observe how households similar in all characteristics
except electricity compare with one another,” notes a 2009
World Bank study on rural electrification in Bangladesh.
This is not how grid expansion projects are typically
planned, however. “In order to be financially viable,
electricity [projects] generally follow a plan to reach more
developed and densely populated communities before
more remote areas,” the report explains. This highlights
why in Kenya, for example, urban electrification (65
percent) far outpaces rural electrification ( 5 percent), even
when a larger share of the population lives in rural areas.
Other experts note that there are also ethical considerations to randomly assigning infrastructure access to
members within the same community.
The approach the REPP team is testing effectively allows
for electricity connectivity to be randomized, while avoiding
potential allegations of unfairness or favoritism. This is
because the study merely encourages access by offering
some households a discount for a power line connection.
The REPP team selected 150 villages in western
Kenya that are within a mile ( 1. 6 km) of a power transformer. In half of those villages, about 1,100 households
were offered the discount; the other villages were
not. Hundreds of the “treatment group” households
responded to the incentive.
At the time of writing, the REPP team had begun analyzing information about the households that responded
to the voucher. Over the next year, they will also review
household energy usage and social and economic
impacts between the study’s connected and unconnected households.