Lost in transition: The decline of LPG usage and the charcoal renaissance in urban Senegal

Julian Rose, Jörg Peters, Hanna Hodel, Medoune Sall and Gunther Bensch
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Julian Rose: RWI - Leibniz Institute for Economic Research

No 6tgqs, OSF Preprints from Center for Open Science

Abstract: Claims for removing fossil fuel subsidies in the Global South are based on climate and equity concerns, but they can be at odds with improving access to Liquefied Petroleum Gas (LPG) as a clean cooking fuel. We examine the case of urban Senegal where LPG usage rates were among the highest in sub-Saharan Africa in the late 2000s. Using Demographic and Health Survey (DHS) data, we show that LPG usage declined sharply following the removal of subsidies in 2009. Counterintuitively, the decline was not reversed when falling world market prices led to a local price decrease. To explore this puzzle, we use detailed cooking data from surveys we conducted in 2009 and 2019. We find that households change to charcoal after the subsidy removal, but they increasingly use newly promoted energy-efficient charcoal stoves. These stoves make charcoal cooking cheaper and hence the switch back to LPG less attractive. Our results underscore that the energy transition of the poor is highly price responsive – an important insight not only for the debate about fossil fuel subsidies but also carbon taxation.

Date: 2024-04-08
New Economics Papers: this item is included in nep-afr, nep-dev, nep-ene and nep-env
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Working Paper: Lost in transition: The decline of LPG usage and the charcoal renaissance in urban Senegal (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:osf:osfxxx:6tgqs

DOI: 10.31219/osf.io/6tgqs

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