An analysis of household cooking fuel choice and expenditure in Ghana

Abstract

Energy is a critical input in an economy and an increased consumption of it has long been associated with an increase in economic activities and an improvement in wellbeing. Due to its multiple sources and uses in various sectors of the economy, a complex relationship between energy use and human development has evolved. One aspect of this complex relationship is the increased recognition that a wide range of energy sources used in many countries for various purposes is both unclean and inefficient, with significant environmental consequences. Using the seventh round of the Ghana Living Standard Survey (GLSS) and a survey on households in Techiman, this study assesses the factors that influence households‘ choice of cooking energy and expenditure on LPG in Ghana. The study employed the energy ladder theory to undertake the investigations. With respect to factors influencing choice of cooking energy, it was observed that education status, area of residency, household size and age of household head were all statistically significant in explaining the adoption of wood, charcoal and electricity in cooking as opposed to LPG by households. Based on the results obtained from a multinomial logistic model, the study confirmed the validity of the energy ladder theory for Ghana. Thus, an increase in household income was found to decrease the adoption of traditional fuels and increase the adoption of modern fuels for cooking. This implies that, lower income household heads are more likely to opt for wood and charcoal as cooking fuel rather than LPG, which was predominantly used by high-income earners. Finally, the study used the double hurdle model to explore factors that influence participation and expenditure decisions in the LPG market by households in the Techiman municipality. The study revealed that area of residence, income, sector of employment, sensitization, affordability,reliability, accessibility and tertiary education significantly affected household LPG usage, education level (basic & secondary), house ownership and marital status did not have significant impact on LPG usage. The study then recommended enhanced income creating opportunities and LPG use educational programmes among others to improve the use of LPG by households