AFREPREN/FWD Summary of the UPEA II Research Findings By Stephen Karekezi, John Kimani and Oscar Onguru

Background to the Study –The urban poor population is increasing as the agricultural sector (the main source of employment and livelihood for majority of the rural population), can not meet the employment and aspirational needs of a young and growing population.

Study Objectives, Methodology and Scope of Study The principal objectives of this study included the following: Assessing modern energy services available to the urban poor Identifying the cost of energy services Identifying subsidies offered and policies for promoting energy access among the urban poor The study was a combination of both desk research and primary data collection The scope of the study was to provide a brief assessment of key urban and peri urban energy access issues in Kenya.

Reasons for Choice of Location and Study Challenges Kibera was an ideal location for the study for the following reasons: Being the largest slum where the urban poor live, findings would be, in many respects, indicative of the situation among the urban poor. Kibera is within very close proximity to the AFREPREN/FWD offices. The key challenges that were faced in the course of the study were as follows: The size of survey respondents was relatively small The time and financial resources allocated for this study were not sufficient to sample a much wider population There have been very few energy studies that have been carried out on Kibera, therefore secondary data and information sources were unavailable for crosschecking the data collated for consistency and accuracy. Respondent fatigue: From surveys in other sectors i.e. water, education, HIV/AIDS etc Kibera is a high security risk area

Study Findings The survey identified four energy options for assessment, namely: Biomass energy, kerosene, liquefied petroleum gas (LPG) and electricity. Reasons for selecting the aforementioned energy options for further analysis: –The requisite infrastructure for the promotion and use of these energy option is already is already in place –The energy options have the potential for meeting the energy needs of the urban poor.

Study Findings Most Common Energy Source Used for Lighting (Household)

Study Findings Most Common Energy Source Used for Cooking

Findings on SME’s Most Common Energy Source Used

Survey Conclusions The household survey findings clearly demonstrate the role that kerosene, electricity, biomass and LPG can play for cooking and lighting in Kibera. According to the survey findings (see the following figure), kerosene is the most important modern energy option for the poor both for lighting and cooking. Electricity also appears to be a relatively important energy option for lighting. Biomass in form of charcoal as well as LPG appear to be consumed by a relatively small segment of the urban poor in Kibera.

Comparison of Survey Findings to National Energy Consumption The results of this survey largely reflect the situation at the national level (see the figure below). –National survey conducted in 2002 by the Ministry of Energy revealed that kerosene is, in overall terms, the most commonly used fuel –The Ministry of Energy’s survey also found LPG as the least commonly used fuel –Some major differences between the findings of this study and the situation at the national level. These differences largely arise from the variance in energy consumption patterns between rural and urban households And the extent of development of energy supply chains in rural and urban areas

Survey Conclusions Overall Energy Use in Kenya

Study Recommendations Past pro-poor incentive strategies have been exclusively focused on the kerosene fuel. While tax reduction in kerosene has resulted in motor fuel adulteration, it is believed that if similar incentives were targeted on kerosene appliances, the benefits to the poor would be higher and would minimize possibility of any diversion to unintended uses Taxes are a key determinant of the retail price of both kerosene and its related technologies, mainly stoves. Key taxes include import duty, excise duty, value added tax and the petroleum development levy A review of the lifeline tariff is required in order to better target the subsidy to reach the poor so as to enhance electricity access among the urban poor. –An option would be to use the resources currently directed to electricity subsidies to lower the upfront cost of connection for the urban poor.

Study Recommendations Biomass (charcoal) plays an important part in the lives of the urban poor, issues affecting its access and dissemination and use i.e. the ban on logging and production of charcoal in traditional low efficient earth kilns should be addressed so that it can be produced, promoted and distributed in a sustainable and efficient manner, within the formal economy Promotion of more sustainable biomass (charcoal) use should be pursued in tandem with use of improved charcoal production and improved cookstoves in order to keep its demand in check. In addition, in light of some of the safety issues posed by charcoal, as well as forestry conservation concerns, there is need for promotion of other forms of sustainable biomass options such as ethanol gel. Innovative financing mechanism or subsidies targeting the poor, should be created and targeted directly to the poor, to enable them purchase LPG cylinders and its related accessories. Establishment of a penalty system, where LPG suppliers are compelled to pay a hefty fine for any cylinder found to be underweight as well as failure to adopt common cylinder regulators/valves.