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Lighting the lights for livelihood: accessing solar energy in India under capability framework approach

Student name: Mr Abhinav Srivastava
Guide: Dr Ritu Mathur and Dr Gopal Sarangi
Year of completion: 2016
Host Organisation: TERI University

Abstract: Solar lights can act as a feasible alternative to the existing kerosene or other conventional sources of lighting, which have significant negative effect on human health, or externalities. The up-front capital required for kerosene lighting is very little in comparison to the solar lights, however low and inefficient lighting accompanied by smoke, dust and high kerosene prices impose significant real costs. The recent advances are being made to transfer all the Central Government subsidies (including the one on Kerosene) into the bank account of the beneficiary, such increase in nominal income can potentially incentivize investments in Solar Lamps. The monetary remittance received instead of subsidized kerosene (in-kind) in the beneficiary's bank account could be used as a potential source of loan installments for financing solar lamps. This also bridges the Solar Lamp’s high upfront capital barrier. A successful rollout of financing solar lamps at the initial stage would strengthen the individual's information base regarding the positive benefits associated with solar energy. This in turn would build encouragements for financing higher modules such as Solar Household Systems (SHS). It would also build community confidence and reduce ‘trust deficit’ towards community owned solar mini-grids.

The study adopts ‘Capability framework’ from Welfare economics as a tool in analyzing these research findings. The study within its capability framework approach, further tries to understand the benefits obtained from Cash transfer programs under its different parameters like making more people bankable, green lending, knowledge enhancement etc,.

The study tries to find insight on how to make the effective use of the energy subsidies in the better functioning of the resources. It uses the cash transfer approach in this assessment. The study further tries to understand how does the possession of a solar appliance (clean and green product) influence individual’s well-being and enhance their capabilities.