Economic Analysis on Electrification of Rural Villages in Eastern Zambia

Abstract: A large proportion of Zambia’s population lives in rural areas and only 3 percent of them have access to electricity. This means that they have to cook over open fire that requires firewood, and with a growing population this usage will increase deforestation. The absence of proper lighting possibilities make life hard during the nights and also increase unwanted encounters with dangerous animals. The government of Zambia has began to realize that the electrification issue needs to be solved and has therefore initiated the development of a national power grid. But other alternatives are required to provide the vast majority of rural villages due to slow progress and high costs associated with the power grid. Generator powered electricity is an option but the question is whether it is sustainable or not? Jatropha Curcas is a multipurpose crop and its seeds can be used for oil extraction. This oil can then be used to produce biodiesel in a transesterification process, which can be conducted in the villages. This integrated biodiesel production lets villagers take control over their own electricity supply since they would grow it on their own land, and is a good alternative until the power grid is available. This paper deals with issues regarding what type of fuel that should be used and how to conduct a process towards electrification in order for villages in the area to be financially and environmentally sustainable. Interviews were conducted in the project village Kakoma, Lundazi District area, and used for data and information collection. In the general case, aiming at providing a general model for electrification in the area, a comparison between fossil diesel import and Jatropha based biodiesel was made, where a part of each farmer’s cultivation area is used for growing Jatropha instead of cash crops. In a case study, growing Jatropha on a new land area in order to produce biodiesel is compared with diesel import. Using a Cost-Benefit Analysis it can be shown that Jatropha based biodiesel is more financially viable in both cases. However, large investment costs that are excluded from the calculations would decrease its feasibility. To make a transition from cash crops to Jatropha possible there are certain identified socioeconomic factors that need to be fulfilled. External knowledge, villagers propensity to cooperate for the common good, woman involvement, leadership and increased education levels are important for a transition to be successful. In order for Jatropha cultivation to be sustainable, deforestation in favour for plantations cannot be allowed and also efficient use of byproducts to complete the lifecycle of the plant needs to be applied. A general case transition towards Jatropha based biodiesel is not recommended at the moment due to high risks, mainly due to short-term thinking by villagers, absence of NGOs and insufficient financial resources. The presence of an NGO in the Kakoma case, that is monitoring projects along with strong leadership make this case more likely to succeed. However, more research regarding seed yields in the area and the social dynamics of villages is required in order to make a informed decision whether a transition should be conducted or not.