Blum, Nicola Ursina (2013). Fostering rural electrification : The case of renewable energy-based village grids in South East Asia (Dissertation, ETH Zürich, Department of Management, Technology, and Economics)
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Providing the rural poor with access to modern energy services is a major challenge in developing countries striving for economic growth, social development and environmental integrity. Socially, developing countries suffer from higher poverty levels accompanied by greater inequality, faster- growing populations, more unsolved health issues and lower educational levels than developed countries. Economically, they struggle with a largely untrained workforce and a lack of public and private financial resources. Environmentally, developing countries have to juggle new industrial development with environmental precaution. A major environmental threat is climate change. Developing countries are often disproportionately affected by it, which poses challenges in terms of adaptation and mitigation. In an attempt to address these challenges in a concerted international effort, the United Nations defined the Millennium Development Goals (MDGs) in 2001. Currently the follow-up goals, the so called Sustainable Development Goals (SDGs), are under discussion. An important lever to address the MDGs and SDGs is the provision of (renewable energy-based) electricity to a wider population. As of today, more than 1 billion people worldwide still lack access to electricity. Most of them are poor and live in rural areas in Africa and Asia. Access to electricity is a prerequisite for industrial progress and an increased standard of living for these people. Additionally, if the electricity is produced by means of renewable energies, it contributes to the reduction of CO2 emissions, which is a global concern in the context of mitigating climate change. Compared to the alternative rural electrification approaches (e.g., solar lanterns, stand-alone systems, diesel-based village grids and grid extension), renewable energy based village grids (RVGs) are - in light of the MDGs and SGDs - the most appropriate solution to provide rural poor with access to electricity. RVGs are decentralized electricity systems which power a rural village with electricity produced by renewable energy technologies. They are environmentally-friendly and allow for social infrastructure and productive use of electricity, in addition to electricity for household purposes. Despite the advantages of RVGs as a rural electrification approach, large-scale diffusion of RVGs has not yet taken place. So far literature has not provided sufficient and diversified insights on the reasons for the low diffusion rates. In this thesis I address this gap by considering the question: “why is the diffusion of RVGs in developing countries low and how can it be advanced?” for the case of Indonesia and Laos. The target of the thesis is to provide insights for practitioners such as investors, development specialists, and policy makers, as well as to improve existing theory and empirical data on the diffusion of (renewable energy) technology. The question is tackled from three complementary perspectives: a techno-economic, investor’s, and innovation systems perspective. While the techno-economic literature examines how diffusion of technology depends on relative prices, in the investor’s perspective, individual firms are regarded as the central drivers of diffusion. Innovation systems literature, alternatively, understands diffusion as an iv evolutionary process, where different actors are involved and decisions depend on additional variables apart from relative prices. These different perspectives complement each other and allow for practical (investor and policy) implications. This dissertation makes three scientific contributions. First, as suggested by different scholars, the thesis applies different concepts and methods. The different concepts are reflected in the three applied perspectives. Depending on the perspective, I employ quantitative or qualitative methods. The second contribution is in terms of new, empirical data. New data on costs of RVGs and villager’s willingness- to-pay in Indonesia is gained. National and international revenue sources for owners of RVGs in Indonesia are introduced and quantified. Additionally, it is the first research effort that models a village’s electricity demand and the needed supply on an hourly base. The third contribution lies in enriching the Technological Innovation System and functions framework theoretically by applying the framework to a new, “extreme” case which significantly differs from analyzed cases. The thesis thereby contributes to the ongoing debates on the set and definition of functions, the functions’ role in the system, the role of institutions, the role of geographical aspects, and the derivation of policy recommendations from a TIS and functions analysis. From the combined insights of the four papers presented in this dissertation follows; first, the techno- economic argument – that RVGs do not diffuse because they are more expensive than alternative solutions – does not hold true. Second, by combining this insight with the contributions from the investor’s and innovation systems perspective, I find that a major reason for the low diffusion of RVGs is their high complexity in technological and non-technological terms. For investors, development specialists and policy makers, this implies that managing this complexity is key to advancing the diffusion of RVGs. Investors, for example, can take measures such as managing stakeholders and their cultural diversity actively in order to reduce complexity. However, while some challenges can be addressed by the investors, in other areas policy intervention is required. For example, policy makers can consider a removal or redistribution of fuel and electricity subsidies, define and implement a stringent rural electrification strategy, fulfill a connector and translator role between their rural population and international actors and institutions, and invest in the country’s educational system. The thesis then concludes with proposals for future research
Item Type: |
Doctoral Thesis (Dissertation) |
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Division/Institute: |
Business School > Institute for Sustainable Business Business School > Institute for Sustainable Business > Social Innovation Business School |
Name: |
Blum, Nicola Ursina |
Subjects: |
G Geography. Anthropology. Recreation > GE Environmental Sciences H Social Sciences > H Social Sciences (General) T Technology > TK Electrical engineering. Electronics Nuclear engineering |
Publisher: |
ETH Zurich |
Language: |
English |
Submitter: |
Prof. Dr. Nicola Ursina Blum |
Date Deposited: |
29 May 2024 12:20 |
Last Modified: |
29 May 2024 12:21 |
Related URLs: |
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ARBOR DOI: |
10.24451/arbor.21773 |
URI: |
https://arbor.bfh.ch/id/eprint/21773 |
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