- Email: [email protected]
Real incomes and the consumption of woodfuels in Ghana
Real incomes and the consumption of -woodfuels in Ghana An analysis of recent trends
Edward M. Abakah
As in most developing countries, woodfuels account for a major share of the energy consumption in Ghana. The overdependence on woodfuels has grave -- potential environmental and health hazards, so eflorts are being made to popularize ef3i’cientenergy devices, namely cookstoves. The paper establishes the linkage between the quantity of woodfuels consumed, and the level of real incomes and intation respectively in the country using time series data from 1974 to 1987. A regression analysis indicates that the quantity of woodfuels consumed in the country is negatively and positively correlated to real incomes and inflation levels respectively. It is therefore concluded that the impact of real incomes and inflation and the continued overdependence on woodfuels should not be discounted. In light of this, eflorts to introduce andpopularize the utilizationof efficient energy devices in the country ought to be facilitated by increases in real incomes, inflation control measures and improvement in the standard of living of the populace. Keywords: Woodfuels; Real incomes; Consumption
importance of woodfuels in accounting for the major energy requirements in developing countries especially in the rural communities has been well documented. The Food and Agriculture Organisation in 1982 estimated that nearly two million tonnes of woodfuels are consumed d.aily in developing countries, about one kilogram each day for every man, woman and child [3]. In Ghana, the situation is no different: indigenous woodfuel resources continue to account for most of the energy consumed in the country. In 1987, woodfuels were estimated to have accounted for nearly 80% of the total energy consumed in the country. Petroleum products and electricity made up 14% and 7% respectively of the total energy consumed in the country in the same year [4]. Continued supply and overdependence on woodfuels have created grave conditions such as:
degradation of soils; worsening atmospheric pollution from inefficient production and use of woodfuels; increasing difficulty in harnessing woodfuel resourcesin some localities, especially in the northern sectors of the country; and escalating prices of woodfuels in areas where the demand for woodfuels exceeded its supply.
The
l
These problems arose in spite of the fact that woodfuels are technically, renewable energy resources. In most rural areas, woodfuels are obtained free of charge, as by-products from land clearing or directly from the forest. The rate at which woodfuel resources are depleted outstrips the rate at which they are replenished, especially through replanting. The FAO [3] estimated that 11.3 million hectares of woodfuel resources in the world are being lost annually to agriculture, grazing, commercial timbering, uncontrolled burning, consumption and other factors, with 90% of the cleared land never replanted. The overdependence on woodfuels could be ascribed to factors such as increasing population, increasing pressure on the forest and grassland, low efficiencies of energy end-use devices, poor conservation methods,
a rapidly deteriorating environment and ecological damage as evidenced by worsening deforestation and desertification;
The author is with the Technology Transfer Centre, Council for Scientific and Industrial Research, Accra, Ghana. Final manuscript received 17 October 1989.
0140-9883/90/03022745
0
1990 Butterworth-Heinemann
Ltd
227
Real incomes and the consumption of woodfuels in Ghana: E. M. Abakah 6 r
Figure 1.
Quantity of woodfuel consumed (toe x 106).
and inherent traditional practices of the populace. Recent trends in the quantity of woodfuels consumed in the country show a strong relationship with real minimum wages (a proxy for real incomes) and the national consumer price index (a proxy for the level of inflation). Such relationships suggest that the impact of real incomes and the level of inflation on the consumption of woodfuels should not be underestimated. This paper seeks to establish the linkage between the country’s woodfuel consumption and real incomes and the level of inflation. The conceptual analysis of the paper is framed around the following working hypothesis - the quantity of woodfuels consumed in the country is negatively and positively correlated to real incomes and inflation levels respectively. It attempts to show that measures which seek to reduce the overdependence on woodfuels must be supported by increases in real incomes and inflation control measures.
Woodfuels are consumed in the form of firewood and charcoal. The domestic sector accounts for an overwhelming proportion of the consumption of woodfuels. Food hawkers, local restaurants, ‘chopbars’, small-scale industrialists, pito brewers,’ traditional soap makers, palm-oil extractors etc, also consume a considerable amount of woodfuels. One domestic activity which consumes a large proportion of woodfuels is cooking. Cooking is the primary energy consuming activity in most developing countries like Ghana, in both rural and urban areas. In the rural areas, firewood is used mostly for cooking on the traditional 3-point cookstove which is characterized by a low energy efficiency. Some cooking also takes place on metal charcoal cookstoves popularly known as ‘coalpots’. Other uses to which woodfuels are put include water heating, fish smoking, baking, gold refinery, brick industry and tobacco curing.
Woodfuels consumption pattern
Recent trends in woodfuels consumption, real incomes and the level of inflation
A study of the woodfuels situation in Ghana is complicated by the difficulty of its precise quantification. This is due to the impossibility of measuring the volume and weight ofwoodfuels harvested by scattered families and local entrepreneurs all over the country. Moreover, woodfuels come in sticks of varying size, shape, length, split logs, fragments, forest litter, etc. Primary energy balances constructed by the National Energy Board depict the trend in the quantity of woodfuels consumed in the country from 1974 to 1987, as illustrated in Figure 1. There have been steady increases in woodfuels consumed in the country: from 4.208 million toe in 1974 to 5.848 million toe in 1987.
228
Trends in the quantity of woodfuels consumed in the country, real minimum wage (a proxy for real income), and the national consumer price index with 1977 as base year (a proxy for the level of the inflation) within the period covering 1974 to 1987 have been presented in Table 1. The quantity of woodfuels consumed in the country has been increasing steadily since 1974 as evident in Figure 1. Table 1 shows that in 1987, woodfuels consumed in the country stood at 5.848 million toe. ‘Pito is a local alcoholic
beverage
brewed from millet.
ENERGY ECONOMICS
July 1990
Real incomes and the consumption
Table 1. Ghana -quantity
of woodfuels consumed, real minimum wage and national consumer price index (CPI). Quantity of woodfuds coosumed
(toe x 1W) 4.208 4.327 4.45 1 4.570 4.697 4.820 4.950 5.079 5.212 5.349 5.458 5.573 5.709 5.848
1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987
Sources: NEB. Primary Energy Balances October 1987; Statistical Financial Statistics Yearbook 198%. Nofe:
Real minimum
wage was obtained
by deflating
nominal
2.
minimum
Figures 2 and 3 depict trends in real minimum wage and the CPI from 1974 to 1987. Real minimum wages declined from 220.26 cedis per month in 1974 to only 37.43 cedis per month in 1979. It, however, increased to 74.78 cedis per month in the following year, 1980. From 1980 to 1983, real minimum wages further declined to 22.94 cedis per month. In 1987, it stood at 42.51 cedis per month. The CPI, as illustrated in Figure 3, shows that inflation levels have been rising steeply. In 1987, 63.52 cedis were needed to purchase the same bundle of goods that only one cedi did in 1977. A regression analysis of the quantity of woodfuels consumed on the CPI and real minimum wage from 1974 to 1987 produced the following relation with a correlation coefficient (R2) value of 95.8%:
July 1990
1974-87. National consumer
wage (&is per month) 220.26 168.92 108.23 100.00 57.70 37.43 74.78 34.53 28.24 22.94 22.46 47.98 49.53 42.51
price index 1977= 100 22.70 29.60 46.20 100.00 173.30 267.20 401.20 868.70 1062.40 2367.40 3304.20 3647.20 4543.10 6352.00
Service, Quor~er!,. Digest of Statistics, several issues; and IMF Intemationa/
Real minimum wage (cedis per month).
ENERGY ECONOMICS
in Ghana: E. M. Ahakah
Real minimum
wage by CPI.
1975 Figure
ofwoodfuels
1977
Figure 3. Consumer
Wi=5011+0.18
1979
1981
1983
1985
1987
price index (1970 = 100).
Ci-3.96 Ri
(1)
where Wi= quantity of woodfuels consumed in the country in million toe, 1974-87 C’i=consumer price index (CPI), with 1977= 100 Ri= real minimum wage in cedis per month. Equation (1) establishes that: l
The quantity of woodfuels consumed is positively correlated to the CPI. An increase of 0.18% in the CPI will increase the consumption of woodfuels by
l
The quantity of woodfuels consumed is negatively correlated to the real minimum wage in the country.
1%, ceteris paribus.
229
Real incomes and the consumption of nsoodfuels in Ghana: E. M. Abakah 607
50-
Ef;a
Charcoal
m
Ftrewood
Figure 4. Firewood and charcoal prices in selected towns, April-October
An increase of 4% in real minimum wage will decrease the quantity of woodfuels consumed by 1%, ceteris paribus.
Equation (1) also establishes the validity of the working hypothesis postulated at the beginning of the paper.
Discussion and implications The problem of overdependence on woodfuels and its implications is not new to Ghana. The NEB and other institutions have initiated impressive work programmes and projects which aim at redressing the problem. Current on-going projects include: l
l
l
l
the introduction of improved woodfuel burning devices - improved charcoal stoves, sawdust stoves etc, improved charcoal production - demonstration and introduction of efficient charcoal production technologies, introduction and popularization of other energy resources like biogas, LPG etc; and reforestation and community forestry programmes.
In their paper on energy use in some selected cities of developing countries, Sathaye and Meyers [7] found that the kinds of devices used in the home to accomplish energy-requiring activities are determined by the economic resources accessible to households and the general availability of different fuels and energy-using devices. Writing about energy use in Hong Kong, Newcombe [6] concluded that the move from traditional fuels (including woodfuels) and devices to kerosene, gas, or electricity depends on household income.
230
1989.
Compiling data on cooking fuels used in urban households in selected Third World citites in Asia, Sathaye and Meyers [7] outlined the following pattern: ‘A rise in the use of kerosene with income within the lower income groups as income increases further, kerosene gives way to LPG and/or electricity’. In his paper on village woodlot, Turkson [8] noted that purely technical solutions to the rural energy problem might be too simplistic. The writer argues that rural dwellers must have reasonably good incomes to invest in improved energy-saving or energy efficient technologies. Analysis carried out in this paper using data on the quantity of woodfuels consumed, real minimum wages and the consumer price index reechoes the crux of the matter - real incomes and the level of inflation influence the consumption of woodfuels in the country. A recent baseline study carried out by the NEB on the charcoal cycle in Ghana in 19 selected cities exposed high retail prices for woodfuels. This is illustrated in Figure 4. Terna’ recorded the highest average prices per kilogramme of firewood and charcoal within the period covering April to Otober 1988. These were 10.21 and 42.75 cedis respectively. Prominent among the reasons for the high cost of woodfuels as advanced by the study were high transport costs, large number of middlemen etc. A woodfuel survey in Hyderabad, India in 1983 provided a quantitative estimate of changes in woodfuel usage patterns with income [l]. Firewood turned out to be an ‘inferior’ good - its consumption fell as income rose. A 10% increase in income was associated with an 8% decline in firewood consumption. Similarly, this *Terna is a port city in Ghana.
ENERGY
ECONOMICS
July 1990
Real incomes and the consumption ofwoodfiels in Ghana: E. M. Ahakah
paper postulates that ceteris paribus, a 4% increase in real minimum wages will decrease the quantity of woodfuel consumed by 1% or a saving of 58.48 thousand toe of woodfuels, using the 1987 figures as in Table 1. A woodfuel marketing survey carried out in Accra, 11-23 July 1988, as part of the NEB baseline study on the charcoal cycle found that charcoal seemed to be regarded as a ‘dirty commodity’ in the capital city of the country [5]. It could be deduced that with increased incomes and better standards of living most of the low-income urban dwellers (major consumers of woodfuels) will shift to more ‘decent’ sources of fuel supply like LPG, biogas, kerosene etc. The popularization of energy-efficient devices could be enhanced by a possible success of the current gas prospecting activities in the country which could render a less expensive source of energy. This will minimize the current undesirable environmental and health impacts of the less efficient energy devices presently in use in the country. However, as the analysis carried out in this paper and other cited studies have shown, woodfuels consumption is strongly linked to the level of real income and inflationary trends. This, no doubt, has a bearing on the standard of living of the entire population. Given that efficient energysaving devices - gas stoves, improved kerosene stoves, solar devices etc - are fairly expensive, efforts to introduce and popularize their use must incorporate the facilitatory role of increased real incomes or improved standard of living. Cheaper but efficient energy devices could alternatively be developed, but without an improvement in their standard of living and real incomes, the populace will opt for woodfuels as the analysis in this paper and studies in other developing countries have shown.
Conclusion Grave implications of the overdependence on woodfuels in the country have given much cause for alarm. To redress this undesirable situation, efforts are being made to harmonize current woodfuels consumption with existing resources. As part of these efforts other renewable energy resources are being introduced and energy conservation practices are being encouraged. Current trends in the quantity of woodfuels con-
ENERGY
ECONOMICS
July 1990
sumed show a strong linkage with real minimum wage (a proxy for real income) and the national CPI (a proxy for the level of inflation). The quantity of woodfuels consumed is negatively and positively correlated to real incomes and inflation levels respectively. This linkage is also evident in studies carried out in other developing countries. There is also a linkage between the utilization of efficient energy devices and the level of income of the users. To this end, efforts to introduce and popularize the utilization of efficient energy devices could be greatly facilitated by appropriate increases in real incomes. an improvement in the living conditions of the populace and adequate inflation control measures. Further studies should aim at establishing the minimum income level that will induce the populace to patronize the utilization of efficient energy devices. It will be more illuminating to conduct a nationwide survey to collect data on the level of income of users and the kind of energy devices utilized in the home.
References M. Alam, J. Dunkerley, K. Gopi and W. Ramsay, ‘Fuelwood survey of Hyderabad’, Resources for the Future, Washington, DC, 1983. M. R. De Montalembert and J. Clement, Fuelwood Supphes in the Developing Countries, FAO, Rome, 1983. Food and Agriculture Organisation, Tropical Forest Resources: Forestry Paper No 30, Rome, 1982. Ministry of Fuel and Power, Energy and Ghana’s Socioeconomic Development, brief prepared for the PNDC government, Ghana, September 1988. National Energy Board/United Nations Development Programme, The Charcoal Cycle in Ghana - A Baseline Srudy Technical Supplement, Consolidated Report On the Marketing of Woodfuels in Major Centres in Ghana, November 1988. K. Newcombe ‘Energy use in Hong Kong: Part IV: Socioeconomic distribution, patterns of personal energy use, and the energy slave syndrome’, Urban Ecology, Vo14, 1979, pp 179-205. J. Sathaye and S. Meyers, ‘Energy use in cities of developing countries’, Annual Review of Energy, Vol 10, 1985, pp 109-133. J. K. Turskon, ‘Village woodlot: are they solutions to rural energy problems?’ Energy Research Group Newsletter, Vol 10, University of Science and Technology, Kumasi, Ghana, December 1988, pp 27-33. T. S. Wood and S. Baldwin, ‘Fuelwood and charcoal use in developing countries’, Annual Review of Energy, Vol 10, 1985, ~~407-429.
231
Edward M. Abakah
As in most developing countries, woodfuels account for a major share of the energy consumption in Ghana. The overdependence on woodfuels has grave -- potential environmental and health hazards, so eflorts are being made to popularize ef3i’cientenergy devices, namely cookstoves. The paper establishes the linkage between the quantity of woodfuels consumed, and the level of real incomes and intation respectively in the country using time series data from 1974 to 1987. A regression analysis indicates that the quantity of woodfuels consumed in the country is negatively and positively correlated to real incomes and inflation levels respectively. It is therefore concluded that the impact of real incomes and inflation and the continued overdependence on woodfuels should not be discounted. In light of this, eflorts to introduce andpopularize the utilizationof efficient energy devices in the country ought to be facilitated by increases in real incomes, inflation control measures and improvement in the standard of living of the populace. Keywords: Woodfuels; Real incomes; Consumption
importance of woodfuels in accounting for the major energy requirements in developing countries especially in the rural communities has been well documented. The Food and Agriculture Organisation in 1982 estimated that nearly two million tonnes of woodfuels are consumed d.aily in developing countries, about one kilogram each day for every man, woman and child [3]. In Ghana, the situation is no different: indigenous woodfuel resources continue to account for most of the energy consumed in the country. In 1987, woodfuels were estimated to have accounted for nearly 80% of the total energy consumed in the country. Petroleum products and electricity made up 14% and 7% respectively of the total energy consumed in the country in the same year [4]. Continued supply and overdependence on woodfuels have created grave conditions such as:
degradation of soils; worsening atmospheric pollution from inefficient production and use of woodfuels; increasing difficulty in harnessing woodfuel resourcesin some localities, especially in the northern sectors of the country; and escalating prices of woodfuels in areas where the demand for woodfuels exceeded its supply.
The
l
These problems arose in spite of the fact that woodfuels are technically, renewable energy resources. In most rural areas, woodfuels are obtained free of charge, as by-products from land clearing or directly from the forest. The rate at which woodfuel resources are depleted outstrips the rate at which they are replenished, especially through replanting. The FAO [3] estimated that 11.3 million hectares of woodfuel resources in the world are being lost annually to agriculture, grazing, commercial timbering, uncontrolled burning, consumption and other factors, with 90% of the cleared land never replanted. The overdependence on woodfuels could be ascribed to factors such as increasing population, increasing pressure on the forest and grassland, low efficiencies of energy end-use devices, poor conservation methods,
a rapidly deteriorating environment and ecological damage as evidenced by worsening deforestation and desertification;
The author is with the Technology Transfer Centre, Council for Scientific and Industrial Research, Accra, Ghana. Final manuscript received 17 October 1989.
0140-9883/90/03022745
0
1990 Butterworth-Heinemann
Ltd
227
Real incomes and the consumption of woodfuels in Ghana: E. M. Abakah 6 r
Figure 1.
Quantity of woodfuel consumed (toe x 106).
and inherent traditional practices of the populace. Recent trends in the quantity of woodfuels consumed in the country show a strong relationship with real minimum wages (a proxy for real incomes) and the national consumer price index (a proxy for the level of inflation). Such relationships suggest that the impact of real incomes and the level of inflation on the consumption of woodfuels should not be underestimated. This paper seeks to establish the linkage between the country’s woodfuel consumption and real incomes and the level of inflation. The conceptual analysis of the paper is framed around the following working hypothesis - the quantity of woodfuels consumed in the country is negatively and positively correlated to real incomes and inflation levels respectively. It attempts to show that measures which seek to reduce the overdependence on woodfuels must be supported by increases in real incomes and inflation control measures.
Woodfuels are consumed in the form of firewood and charcoal. The domestic sector accounts for an overwhelming proportion of the consumption of woodfuels. Food hawkers, local restaurants, ‘chopbars’, small-scale industrialists, pito brewers,’ traditional soap makers, palm-oil extractors etc, also consume a considerable amount of woodfuels. One domestic activity which consumes a large proportion of woodfuels is cooking. Cooking is the primary energy consuming activity in most developing countries like Ghana, in both rural and urban areas. In the rural areas, firewood is used mostly for cooking on the traditional 3-point cookstove which is characterized by a low energy efficiency. Some cooking also takes place on metal charcoal cookstoves popularly known as ‘coalpots’. Other uses to which woodfuels are put include water heating, fish smoking, baking, gold refinery, brick industry and tobacco curing.
Woodfuels consumption pattern
Recent trends in woodfuels consumption, real incomes and the level of inflation
A study of the woodfuels situation in Ghana is complicated by the difficulty of its precise quantification. This is due to the impossibility of measuring the volume and weight ofwoodfuels harvested by scattered families and local entrepreneurs all over the country. Moreover, woodfuels come in sticks of varying size, shape, length, split logs, fragments, forest litter, etc. Primary energy balances constructed by the National Energy Board depict the trend in the quantity of woodfuels consumed in the country from 1974 to 1987, as illustrated in Figure 1. There have been steady increases in woodfuels consumed in the country: from 4.208 million toe in 1974 to 5.848 million toe in 1987.
228
Trends in the quantity of woodfuels consumed in the country, real minimum wage (a proxy for real income), and the national consumer price index with 1977 as base year (a proxy for the level of the inflation) within the period covering 1974 to 1987 have been presented in Table 1. The quantity of woodfuels consumed in the country has been increasing steadily since 1974 as evident in Figure 1. Table 1 shows that in 1987, woodfuels consumed in the country stood at 5.848 million toe. ‘Pito is a local alcoholic
beverage
brewed from millet.
ENERGY ECONOMICS
July 1990
Real incomes and the consumption
Table 1. Ghana -quantity
of woodfuels consumed, real minimum wage and national consumer price index (CPI). Quantity of woodfuds coosumed
(toe x 1W) 4.208 4.327 4.45 1 4.570 4.697 4.820 4.950 5.079 5.212 5.349 5.458 5.573 5.709 5.848
1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987
Sources: NEB. Primary Energy Balances October 1987; Statistical Financial Statistics Yearbook 198%. Nofe:
Real minimum
wage was obtained
by deflating
nominal
2.
minimum
Figures 2 and 3 depict trends in real minimum wage and the CPI from 1974 to 1987. Real minimum wages declined from 220.26 cedis per month in 1974 to only 37.43 cedis per month in 1979. It, however, increased to 74.78 cedis per month in the following year, 1980. From 1980 to 1983, real minimum wages further declined to 22.94 cedis per month. In 1987, it stood at 42.51 cedis per month. The CPI, as illustrated in Figure 3, shows that inflation levels have been rising steeply. In 1987, 63.52 cedis were needed to purchase the same bundle of goods that only one cedi did in 1977. A regression analysis of the quantity of woodfuels consumed on the CPI and real minimum wage from 1974 to 1987 produced the following relation with a correlation coefficient (R2) value of 95.8%:
July 1990
1974-87. National consumer
wage (&is per month) 220.26 168.92 108.23 100.00 57.70 37.43 74.78 34.53 28.24 22.94 22.46 47.98 49.53 42.51
price index 1977= 100 22.70 29.60 46.20 100.00 173.30 267.20 401.20 868.70 1062.40 2367.40 3304.20 3647.20 4543.10 6352.00
Service, Quor~er!,. Digest of Statistics, several issues; and IMF Intemationa/
Real minimum wage (cedis per month).
ENERGY ECONOMICS
in Ghana: E. M. Ahakah
Real minimum
wage by CPI.
1975 Figure
ofwoodfuels
1977
Figure 3. Consumer
Wi=5011+0.18
1979
1981
1983
1985
1987
price index (1970 = 100).
Ci-3.96 Ri
(1)
where Wi= quantity of woodfuels consumed in the country in million toe, 1974-87 C’i=consumer price index (CPI), with 1977= 100 Ri= real minimum wage in cedis per month. Equation (1) establishes that: l
The quantity of woodfuels consumed is positively correlated to the CPI. An increase of 0.18% in the CPI will increase the consumption of woodfuels by
l
The quantity of woodfuels consumed is negatively correlated to the real minimum wage in the country.
1%, ceteris paribus.
229
Real incomes and the consumption of nsoodfuels in Ghana: E. M. Abakah 607
50-
Ef;a
Charcoal
m
Ftrewood
Figure 4. Firewood and charcoal prices in selected towns, April-October
An increase of 4% in real minimum wage will decrease the quantity of woodfuels consumed by 1%, ceteris paribus.
Equation (1) also establishes the validity of the working hypothesis postulated at the beginning of the paper.
Discussion and implications The problem of overdependence on woodfuels and its implications is not new to Ghana. The NEB and other institutions have initiated impressive work programmes and projects which aim at redressing the problem. Current on-going projects include: l
l
l
l
the introduction of improved woodfuel burning devices - improved charcoal stoves, sawdust stoves etc, improved charcoal production - demonstration and introduction of efficient charcoal production technologies, introduction and popularization of other energy resources like biogas, LPG etc; and reforestation and community forestry programmes.
In their paper on energy use in some selected cities of developing countries, Sathaye and Meyers [7] found that the kinds of devices used in the home to accomplish energy-requiring activities are determined by the economic resources accessible to households and the general availability of different fuels and energy-using devices. Writing about energy use in Hong Kong, Newcombe [6] concluded that the move from traditional fuels (including woodfuels) and devices to kerosene, gas, or electricity depends on household income.
230
1989.
Compiling data on cooking fuels used in urban households in selected Third World citites in Asia, Sathaye and Meyers [7] outlined the following pattern: ‘A rise in the use of kerosene with income within the lower income groups as income increases further, kerosene gives way to LPG and/or electricity’. In his paper on village woodlot, Turkson [8] noted that purely technical solutions to the rural energy problem might be too simplistic. The writer argues that rural dwellers must have reasonably good incomes to invest in improved energy-saving or energy efficient technologies. Analysis carried out in this paper using data on the quantity of woodfuels consumed, real minimum wages and the consumer price index reechoes the crux of the matter - real incomes and the level of inflation influence the consumption of woodfuels in the country. A recent baseline study carried out by the NEB on the charcoal cycle in Ghana in 19 selected cities exposed high retail prices for woodfuels. This is illustrated in Figure 4. Terna’ recorded the highest average prices per kilogramme of firewood and charcoal within the period covering April to Otober 1988. These were 10.21 and 42.75 cedis respectively. Prominent among the reasons for the high cost of woodfuels as advanced by the study were high transport costs, large number of middlemen etc. A woodfuel survey in Hyderabad, India in 1983 provided a quantitative estimate of changes in woodfuel usage patterns with income [l]. Firewood turned out to be an ‘inferior’ good - its consumption fell as income rose. A 10% increase in income was associated with an 8% decline in firewood consumption. Similarly, this *Terna is a port city in Ghana.
ENERGY
ECONOMICS
July 1990
Real incomes and the consumption ofwoodfiels in Ghana: E. M. Ahakah
paper postulates that ceteris paribus, a 4% increase in real minimum wages will decrease the quantity of woodfuel consumed by 1% or a saving of 58.48 thousand toe of woodfuels, using the 1987 figures as in Table 1. A woodfuel marketing survey carried out in Accra, 11-23 July 1988, as part of the NEB baseline study on the charcoal cycle found that charcoal seemed to be regarded as a ‘dirty commodity’ in the capital city of the country [5]. It could be deduced that with increased incomes and better standards of living most of the low-income urban dwellers (major consumers of woodfuels) will shift to more ‘decent’ sources of fuel supply like LPG, biogas, kerosene etc. The popularization of energy-efficient devices could be enhanced by a possible success of the current gas prospecting activities in the country which could render a less expensive source of energy. This will minimize the current undesirable environmental and health impacts of the less efficient energy devices presently in use in the country. However, as the analysis carried out in this paper and other cited studies have shown, woodfuels consumption is strongly linked to the level of real income and inflationary trends. This, no doubt, has a bearing on the standard of living of the entire population. Given that efficient energysaving devices - gas stoves, improved kerosene stoves, solar devices etc - are fairly expensive, efforts to introduce and popularize their use must incorporate the facilitatory role of increased real incomes or improved standard of living. Cheaper but efficient energy devices could alternatively be developed, but without an improvement in their standard of living and real incomes, the populace will opt for woodfuels as the analysis in this paper and studies in other developing countries have shown.
Conclusion Grave implications of the overdependence on woodfuels in the country have given much cause for alarm. To redress this undesirable situation, efforts are being made to harmonize current woodfuels consumption with existing resources. As part of these efforts other renewable energy resources are being introduced and energy conservation practices are being encouraged. Current trends in the quantity of woodfuels con-
ENERGY
ECONOMICS
July 1990
sumed show a strong linkage with real minimum wage (a proxy for real income) and the national CPI (a proxy for the level of inflation). The quantity of woodfuels consumed is negatively and positively correlated to real incomes and inflation levels respectively. This linkage is also evident in studies carried out in other developing countries. There is also a linkage between the utilization of efficient energy devices and the level of income of the users. To this end, efforts to introduce and popularize the utilization of efficient energy devices could be greatly facilitated by appropriate increases in real incomes. an improvement in the living conditions of the populace and adequate inflation control measures. Further studies should aim at establishing the minimum income level that will induce the populace to patronize the utilization of efficient energy devices. It will be more illuminating to conduct a nationwide survey to collect data on the level of income of users and the kind of energy devices utilized in the home.
References M. Alam, J. Dunkerley, K. Gopi and W. Ramsay, ‘Fuelwood survey of Hyderabad’, Resources for the Future, Washington, DC, 1983. M. R. De Montalembert and J. Clement, Fuelwood Supphes in the Developing Countries, FAO, Rome, 1983. Food and Agriculture Organisation, Tropical Forest Resources: Forestry Paper No 30, Rome, 1982. Ministry of Fuel and Power, Energy and Ghana’s Socioeconomic Development, brief prepared for the PNDC government, Ghana, September 1988. National Energy Board/United Nations Development Programme, The Charcoal Cycle in Ghana - A Baseline Srudy Technical Supplement, Consolidated Report On the Marketing of Woodfuels in Major Centres in Ghana, November 1988. K. Newcombe ‘Energy use in Hong Kong: Part IV: Socioeconomic distribution, patterns of personal energy use, and the energy slave syndrome’, Urban Ecology, Vo14, 1979, pp 179-205. J. Sathaye and S. Meyers, ‘Energy use in cities of developing countries’, Annual Review of Energy, Vol 10, 1985, pp 109-133. J. K. Turskon, ‘Village woodlot: are they solutions to rural energy problems?’ Energy Research Group Newsletter, Vol 10, University of Science and Technology, Kumasi, Ghana, December 1988, pp 27-33. T. S. Wood and S. Baldwin, ‘Fuelwood and charcoal use in developing countries’, Annual Review of Energy, Vol 10, 1985, ~~407-429.
231