Abstract
Electricity is provided by eleven distributional companies in Pakistan and dwellings are attached with the national or mini grids.
Government has attained a reasonable amount of people having electricity access but still there are problems of reliability and outage
exist in consumer perspective. Therefore, people are looking for reliable electricity sources (RES). The current study is designed to
determine the factors affecting the willingness to pay (WTP) for RES in Pakistan and to measure the welfare effect upon providing
electricity to unconnected dwellings. World Bank Survey 2016 containing 8461 households is used for contingent valuation (CV)
analysis and welfare effects. Aggregated and disaggregated analysis is conducted keeping in view the socioeconomics, lifestyle and
climatic factors of the country. Aggregated analysis of CV shows that monthly income, expenditures on electricity, female
respondent, non-agriculture income source, ownership & usage of television, solar awareness, feature of availability and cost saving
are positive and significant factors for WTP. But, usage of non-electric sources for lighting, ownership & usage of fluorescent tube
lights are negative and significant factors for WTP. However, there are province wise variations in CV analysis. Thereof, marginal
effects of selected variables are calculated. Welfare analysis shows the positive gain by connecting the dwellings with the grid in
selected major city of each province. The study shows the variation in factors of WTP at different provinces which has strong policy
implications. It also suggests the renewable potential and feasibility of connecting the new dwellers with renewable energy sources
by the government.
Muhammad Khalid Naeem, Sofia Anwar, Abdul Majeed Nadeem. (2020) Estimating the Willingness to Pay for Reliable Electricity and Welfare Effects: Aggregated and Disaggregated Analysis, Paradigms , Vol 14, Issue 1.
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