The relationship between income and demand for energy commodities in Malawi: the case of South Lunzu Township

Abstract

This study analysed the effect of household income on demand for electricity and fuel-wood in South Lunzu Township of Blantyre city, Malawi. Survey data was collected through a semi-structured questionnaire. Using Engel function analysis employed in ordinary least squares framework, the study found a negative relationship between fuel-wood and income and a positive relationship between income and electricity expenditure. This shows that fuel-wood is regarded as an inferior commodity and electricity is a preferred energy facility. Other factors that explain the behaviour of choice between fuel-wood and electricity included home size, perception on well-being, age of the head of household, education of the head of household, and total expenditure. Campaigns aimed at changing the mindset of people such as those regarding renewable energy as solutions for rural areas only need to be intensified.