Factors Determining Household Fuel Choice in Guatemala

Abstract

This paper discusses the factors guiding household choices of cooking fuels. This is crucial for policies to combat indoor air pollution. Household income is an important, but not the only, factor. Opportunity costs of firewood also play an essential role. Empirical results are based on the 2000 Guatemalan LSMS survey, which includes a detailed section on energy use. Patterns of fuel use, energy spending, Engel curves, multiple fuels, the extent of fuel switching, and the determinants of fuel choice are analyzed.It is common in Guatemala to use multiple fuels for cooking: 48 and 27 percent of urban and rural households do so. Modern fuels are often used alongside traditional solid fuels; modern fuels thus fail to displace solid fuels in many cases, particular in rural areas and the urban bottom half. This is paradoxical since a significant share of firewood users buy wood from the market, incurring costs that are substantial, also in comparison with the costs of modern fuels.

Keywords: Fuel wood, indoor air pollution, Guatemala

JEL Classification: O12