Vouchers Can Create a Thriving Market for Distributed Power Generation in Developing Countries

Energy Research and Social Science, Forthcoming

18 Pages Posted: 30 Jul 2018  

Johannes Urpelainen

Johns Hopkins SAIS

Date Written: June 25, 2018

Abstract

I propose that vouchers offer a promising approach to making distributed power generation, such as solar home systems, affordable to consumers and profitable for producers and distributors. In a voucher-based system, governments give vouchers to eligible beneficiaries, who then use the vouchers to purchase qualifying products and services. This system enables consumer choice, helps the poor with the affordability of distributed energy products, and injects money into the market for relevant products and services. I discuss practical implementation challenges and argue that digitalization allows governments to significantly reduce corruption and red tape, making vouchers a realistic energy access policy for many governments all over the world.

Keywords: rural electrification, solar power, distributed energy, energy access, energy policy

Suggested Citation

Urpelainen, Johannes, Vouchers Can Create a Thriving Market for Distributed Power Generation in Developing Countries (June 25, 2018). Energy Research and Social Science, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3210494

Johannes Urpelainen (Contact Author)

Johns Hopkins SAIS ( email )

1740 Massachusetts Avenue, NW
Washington, DC 20036-1984
United States

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