Publication: Quantifying Carbon and Distributional Benefits of Solar Home System Programs in Bangladesh
Loading...
Published
2011-01-01
ISSN
Date
2012-03-19
Author(s)
Editor(s)
Abstract
Scaling-up adoption of renewable energy technology, such as solar home systems, to expand electricity access in developing countries can accelerate the transition to low-carbon economic development. Using a purposely collected national household survey, this study quantifies the carbon and distributional benefits of solar home system programs in Bangladesh. Three key findings are generated from the study. First, dissemination of solar home systems brings about significant carbon benefits: the total carbon emissions avoided from replacing kerosene use for lighting by solar home systems in non-electrified rural households was equivalent to about 4 percent of total annual carbon emissions in Bangladesh in 2007. This figure increases to about 15 percent if the grid-electricity generation is used as the energy baseline to estimate the carbon avoided from the installation of solar home systems. Second, solar home system subsidies in rural Bangladesh are progressive when the program is geographically targeted. Third, there exists a market potential for solar home systems in many rural areas if micro-credit schemes are made available and the propensity to install solar home systems is very responsive to income, with a 1-percent increase in per capita income increasing the probability of installing solar home systems by 12 percent, controlling for other factors.
Link to Data Set
Citation
“Wang, Limin; Bandyopadhyay, Sushenjit; Cosgrove-Davies, Mac; Samad, Hussain. 2011. Quantifying Carbon and Distributional Benefits of Solar Home System Programs in Bangladesh. Policy Research working paper ; no. WPS 5545. © World Bank. http://hdl.handle.net/10986/3316 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Publication The Economic Value of Weather Forecasts: A Quantitative Systematic Literature Review(Washington, DC: World Bank, 2025-09-10)This study systematically reviews the literature that quantifies the economic benefits of weather observations and forecasts in four weather-dependent economic sectors: agriculture, energy, transport, and disaster-risk management. The review covers 175 peer-reviewed journal articles and 15 policy reports. Findings show that the literature is concentrated in high-income countries and most studies use theoretical models, followed by observational and then experimental research designs. Forecast horizons studied, meteorological variables and services, and monetization techniques vary markedly by sector. Estimated benefits even within specific subsectors span several orders of magnitude and broad uncertainty ranges. An econometric meta-analysis suggests that theoretical studies and studies in richer countries tend to report significantly larger values. Barriers that hinder value realization are identified on both the provider and user sides, with inadequate relevance, weak dissemination, and limited ability to act recurring across sectors. Policy reports rely heavily on back-of-the-envelope or recursive benefit-transfer estimates, rather than on the methods and results of the peer-reviewed literature, revealing a science-to-policy gap. These findings suggest substantial socioeconomic potential of hydrometeorological services around the world, but also knowledge gaps that require more valuation studies focusing on low- and middle-income countries, addressing provider- and user-side barriers and employing rigorous empirical valuation methods to complement and validate theoretical models.Publication The Macroeconomic Implications of Climate Change Impacts and Adaptation Options(Washington, DC: World Bank, 2025-05-29)Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.Publication Labor Demand in the Age of Generative AI: Early Evidence from the U.S. Job Posting Data(Washington, DC: World Bank, 2025-11-18)This paper examines the causal impact of generative artificial intelligence on U.S. labor demand using online job posting data. Exploiting ChatGPT’s release in November 2022 as an exogenous shock, the paper applies difference-in-differences and event study designs to estimate the job displacement effects of generative artificial intelligence. The identification strategy compares labor demand for occupations with high versus low artificial intelligence substitution vulnerability following ChatGPT’s launch, conditioning on similar generative artificial intelligence exposure levels to isolate substitution effects from complementary uses. The analysis uses 285 million job postings collected by Lightcast from the first quarter of 2018 to the second quarter of 2025Q2. The findings show that the number of postings for occupations with above-median artificial intelligence substitution scores fell by an average of 12 percent relative to those with below-median scores. The effect increased from 6 percent in the first year after the launch to 18 percent by the third year. Losses were particularly acute for entry-level positions that require neither advanced degrees (18 percent) nor extensive experience (20 percent), as well as those in administrative support (40 percent) and professional services (30 percent). Although generative artificial intelligence generates new occupations and enhances productivity, which may increase labor demand, early evidence suggests that some occupations may be less likely to be complemented by generative artificial intelligence than others.Publication External Finance in Emerging Markets and Developing Economies: A Tale of Differences in Vulnerabilities(Washington, DC: World Bank, 2025-12-04)Over the past two decades, many emerging markets and developing economies have been viewed as increasingly resilient to external financial shocks. This paper assesses whether such resilience is broadly shared across emerging markets and developing economies by classifying them into three tiers based on economic size, income level, institutional strength, and financial integration. The analysis shows that first-tier emerging markets and developing economies have improved their external balance sheets and reduced dependence on official support. However, second- and third-tier emerging markets and developing economies have experienced growing external vulnerabilities since the global financial crisis, marked by rising external debt liabilities and declining foreign exchange reserves. Using a range of indicators, including sovereign defaults, arrears, partial defaults, and International Monetary Fund lending, the paper identifies episodes of external financial distress and shows that distress remains widespread among second- and third-tier emerging markets and developing economies. The empirical analysis confirms that key components of the net international investment position—especially external debt and foreign exchange reserves—predict the onset of external financial distress, with institutional quality shaping the impact. Weak institutions amplify risks, while strong institutions mitigate them. These findings highlight the importance of recognizing heterogeneity across emerging markets and developing economies, strengthening institutional quality alongside external balance-sheet management, and rebuilding buffers to safeguard against renewed global financial stress.Publication Rigging the Scores: Corruption through Scoring Rule Manipulation in Public Procurement Auctions(Washington, DC: World Bank, 2025-12-02)Public procurement is highly susceptible to corruption, especially in developing countries. Although open auctions are widely adopted to curb it, this paper finds that corruption remains prevalent even within this procurement format. Procurement officers can collaborate with firms to manipulate scoring rules, ensuring predetermined winners, while corrupt firms submit noncompetitive bids to meet minimum bidder requirements. Using extensive data from Chinese public procurement auctions, the paper introduces model-driven statistical tools to detect such corruption, identifying a corruption rate of 65 percent. A procurement expert audit survey confirms the tools’ reliability, with a 91 percent probability that experts recognize suspicious scoring rules when flagged. Firm-level analysis reveals that local, state-owned, and less productive firms are favored in corrupt auctions. Lastly, the paper explores policy implications. Analysis of the national anti-corruption campaign since 2012 suggests that general investigations may be insufficient to address deeply ingrained corrupt practices. Using counterfactuals based on an estimated structural model, the paper shows that implementing anonymous call-for-tender evaluations could improve social welfare by 10 percent by eliminating suspicious rules and encouraging broader participation.
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Promoting Energy Access Projects under the Clean Development Mechanism : Standardized Baselines and Suppressed Demand(World Bank, Washington, DC, 2011-01)New concepts under the Clean Development Mechanism (CDM), namely standardized baselines and suppressed demand, should facilitate the implementation of CDM energy access projects, particularly in Least Developed Countries (LDCs), by reducing transaction costs and reflecting the real emission reductions achieved. Governments and authorities in LDCs can play a prominent role in making these new CDM opportunities available. The improvement of the regulatory framework can facilitate the development of innovative carbon-based financing schemes required for successful scaling-up of CDM energy access projects in LDCs. The main purpose of this paper is to outline how the new CDM concepts of standardized baselines and suppressed demand may be used to promote energy access projects under the CDM, in the context of new and expanded role of host country Designated National Authorities (DNAs). In the process, the paper also identifies challenges in the use of these concepts and opportunities for further simplification. By way of illustration, one specific energy access technology, solar home systems, is analyzed in detail. The paper is organized as follows: chapter one is introduction; chapter two provides an overview of the current status of CDM projects in LDCs; chapter three introduces energy access projects in LDCs; chapter four outlines new approaches under the CDM for energy access projects; chapter five goes into the challenges for the application of standardized baselines in LDCs; and chapter six gives recommendations on implementing the new CDM concepts.Publication Scaling Up Access to Electricity : The Case of Bangladesh(World Bank, Washington, DC, 2014-06-13)This knowledge note is the second of three case studies that concerns scaling up access to electricity in Africa, Bangladesh, and Rwanda. Since its inception in 2003, Bangladesh's solar home system program has installed about three million electrification systems in rural households, two-thirds of them in the last three years. The program is the most dynamic off-grid electrification program in the world, benefitting more than 15 million people and contributing about 130 MW in renewable energy generation capacity. The case study for Bangladesh is interesting, because off-grid electrification is crucial to reaching universal access. Achieving universal access to modern energy services is one of the three complementary objectives of the Sustainable Energy for All (SE4ALL) initiative. Bangladesh's rural electrification program was initiated in 1977 with the creation of the Rural Electrification Board (REB). Yet, it was estimated that at the prevailing pace of grid electrification, Bangladesh was going to take 50 years to reach universal access. By 2002, it had become apparent that an off-grid approach was needed to complement efforts to extend the grid. When the World Bank's first RERED project was being designed in 2002, a two-pronged approach was adopted to promote the use of solar home systems in rural areas, thereby leveraging the country's renewable energy potential, while continuing to help the REB and rural cooperatives improve their operational and financial performance. The program s final design is a good example of how international experience and local know-how can come together to yield an innovative design that suits the country's circumstances. The project's design was flexible (with a range of subsidies and system sizes, for example), allowing for quick adaptation to evolving technology and market conditions, and to consumer feedback.Publication Lessons from Output-Based Aid for Leveraging Finance for Clean Energy(World Bank, Washington, DC, 2012-09)This paper focused on the delivery mechanisms for bilateral, multi-lateral, host government subsidy, and consumer cross-subsidy funding to enhance private sector investment. However, the specific source of funds is not deemed to be especially relevant for the purposes of this working paper. Focus on some of the useful characteristics of Output-Based Aid (OBA) experience to date that may be relevant. Propose an option for how OBA experience could be used to deliver national and programmatic supports to projects in middle- and low-income countries in coordination with other multi-lateral development bank instruments such as concessional loans and credits. This working paper does not: specifically address strengths and weaknesses of the clean development mechanism and only briefly touches on issues with using carbon finance in the current market. Carry out an assessment of experience with feed-in tariffs or advanced market commitments, or indeed other results orientated schemes.Publication The Economics of Renewable Energy Expansion in Rural Sub-Saharan Africa(World Bank, Washington, DC, 2010-01)Accelerating development in Sub-Saharan Africa will require massive expansion of access to electricity -- currently reaching only about one-third of households. This paper explores how essential economic development might be reconciled with the need to keep carbon emissions in check. The authors develop a geographically explicit framework and use spatial modeling and cost estimates from recent engineering studies to determine where stand-alone renewable energy generation is a cost effective alternative to centralized grid supply. The results suggest that decentralized renewable energy will likely play an important role in expanding rural energy access. But it will be the lowest cost option for a minority of households in Africa, even when likely cost reductions over the next 20 years are considered. Decentralized renewables are competitive mostly in remote and rural areas, while grid connected supply dominates denser areas where the majority of households reside. These findings underscore the need to de-carbonize the fuel mix for centralized power generation as it expands in Africa.Publication Surge in Solar-Powered Homes : Experience in Off-Grid Rural Bangladesh(World Bank, Washington, DC, 2014-10-08)Bangladesh has made remarkable progress in raising living standards and reducing poverty, particularly in previously lagging regions. Rapid solar home system (SHS) expansion in Bangladesh to some 3 million rural households by early 2014 has drawn the attention of donors and governments of other countries. The book s broad aim is twofold: (a) to assess the welfare impact of SHS on households, and (b) to evaluate the present institutional structure and financing mechanisms in place, noting that households want cheaper systems and good quality service while suppliers require a reasonable market-based profit to stay in business. The study entailed an intensive empirical investigation based on both primary and secondary data. The primary data consisted mainly of a large-scale, nationally representative household survey with appropriate geographic spread. Conducted in 2012 by the Bangladesh Institute of Development Studies (BIDS) and assisted by the World Bank, the household survey was designed to examine SHS benefits and costs. The book addresses a number of research issues, which are grouped according to general and gendered household impact, program delivery and monitoring of technical standards, market size and demand, and carbon emissions reduction. The book also analyzes household uses of solar-electric energy services. Typically, SHS models are used for lighting, powering fans and television sets, and charging mobile devices and other electrical equipment. Finally, the book evaluates the gender-disaggregated benefits and women's empowerment from SHS adoption. The gender analysis included two major research questions: (a) can the socioeconomic status of rural women be enhanced by increasing the opportunity to participate in alternative energy-service delivery, and (b) if SHS brings positive impacts in terms of social indicators, what additional efforts can supplement them to bring about a radical shift in gender roles and responsibilities. The book's findings show that better household lighting improves household welfare both directly and indirectly. The book has eight chapters. Chapter one is introduction. Chapter two describes the current status of Bangladesh's SHS expansion program, including salient features of system operation, as well as program delivery and financing. Chapter three reviews the role of electrification in rural development and international experience in using SHS as a complementary solution in remote off-grid areas. Based on the survey data findings, chapter four identifies the major drivers of SHS adoption and system capacity selection at the household and village level, while chapter five discusses and estimates the welfare benefits. Chapter six focuses on SHS market analysis and role of the subsidy, including consumers' willingness to pay and the potential impact of subsidy phase-out. Chapter seven turns to the quality of partner organization (PO) service and other supply-side issues, along with market constraints to meet future demand. Finally, chapter eight offers policy perspectives and a way forward.
Users also downloaded
Showing related downloaded files
Publication Classroom Assessment to Support Foundational Literacy(Washington, DC: World Bank, 2025-03-21)This document focuses primarily on how classroom assessment activities can measure students’ literacy skills as they progress along a learning trajectory towards reading fluently and with comprehension by the end of primary school grades. The document addresses considerations regarding the design and implementation of early grade reading classroom assessment, provides examples of assessment activities from a variety of countries and contexts, and discusses the importance of incorporating classroom assessment practices into teacher training and professional development opportunities for teachers. The structure of the document is as follows. The first section presents definitions and addresses basic questions on classroom assessment. Section 2 covers the intersection between assessment and early grade reading by discussing how learning assessment can measure early grade reading skills following the reading learning trajectory. Section 3 compares some of the most common early grade literacy assessment tools with respect to the early grade reading skills and developmental phases. Section 4 of the document addresses teacher training considerations in developing, scoring, and using early grade reading assessment. Additional issues in assessing reading skills in the classroom and using assessment results to improve teaching and learning are reviewed in section 5. Throughout the document, country cases are presented to demonstrate how assessment activities can be implemented in the classroom in different contexts.Publication Argentina Country Climate and Development Report(World Bank, Washington, DC, 2022-11)The Argentina Country Climate and Development Report (CCDR) explores opportunities and identifies trade-offs for aligning Argentina’s growth and poverty reduction policies with its commitments on, and its ability to withstand, climate change. It assesses how the country can: reduce its vulnerability to climate shocks through targeted public and private investments and adequation of social protection. The report also shows how Argentina can seize the benefits of a global decarbonization path to sustain a more robust economic growth through further development of Argentina’s potential for renewable energy, energy efficiency actions, the lithium value chain, as well as climate-smart agriculture (and land use) options. Given Argentina’s context, this CCDR focuses on win-win policies and investments, which have large co-benefits or can contribute to raising the country’s growth while helping to adapt the economy, also considering how human capital actions can accompany a just transition.Publication Lebanon Economic Monitor, Fall 2022(Washington, DC, 2022-11)The economy continues to contract, albeit at a somewhat slower pace. Public finances improved in 2021, but only because spending collapsed faster than revenue generation. Testament to the continued atrophy of Lebanon’s economy, the Lebanese Pound continues to depreciate sharply. The sharp deterioration in the currency continues to drive surging inflation, in triple digits since July 2020, impacting the poor and vulnerable the most. An unprecedented institutional vacuum will likely further delay any agreement on crisis resolution and much needed reforms; this includes prior actions as part of the April 2022 International Monetary Fund (IMF) staff-level agreement (SLA). Divergent views among key stakeholders on how to distribute the financial losses remains the main bottleneck for reaching an agreement on a comprehensive reform agenda. Lebanon needs to urgently adopt a domestic, equitable, and comprehensive solution that is predicated on: (i) addressing upfront the balance sheet impairments, (ii) restoring liquidity, and (iii) adhering to sound global practices of bail-in solutions based on a hierarchy of creditors (starting with banks’ shareholders) that protects small depositors.Publication Digital Africa(Washington, DC: World Bank, 2023-03-13)All African countries need better and more jobs for their growing populations. "Digital Africa: Technological Transformation for Jobs" shows that broader use of productivity-enhancing, digital technologies by enterprises and households is imperative to generate such jobs, including for lower-skilled people. At the same time, it can support not only countries’ short-term objective of postpandemic economic recovery but also their vision of economic transformation with more inclusive growth. These outcomes are not automatic, however. Mobile internet availability has increased throughout the continent in recent years, but Africa’s uptake gap is the highest in the world. Areas with at least 3G mobile internet service now cover 84 percent of Africa’s population, but only 22 percent uses such services. And the average African business lags in the use of smartphones and computers as well as more sophisticated digital technologies that catalyze further productivity gains. Two issues explain the usage gap: affordability of these new technologies and willingness to use them. For the 40 percent of Africans below the extreme poverty line, mobile data plans alone would cost one-third of their incomes—in addition to the price of access devices, apps, and electricity. Data plans for small- and medium-size businesses are also more expensive than in other regions. Moreover, shortcomings in the quality of internet services—and in the supply of attractive, skills-appropriate apps that promote entrepreneurship and raise earnings—dampen people’s willingness to use them. For those countries already using these technologies, the development payoffs are significant. New empirical studies for this report add to the rapidly growing evidence that mobile internet availability directly raises enterprise productivity, increases jobs, and reduces poverty throughout Africa. To realize these and other benefits more widely, Africa’s countries must implement complementary and mutually reinforcing policies to strengthen both consumers’ ability to pay and willingness to use digital technologies. These interventions must prioritize productive use to generate large numbers of inclusive jobs in a region poised to benefit from a massive, youthful workforce—one projected to become the world’s largest by the end of this century.Publication World Development Report 2006(Washington, DC, 2005)This year’s Word Development Report (WDR), the twenty-eighth, looks at the role of equity in the development process. It defines equity in terms of two basic principles. The first is equal opportunities: that a person’s chances in life should be determined by his or her talents and efforts, rather than by pre-determined circumstances such as race, gender, social or family background. The second principle is the avoidance of extreme deprivation in outcomes, particularly in health, education and consumption levels. This principle thus includes the objective of poverty reduction. The report’s main message is that, in the long run, the pursuit of equity and the pursuit of economic prosperity are complementary. In addition to detailed chapters exploring these and related issues, the Report contains selected data from the World Development Indicators 2005‹an appendix of economic and social data for over 200 countries. This Report offers practical insights for policymakers, executives, scholars, and all those with an interest in economic development.