Power of Haas Ideas


Profs. Catherine Wolfram and Paul Gertler seek to quantify the economic power of reliable energy

Access to reliable energy sources holds the power to build stronger economies and healthier populations. Now it’s time to quantify it.

That’s the goal that Berkeley Haas professors Catherine Wolfram and Paul Gertler are seeking through a five-year, $18.5 million research grant from the United Kingdom’s Department for International Development. Wolfram is the research director and Gertler the deputy research director of the Applied Research Programme on Energy and Economic Growth, led jointly by UC Berkeley’s Energy Institute at Haas and Center for Effective Global Action and by Oxford Policy Management, an international development consultancy based in the UK.

BerkeleyHaas recently spoke with Wolfram about goals for the grant.

You’re at the start of an exciting project. What are your main goals?
We want to better understand the mechanism through which energy investments contribute to economic growth in Sub-Saharan Africa and South Asia. It could be directly through benefits to individual households or more broadly in the industrial sector by providing better jobs. Or maybe it’s also through hospitals and schools and the services they provide.

Energy is a big field. Any particular areas of study?
Mainly, the role that electricity plays in economic growth. But we’ll also study the effects of extracted oil and natural gas, because they can also influence the electricity industry. Countries like Nigeria, for instance, have a lot of oil and diesel available, and some researchers argue that this has made it easy for the local electric companies to get away with poor reliability. People who are rich enough have backup generators running on diesel so reliable grid electricity is not critical to the elite.

Where will your research be focused?
Sub-Saharan Africa and South Asia, but we may study some other middle-income countries, as well—places like Mexico and parts of Latin America—to see what happens to a country once it gets nearly full electricity access.

How will the study work?
We’re putting together a worldwide network of researchers who will engage with policymakers to learn about the main barriers they see to developing their energy sectors. If we engage with stakeholders early in the process, we hope we’ll be able to influence policy later on.

We’ll also be doing a lot of field research. In Kenya, for instance, we’re working with the Rural Electrification Authority, and we’ve subsidized rural households to connect to the electricity grid. People in our study have been connected for about two years, and we want to see how having electricity has impacted their lives. For instance, do kids study more at night? Have people started businesses? On the other hand, we may find that the impacts are minimal, suggesting that getting electricity into every rural home may not be the best way to drive economic growth and development. A better way might be getting reliable and high-quality electrical service to commercial establishments that can create jobs. Or getting reliable electricity to health centers so they can refrigerate vaccines and offer better services at night. We need more research to sort through the alternatives. —Interview with James Daly

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