Subsidise the stove, not the electricity: market distortions and clean-cooking subsidies in sub-Saharan Africa
A randomised trial of 2,000 households in Kenya finds that upfront subsidies can effectively encourage the shift from charcoal to electric cooking, while electricity-use subsidies have no measurable impact. Credit constraints prevent high-usage households from purchasing electric stoves, making upfront subsidies particularly effective at reaching households with the greatest potential for energy savings and emissions reductions. Electric cooking cuts adopting households' energy bills by 36% and abates around 2. 5 tCO₂e per year at a cost of roughly USD 13 per tonne, suggesting that purchase subsidies targeted where financial distortions are greatest could be a highly cost-effective climate policy.
Policy brief13 Aug 2026EnergyandSustainable GrowthA randomised trial of 2,000 households in Kenya finds that upfront subsidies can effectively encourage the shift from charcoal to electric cooking, while electricity-use subsidies have no measurable impact. Credit constraints prevent high-usage households from purchasing electric stoves, making upfront subsidies particularly effective at reaching households with the greatest potential for energy savings and emissions reductions. Electric cooking cuts adopting households' energy bills by 36% and abates around 2. 5 tCO₂e per year at a cost of roughly USD 13 per tonne, suggesting that purchase subsidies targeted where financial distortions are greatest could be a highly cost-effective climate policy. Berkouwer-Dean-Policy-Brief-June-2026. pdfDownloadPDF document • 260. 89 KBA randomised trial with 2,000 households in Kenya tests how market distortions change which subsidies move households from charcoal to electric cooking, and how much carbon abatement each subsidy dollar achieves. Subsidising the electricity that a stove uses has no measurable effect. Cutting the price of electricity used for electric cooking by as much as 75% did not detectably change whether households bought a stove or how much they cooked with it. Subsidising the upfront price does work, and distortions make it work more cost-effectively. Limited access to credit and similar frictions keep high-usage households out of the market: they would benefit from the stove but cannot cover its upfront cost. That creates an opportunity for upfront subsidies to be pivotal for the households that save and abate (prevent emissions) the most. The larger the distortion, the more emissions each subsidy dollar abates. Subsidising electric cooking is a cheap climate policy. An adopting household cuts its energy bill by 36%. It abates about 2. 5 tCO₂e/year, at a subsidy cost of roughly USD 13 /t abated—well below the cost of comparable climate measures in rich countries. For policy, this means subsidising the purchase rather than the kilowatt-hour, and directing that spending to where distortions are largest, which points towards low- and middle-income countries. ThemesEnergySustainable GrowthCountriesTanzania