Fuelwood scarcity, energy substitution, and rural livelihoods in Namibia

ABSTRACT In Namibia, as in many parts of Africa, households are highly dependent on forest resources for their livelihoods, including energy needs. Using data originally collected for Namibia's forest resource accounts and insights from a non-separable household model, this paper estimates household fuelwood demand. Specifically, the factors underlying the substitution between fuelwood collected from open access forest resources, cow dung, and fuelwood purchased from the market are analysed. Heckman two-step estimates show that households respond to economic scarcity, as measured by the opportunity costs of collecting fuelwood, by reducing energy consumption slightly more than by increasing labour input to collection. There is limited evidence for substitution from fuelwood to other energy sources, particularly with declining availability of forest stocks. Market participants may be more sensitive to price changes than non-participants. All estimated elasticities are low, similar to those observed in previous studies.