The determinants of rural electrification: The case of Bihar, India

This paper explores intra-state disparity in access to electricity and examines the determinants of electrification at the village level in Bihar, one of the underdeveloped states in India. Our field survey of 80 villages in 5 districts conducted in 2008–09 found that 48 villages (60%) are electrified when using the definition of electrification that a village is electrified if any one household in the village is connected to electricity. In the processes of electrification, approximately 40% of villages have been electrified in recent years. The econometric analyses demonstrate that location is the most important determinant of a villageʹs electricity connection. Another important finding is that with the rapid progress of rural electrification under the recent government program and the tendency to connect the villages that are easily accessible, the collective bargaining power of the village, which used to significantly affect the process of electrification, has lost influence. This adversely affects remote villages. In order to extend electricity supplies to remote and geographically disadvantaged villages, the government needs to consider other options for sustainable electricity supply, such as decentralized distribution of electricity rather than the conventional connection through the national/local grids.