Assessing the potential demand for biofuel by combining Economics and Psychology: A focus on proximity applied to Jatropha oil in Africa

Bio-energy demand is known to be influenced by geographical origin and social equity. This paper aims to highlight the influence of the proximity between biomass production and energy consumption on the demand for alternative bio-fuels. In the context of Burkina Faso, we explore potential demand for Jatropha oil (Jatropha curcas) as a diesel substitute among engine owners. Survey data are based on a between-groups design: one group of respondents experiencing a local supply chain, while the other a global one. Results show that proximity has a significant effect on potential demand itself and on the formation and strength of beliefs regarding Jatropha oil. In a local supply chain context, the demand is superior and seems to be guided more by a certain economic and technical rationality. Conversely, the prospect of a Jatropha oil produced outside the village restrains demand and this latter is more determined by contextual factors and social interaction. Our analysis confirms that demand does not only depend on technical and economic factors such as price but also on the integration of the biomass production and processing in the socioeconomic life of local rural populations. Understanding demand construction and assessing underlying beliefs are key success factors for bio-energy projects.