Drivers of Household Electricity Demand in Rural India

Even as India pursues universal electricity access, household electricity demand remains poorly understood. While studies have investigated residential electricity consumption, most focus on urban consumers, even though a majority of the newly electrified households are in rural areas. Using primary data on 10,000 households, we investigate rural electricity demand in 200 villages in Uttar Pradesh, Bihar, Odisha, and Rajasthan. We rely on energy use surveys that capture appliance use and multiple energy sources. We find that the surveyed households typically consume 39.3 kWh per month during the summer months, which is half of the country's average residential consumption. We also find that hours of grid-electricity supply predicts demand: every 1% increase in supply hours is associated with 1.245% increase in demand. Our findings suggest that improved supply can lead to significant welfare gains for consumers, and allow discoms to tap into the unmet electricity demand in rural areas