Abstract
Abstract Quality and reliable energy has been proven to be necessary and important for a high-quality life and for social and economic development. The United Nations sees reliable energy as a crucial area in the millennium development goals whose purpose is to free the world from poverty, have a healthy planet for future generations and enable all humans to have a life of dignity. Access to energy has positive impacts on socioeconomic aspects such as gender equality, good health and other productive uses, according to literature that I will discuss in this thesis. However, in Sub Saharan Africa energy is often inaccessible and expensive. In Kenya, despite huge investments in infrastructure, connection rates for households are still very low. It is therefore interesting to evaluate how the households themselves view the value of connecting to the electricity grid. The questions I want to answer in this thesis are: What is the willingness to pay for access to electricity for households in Kenya? And what are the most important determinants of this willingness to pay? Using data collected from 160 households in the Rongo constituency in Nyanza, Kenya, I investigate the household’s willingness to pay for connection to the national electricity grid. I find that income plays a huge role in the willingness to pay, and therefore other strategies such as availability of credit markets play an important role in the affordability of electricity. I conclude that households are willing to pay an average of KES 308.93 ($3.08) extra for electricity.