Examining fuel choice patterns through household energy transition index: an alternative to traditional energy ladder and stacking models

The transition toward cleaner fuels is considered an essential component to achieve sustainable economic development due to its environmental and health-related implications. However, the disarray among academicians on the explanatory power of existing models of energy transition has restrained its practical implementation. This study develops an alternative to explain energy transition at the household level by proposing “6Es” framework to rank various fuels and formulate a household energy transition index. This index includes the virtues of both the energy ladder and the energy stacking models. Multinomial logit model has been employed to test the traditional energy ladder hypothesis, and OLS has been used to estimate household energy transition index at the aggregated level as well as at the disaggregated provincial level in Pakistan. Contrary to the previously developed indices, the estimated results of the energy transition index significantly explain the changes in fuel consumption. The results indicate that income is not the only factor that affects energy transition. Household-specific factors such as prices, size, education, profession, and area also play an imperative role. Our estimates suggest that rural households are 22 percent more likely to consume primitive fuels. The findings suggest that prices of primitive fuels affect energy transition index in rural areas. Variable such as education and female bargaining power are positively linked with energy transition.