Fuelwood Scarcity, Energy Substitution and Rural Livelihoods in Namibia

In Namibia, as in many parts of Africa, households are highly dependent on fastdegrading forest resources for their livelihoods, including energy needs. Using data originally collected for Namibia's forest resource accounts and insights from a nonseparable household model, this paper empirically estimates household fuelwood demand. In particular, the factors underlying the substitution between fuelwood collected from open access forest resources, cow dung and fuelwood purchased from the market are analysed. Heckman two-step estimates show that households respond to forest scarcity, as measured by the opportunity costs of collecting fuelwood, by increasing labour input to collection more than by reducing energy consumption. There is limited evidence for substitution from fuelwood to other energy sources, particularly with the declining availability of forest stocks. All of the estimated elasticities are low confirming observations made elsewhere, particularly in South Asia. Policy interventions including energy efficiency measures and tree planting schemes are considered in the Namibian context.