Focus group with rural Kenyans on solar-LED lanterns, from a 2009 Berkeley Lab study. [Image: Evan Mills/Berkeley Lab]
Developing countries are well on the road to replacing old, fuel-burning sources of illumination, such as kerosene, candles and wood, with off-grid LED systems fed by stored solar power. That’s a transition with clear benefits in cost-effectiveness and environmental sustainability—but it also threatens the employment of a potentially large number of people whose livelihoods depend on sale and distribution for current, fuel-burning lighting.
A recent report from Evan Mills, a scientist at the Lawrence Berkeley National Laboratory (USA), however, suggests that the developing world’s transition to off-grid LED lighting could create an order of magnitude more jobs than it eliminated (Energy for Sust. Dev., doi: 10.1016/j.esd.2016.06.001). Indeed, the study concludes that the number of jobs created by the transition so far already exceeds the roughly 150,000 jobs tied to the fuels-based-lighting economy—and that as many as two million new jobs could be created to fully serve the 112 million poorest households currently lacking electricity access.
Informal economy
In the developed world, the transition away from fuels-based lighting began more than a century ago, as industrialized countries moved into new illumination sources such as arc lighting and incandescent lamps. In the developing world, where access to centralized electricity is dicier, many countries are moving directly to more local, energy-efficient off-grid approaches using solar LED lanterns. Mills, who notes that this transition is “well under way,” set himself to putting some numbers on the transition’s potential impact on employment.
The first step was to determine the number of people whose livelihoods rest on the current fuels-based-lighting economy. Quantifying that economy is tricky, as it includes a dispersed, informal network of fuel and equipment suppliers and hawkers outside of the reach of conventional statistics. The business also includes a large component of black-market activity and child labor.
Quantifying “employment intensity”
To get at a current number, Mills looked at field studies of fuels-based employment in specific localities in a number of countries in East Africa and elsewhere in the developing world, and derived estimated the “employment intensity” associated with specific markets. Then, scaling those numbers up to the broader non-electrified population, he concluded that the informal fuels-based-lighting economy today provides 150,000 jobs worldwide.
For the emerging solar-LED economy, Mills was able to do a similar employment-intensity analysis—but also to supplement it with information from manufacturers and suppliers involved in serving the market. Putting these numbers together, he estimated that every million solar-LED lanterns sold into the developing world provides an estimated 17,000 jobs.
Applying that estimate only to the 112 million poorest households, completely cut off at present from the electrical grid—and assuming a target of three lanterns per household and a three-year product lifetime—implies an addition of nearly two million of jobs. That number easily eclipses the 150,000 jobs thought to be tied to the fuels-based economy that would be lost. And if the more than 150 million additional households with intermittent or limited access to electricity were included, the estimated job gain might be substantially higher.
Benefits and challenges
Behind the numbers, Mills acknowledges that in the near term, the ongoing shift to solar LEDs, while carrying high social benefits, will cause some serious dislocations. Although he says the solar-LED employment picture in general comprises “much better jobs”—legal, healthy, and more stable than employment in the informal fuels-based economy—the jobs also tap different skill sets, and may require a significant training and education effort.
“The challenge of re-employing some of these people is not trivial,” he notes in a press release associated with the research. And, he writes in the paper’s conclusion, it suggests a key role for policymakers: “to maximize the pace of job creation associated with new technologies and businesses that can replace inefficient and polluting lighting fuels, while proactively minimizing disruption as the transition proceeds.”