Modeling household cooking fuel choice: A panel multinomial logit approach

- There was no major shift from traditional to cleaner fuels following economic growth during 2000 - 2009 in urban Ethiopia.
- Households use multiple fuels as they get richer.
- Households' economic status and education, as well as the price of alternative energy sources, are important determinants of fuel choice in urban Ethiopia.

We use three rounds of a rich panel data set to investigate the determinants of household cooking fuel choice and energy transition in urban Ethiopia. We observe that the expected energy transition did not occur following economic growth in Ethiopia during the decade 2000-2009. Regression results from a random effects multinomial logit model, which controls for unobserved household heterogeneity, show that households' economic status, price of alternative energy sources, and education are important determinants of fuel choice in urban Ethiopia. The results also suggest the use of multiple fuels, or 'fuel stacking behavior'. We argue that policy makers could target these policy levers to encourage transition to cleaner energy sources.