A fresh look at IAP

Anyone who's dabbled in the social enterprise space is quite familiar with smokeless/improved cook stoves.  For years, NGOs and social entrepreneurs have struggled to bring a product to market that is acceptable to (largely) rural households at a price point they can both afford and are willing to pay.  While the  initial thrust behind this was a desire to reduce families', and in particular women's, exposure to indoor air pollution, a recent article in the NYT highlights the connection - black carbon - between the cooking habits of the rural poor in many developing countries and climate change.  (Also see Raj Kundra's related post here on the Acumen Fund blog.)

 

Improved cook stoves may have the potential to significantly reduce indoor air pollution and decrease black carbon emissions associated with rural cooking practices.  (While I know they exist, I haven't seen the emissions reduction profiles of the leading improved chulas on the market.) However, it seems like there may be other options that have been overlooked.

 

Social entrepreneurs are increasingly finding that the BoP are - not surprisingly - more willing to pay for products and services that have aspirational value associated with them. For cooking in India, LPG is the gold standard; middle class, upper middle class, and the uber wealthy in India all have LPG cook stoves in their homes.  Additionally, across rural India, where the supply chain reaches, LPG is the cooking fuel of choice for those who can afford it. 

 

While I'm a strong supporter of renewable energy and generally don't support increased reliance on fossil fuels, at first blush it seems like putting LPG in the homes of the BoP would be one way to accomplish the dual goals of simultaneously: 1) reducing indoor air pollution and 2) eliminating black carbon emissions associated with cooking (climate scientists please correct me if I'm wrong here).  With LGP you avoid the tough tasks of demand aggregation and customer education - people already want LPG in their homes.

 

What would it take to do this? First, you'd have to grapple with how to re-tool LPG public distribution system/supply chain  to ensure it reliably reached deep corners of rural India. Second, you'd have to re-structure the LPG subsidy to ensure it was within the financial reach of the BoP.  (Obviously, you'd also want to take a hard look at the cost, feasibility,  as well as  environmental and geopolitical implications of a large uptick in LPG use.)

 

Tinkering with the  public distribution system and a public subsidy surely lack the flare and appeal of new technologies and social enterprise. However, this approach - or one similar to it - might be worth a closer look.