Waste Not: Can Biogas Deliver Sustainable Development?

Household biogas systems are a renewable energy technology with the potential to provide sustainable development benefits by reducing pressure on forest stocks and by shifting household time budgets towards higher value activities or long-term investments in human capital. We estimate the environmental and socioeconomic impacts of biogas expansion in Nepal using an instrumental variables approach that exploits variation in access to biogas installation companies. We confirm prior evidence that biogas use significantly reduces both collected and purchased fuelwood. We find new evidence that biogas substantially changes labor allocations and increases time spent on education. We do not detect robust impacts of biogas on increased local forest cover overall, but we find evidence of positive impacts when biogas is paired with forest protection policies. Together the results suggest that biogas can contribute to sustainable development, particularly in combination with complimentary opportunities or policies that channel improvements towards future household welfare.