Rural Electrification

Summary: Rural electrification brings electricity to rural communities and customers, an effort that began in the 1930s in the United States.

Rural electrification is the process of making electrical power available to rural areas and customers. It is most strongly associated with the Rural Electrification Administration (REA) established by the New Deal in 1936, which greatly accelerated the electrification of the rural United States.

At the time, the process of electrification that had been so rapid in the nineteenth century had slowed to a crawl. Cities had been electrified, those suburbs that existed had been electrified, and 90 percent of city residents had electricity. But only 10 percent of rural Americans did, and getting power to them was not considered economically feasible. While bringing electricity to the country would benefit the American economy by increasing agricultural production, creating new customers for electricity (even the sale of new electric lights was a significant economic gain), and making rural commercial interests more competitive, those economic gains would not be seen directly by the companies responsible for laying the wire and setting up the equipment to electrify the region. Those companies that did provide electricity to the countryside charged as much as four times as much per kilowatt-hour as they did in the city, in order to maintain their profit margin; further, in some cases they required payment in advance of installation, by farmers or groups of farmers, in order to finance construction of the electric grid.

The Rural Electrification Act provided federal loans—later extended to telephone companies in a 1949 amendment—for the purpose of installing electrical distribution grids in the rural United States. The Rural Electrification Administration, later renamed the Rural Utilities Service, oversaw the installations by over 400 rural electric cooperatives run by farmers and other local consumers, many of which still exist today. Many opposed this as one of the most alarming examples, in their eyes, of New Deal legislation that positioned the government as a competitor with the private sector; many lawsuits were filed, and the conservative coalition in Congress was invigorated by the perception of anti-business activities on the part of Franklin D. Roosevelt’s Democratic Party.

Further, the existing utility companies that had previously opted not to install electricity distribution in rural areas, or had done so only for punitive fees, often interfered with the work of the rural electric cooperatives, trying to prevent them from forming, or installing “spite lines” (power lines installed for the sake of staking a claim to an area, just to spite the cooperatives). Without such opposition, rural America would have been electrified more rapidly. But the gains were clear. By 1942, nearly half of American farms were electrified; by 1952, nearly all of them were.

The REA promoted electrical appliances to help rural customers make the best use of their electricity, as did other federal agencies. The Tennessee Valley Authority (TVA), a federally owned corporation created in 1933 to assist in specific areas of economic development in the Tennessee Valley, was one such agency. Walk-in coolers, for instance, were built by the TVA and made available for $650. They were refrigeration units big enough for ten families to use, not only for household use but also to store farm goods like meat, eggs, and dairy products before sale. This was an even bigger gain than it may at first appear to be: While modern Americans are generally aware of the existence of the pre-electric icebox, it was never as omnipresent in the American household as the electric refrigerator has become, and the cost of ice delivery was prohibitively expensive for many families, especially in hot climates.

The gains of electrification were not just economic; they significantly raised standards of living and increased leisure time without reducing productivity, while also freeing up more time for housewives and young family members who, once concerned principally with chores or housework, could now consider educational or social options, or work outside of the home. However, the flight of Americans from rural areas to urban and suburban ones continued, as did the decline of family farms in favor of large commercial operations.

Some areas of the United States remained unelectrified well into the twenty-first century. Notable are Native American reservations, which were excluded from the Rural Electrification Act. People living on tribal lands also often have poor cell and broadband service. Such issues were exacerbated by the COVID-19 pandemic, when for example schools closed and students were expected to use computers or tablets at home to keep up, but had no internet access or electricity to do so. One solution has been installation of solar and other renewable energy systems. However, such infrastructure is expensive. In 2022 the administration of President Joe Biden announced $35 million toward clean energy solutions on tribal lands.

Developing World

The basic issues facing the United States in the area of rural electrification in the 1930s are found throughout the world, but especially the developing world, where increased standards of living could rescue many from poverty. Further, climate control (air conditioning and heating), electric pump-driven wells (which reduce the spread of water-borne disease), and refrigeration are significant boons to public health, which is widely taken for granted in developed countries like the United States.

A 2009 estimate by the International Energy Agency stated that 83 percent of the 1.5 billion people worldwide without electricity live in rural areas. According to the IEA World Energy Outlook, which began tracking electricity access in 2012, the world's population had increased access to electrification until 2020, when the COVID-19 pandemic hampered efforts toward universal access to electricity, especially in sub-Saharan Africa. Initiatives to electrify rural areas exist in three of the rapidly developing “BRIC” (Brazil, Russia, India, and China) nations—India, China, and Brazil—as well as the European Union. Widespread need for electrification also exists in sub-Saharan Africa, including South Africa, and parts of the Middle East. In some parts of the world the number of people without electricity has continued to grow due to higher population growth rates in rural areas.

One of the concerns with rural electrification efforts is that when developing countries have no assistance or are provided with no motive to make other choices, their electrification efforts will naturally gravitate toward the cheapest solutions, which are also the most highly polluting. While renewable energy can theoretically be made cheaply available, only recently has serious work gone into developing renewable energy technologies for markets other than commercial niches and well-off Westerners. In the early twenty-first century, small solar energy systems became more widely available; in India and Bangladesh they are distributed by Grameen Shakti, and financed with a microfinance system.

While diesel generators are popular throughout the rural world, they are not only noisy, dirty, and inefficient, they require fuel, which can be expensive and in some cases may be difficult to find. On the other hand, they provide more power than solar energy systems usually do; the solar energy systems distributed by Grameen provide only enough power for lighting and small appliances, not enough to electrify a whole house or run most small businesses.

Planning

Important considerations in rural electrification initiatives include creating or acquiring sound statistical data on the populations to be served. While the REA had decades of census work to rely on, this is rarely the case in the parts of the developing world most in need of electrification today, and resource allocation, end-use considerations, and funding depend on having a clear idea of the demographics, geographical distribution, and energy needs of the population. Initiatives also need to be independent from political agendas and entities that could divert resources, either to other purposes or nepotistically.

The establishment of a strong infrastructure is required in order to make electrification “stick,” which is one problem with generators and other portable systems: A permanent grid supported by investors is one for which there is a profit motive for repair if something goes wrong in the future after the initiative’s work is complete. Stand-alone systems, though, are in turn immune to grid-related problems, and are a faster route to electrification in circumstances where serious infrastructure work is needed in order to build and maintain a grid—the equivalent of feeding people meals while helping them plant their gardens. Key to attracting the investment and ongoing support of the private sector is the creation of electricity customers, though this is an area where some initiatives face criticism for failing to understand or internalize the effects of severe poverty on the consumption potential of the population.

The most common end use of rural electrification is light, followed by television and radio. While they may at first seem like luxuries, TV and radio provide valuable information in rural areas in the developing world, in addition to entertainment. Even so, the popularity of television is sometimes highlighted as a symptom of a problem with rural electrification initiatives that concern themselves mainly with infrastructure and not with end use. The situation faced by such initiatives differs relevantly from the 1930s Rural Electrification Administration’s: While a gap between haves and have-nots existed in the 1930s, the post–World War II boom in labor-saving devices and the late twentieth century boom in microchip-driven consumer technologies have made the gap much bigger and more complicated. The world of the 1930s “haves” was one in which some things were electrified and most things weren’t; that of the twenty-first century is one in which a typical living room may contain a dozen different electrical devices and appliances, with more in the average person’s pocket or purse. It is often things such as televisions, DVD players, and music players that drive much of the demand for electricity in the developing world, where people are accustomed to a work life without electricity but have no nonelectrical alternatives to television and recorded music. More frequently individuals and small businesses rely on smartphones, which require some means of charging.

According to the World Bank, 99 percent of India’s population had access to electricity in 2020. Legislation has compelled the installation of biomass-powered generators in villages under arrangements whereby the cost, billing system, and fuel source can be controlled by village leadership according to what is the most sensible and desirable for the community.

In 2012 the government of Namibia announced a five-year plan to electrify all rural schools. Rural electrification has been a concern of Namibia’s since becoming independent of South Africa, but the new plan interrupted the broad-based electrification plan—which included household electrification—to focus on the largest priorities: schools, government buildings, and public institutions such as hospitals. The government promised that household, farm, and business electrification would resume in 2018 after the completion of the plan. However, electrification of schools was not yet completed. For example, schools in the Zambezi region did not get electricity until 2019, when a solar power system was completed. As of 2020 fewer than 37 percent of rural Namibians had electricity.

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