Abstract

The study aims at testing the proposition that howoutreach of financial institutions as well as the access toinformation about alternate sources of energy affect inclinationtowards energy substitutability, significantly or insignificantly.Furthermore, the study also tests a second hypothesis thatgovernment’s decision to associate income tax with level ofenergy consumption from electricity distribution companies willaffect agriculturalist’s inclination to comply for the process ofenergy substitutability. Important stimuli for energypreferences such as information regarding alternate sources ofenergy and installment costs of efficient photovoltaic energysystems on the farm are also incorporated. Generalized Methodof Moments was used to comprehensively establish therelationship between outreach of financial institutions as well asaccess to information about energy substitutability, upon theintent of farmers to switch towards other sources of energy. Theresults show that the policy to link energy consumption andincome tax can be a good policy tool to ensure that the ongoingprocess of energy substitutability is sustainable in the long term.A need for state sponsored micro finance schemes as well as theprovision of Amber & Green Subsidy, can create ease forfarmers in attaining photo voltaic energy systems to ensureenergy efficient solutions. Robust regression was used keeping inview the apprehension about the possible existence ofheteroscedasticity in cross sectional data. Furthermore it canalso be used in order to identify important observations.