A major challenge facing developing countries is how to allocate scarce capital, especially public capital, for the provision of basic services. Electrification, as part of an integrated service delivery package, is both a large draw on public funds and also an important catalyst for economic development. One of the major benefits of electrification, but one that is not included in traditional cost-benefit analysis, is the avoided health costs of fuels such as wood, coal and paraffin. March 2005