A team of co-authors led by Janosch Ondraczek of the University of Hamburg (and also including Jana Stöver, Jann Lay, and me) recently wrote and published a Lighting Africa Market Intelligence Note that uses detailed survey data from Kenya to estimate household expenditure on kerosene for lighting in Kenya (as well as a number of other key parameters about household energy and lighting use). The article is available for download here.
The data that were available for the analysis were from a few years back (2005/06), but they nonetheless provide a solid, data-based picture of expenditure. The numbers indicated that the median Kenyan household spent about 2% of income on kerosene for lighting. The expenditure numbers could be broken out by income quartile, and they indicated that the median expenditure in the lowest income quartile was about 3% of total income while the median for the top quartile was a little over 1%. These numbers are roughly consistent with findings from other studies, such as a long term analysis by Tsao and Waide from 2010 that indicate that societies over several centuries have consistently spent about 1% of GDP on lighting regardless of lighting technology and energy source (though certainly people get much higher levels of lighting service for their money when they convert to higher quality energy sources such as electricity).
The results do not change the economics of modern off-grid lighting; the payback for adoption of leading solar powered LED lighting systems and other similar technologies is compellingly short. What the data do, though, is counter claims that kerosene lighting commonly accounts for a very large fraction (e.g. greater than 10%) of household expenditure. There are almost certainly some outlier cases where households do spend a very high fraction on lighting, but the evidence from Kenya does not support the idea that this is the norm. We would be interested to know about evidence or other studies on this topic, of course.
Note: this another related article that may be of interest:Lay, J., Ondraczek, J., Stöver, J., 2012. Renewables in the energy transition: Evidence on solar home systems and lighting-fuel choice in Kenya. GIGA Working Papers, No. 198. Available online at <http://hdl.handle.net/10419/60108>.