Regional convergence of nonrenewable energy consumption in Vietnam

Abstract

Over the past few decades, energy demand in Vietnam has increased dramatically to fuel one of the most rapidly growing economies in the world. It is therefore crucial for Vietnam's policymakers to develop a comprehensive energy strategy that ensures equality among its diverse regions, reduces the use of fossil fuels and mitigates carbon footprint. In this article, we examine the intensity of four major types of fossil-fuel energy consumed across 64 Vietnamese provinces to shed light on (1) the disparities in energy consumption and their determinants and (2) whether a shift to less-polluting energy sources has occurred over time. To this end, we employ a novel nonparametric approach that overcomes the limitations of the conventional convergence regression framework to study Vietnam's energy distribution dynamics. Our results support the formation of regional convergence clusters to a level lower than the national average consumption in the long run. We also show that, although the observed convergence pattern cannot be explained in isolation by the spatial differences in income or the magnitude of agricultural and export activities, these factors should be taken into account when sustainable energy and environmental protection policies are formulated.