Renewable Energy Consumption in Africa: Evidence From a Bias Corrected Dynamic Panel

Abstract

Our study investigates the determinants of renewable energy consumption in Sub-Sahara Africa. We explore the driving factors of renewable energy consumption in the context of carbon intensity for 32 Sub-Saharan African countries from 1990 to 2015. Using carbon emission intensity to identify group-specific heterogeneity, we recognize carbon-efficient and least carbon-efficient countries in the region. By relying on the corrected least squares dummy variable estimator (LSDVC), we provide evidence on the driving factors of renewable energy consumption in Sub-Saharan Africa. Consequently, the findings point to varying degrees of impact on renewable energy consumption in the region. For instance, we observe advancement in technology, quality of governance, economic progress, biomass consumption, and climatic conditions influence renewable energy consumption. With a common occurrence across all groups, the implications indicate environmental, socio-economic, and climatic factors playing an important role in renewable energy consumption. The study further shows that urbanization and economic globalization depress efforts towards renewable energy consumption. Apart from these common factors, other controlling variables including; GDP per capita, environmental awareness, and biomass affect each group differently. We conclude that, policy implications can be drawn from common factors towards harmonization of clean energy markets and developing a policy mix that combines environmental, economic, and social factors in attaining the Sustainable Development Goals.