Abstract:
Efficient use of renewable energy is critical for ensuring high economic
growth and competition. However, the adoption and use of renewable energy
alone may not be a sufficient means of ensuring environmental sustainability.
By utilising the system Generalised Method of Moments technique on a
balanced panel dataset of 26 sub-Saharan African countries from 2002 to
2016, the study investigated the effect of disaggregated energy consumption
and institutional quality on environmental quality. The results of this study
indicate that while non-renewable energy consumption degrades the
environment, renewable energy consumption enhances the quality of the
environment. The study also discovers that a lower tax burden and
improvement in government integrity lead to higher environmental quality
given the consumption of renewable energy. From the moderating effect of
energy consumption and institutional quality, more secured property rights and
improvement in government integrity significantly moderate the effect of non renewable energy consumption on environmental quality while a lower tax
burden moderates the effect of renewable energy consumption on
environmental quality. The study recommends that to reduce carbon-induced
emissions, governments and policymakers need to commit to renewable
energy development while implementing a flexible tax system, securing
property rights, and maintaining strong state integrity.
