Striding towards a greener future: Unlocking the potential of natural resources and employment dynamics in green energy transition in sub-Saharan Africa

Abstract

The adoption and utilization of renewable energy offer potential benefits such as enhanced energy efficiency, cost savings, and ecological advantages. However, a key research question addressed in this analysis is whether natural resource rent and employment dynamics influence renewable energy consumption in Africa. Previous research has predominantly focused on the aggregate employment rate, overlooking the nuances of labor diversity across sectors and employment types. Hence, this study evaluates the importance of natural resource rent and employment in driving the transition to green energy in sub-Saharan Africa from 1991 to 2022. It employs the innovative method of moments quantile regression (MMQR) model for this purpose. The findings reveal a positive connection between natural resource rent and the adoption of green energy. When considering employment types, the study observes that self-employment and wages/salaried workers undermine clean energy utilization. Moreover, the study highlights that employment across key economic sectors also plays a role. While employment in the agriculture and service sectors fosters green energy utilization, employment in the industrial sector impedes renewable energy consumption. To advance the development of green energy in Africa, this study underscores a range of policy options.