Renewable Energy Consumption and Carbon Emissions in Sub-Saharan Africa. The Moderating Role of Institutional Quality

This paper empirically investigates the effect of renewable energy consumption, institutional quality, and their interaction on carbon emissions in the Sub-Saharan Africa region, while controlling for foreign direct investment, industrialization, and population growth. The study analyzed a balanced panel of 839 country-year observations from 24 countries covering the period 2000–2023. A fixed effects model was employed to examine the relationships and test the moderating role of institutional quality. Results indicated that renewable energy consumption had a significant negative relationship with carbon emissions, reinforcing its role in mitigating environmental degradation. Institutional quality also demonstrated a strong negative relationship with emissions, underscoring the role of governance in environmental performance. Importantly, the interaction between renewable energy and institutional quality further enhanced the negative effect on carbon emissions, indicating that the effectiveness of renewable energy initiatives is significantly enhanced in the presence of strong institutions. The findings of this study contribute to the growing empirical literature on the relationship between renewable energy consumption, institutional quality, and environmental sustainability in Sub-Saharan Africa. Moreover, they offer critical policy insights for governments, development partners, and energy stakeholders. Given the significant negative relationship between renewable energy consumption and carbon emissions, policymakers should intensify efforts to expand renewable energy infrastructure and adoption. The amplifying effect of institutional quality highlights the urgency of governance reforms to support enforcement, transparency, and accountability in energy transitions.