Abstract
African nations encounter difficulties enforcing regulations and providing incentives for using renewable energy sources. However, several nations are making efforts to encourage renewable energy through financial and tax advantages. Therefore, a shift to renewable energy is essential for African nations to experience sustainable growth and lessen environmental deterioration. Similarly, the extant literature examining green taxes’ influence on renewable energy technology has documented equivocal findings. Hence, there is a need for a more thorough investigation. This study, therefore, explores the influence of green taxation on renewable energy technologies of emerging countries in Sub-Saharan Africa. We employed data from a sample of 28 countries of 54 African countries spanning 21 years from 2001 to 2021, providing a panel of 588 country-year observations. The Organisation for Economic Co-operation and Development (OECD) and the World Bank Dataset provided all the study’s data. A heterogeneous dynamic panel data modelling using the autoregressive distributed lag (ARDL) has been adopted. The study found that green taxes might be used to mitigate the adverse effects of non-renewable energy activities on the environment in Africa. Considering the findings of the components of green taxes, it was recognised that an increase in energy-related tariffs would lead to a growth in Africa’s use of renewable energy. It was further established that an increase in transport taxes increases the adoption of renewable energy technologies in Africa. A comparative analysis between the commonwealth and non-commonwealth countries showed that green taxes of commonwealth countries in Africa significantly contribute to the growth of renewable energy technologies compared to non-commonwealth countries in Africa. Primarily, the results of this study can be a valuable resource for African governments and policymakers as they develop policies and evaluate legislation about the usage of renewable energy sources and other green practices. Finally, the study can shed light on creating and using efficient tax laws that support renewable energy sources.
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Source: OECD data https://www.compareyourcountry.org/environmental−taxe
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Bala, H., Khatoon, G. Effect of green taxation on renewable energy technologies: an analysis of commonwealth and non-commonwealth countries in Sub-Saharan Africa. Environ Sci Pollut Res 31, 11933–11949 (2024). https://doi.org/10.1007/s11356-024-31879-0
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DOI: https://doi.org/10.1007/s11356-024-31879-0