Examining the Determinants of Renewable Energy Consumption in the Southern African Power Pool

Abstract

The main factors influencing the Southern African Power Pool’s (SAPP) usage of renewable energy are examined in this article. The 12 nations that constitute the SAPP are the sources of the data from 1988 to 2018. The effect of GDP, gross fixed capital formation, labour, trade, and non-renewable energy on renewable energy in SAPP is estimated using the panel ARDL method. The empirical findings suggest that, in the long run, all coefficients of explanatory variables have positive signs, except for gross fixed capital formation and non-renewable energy, which have negative signs. Furthermore, all results were statistically significant at one to five percent. This implies that the reduction in renewable energy in the SAPP is caused by non-renewable energy and gross fixed capital formation in the long run, but not by any other explanatory variable. The results also showed that each SAPP member country’s impact on renewable energy was varied. The SAPP could, therefore, encourage the adoption of renewable energy sources through the results presented in this report. Based on these findings, the study suggests that economic policies that hasten economic development and growth will increase renewable energy consumption.