Rural energy poverty alleviation in OECD nations: An integrated analysis of renewable energy, green taxation, and the United Nations agenda 2030

Abstract

Energy poverty in the Organisation for Economic Co-operation and Development (OECD) countries is a complex issue that needs careful and targeted solutions. Tens of millions of households in OECD countries struggle to pay for enough electricity and heating to meet their basic needs. Thus, it is essential to make a detailed assessment of rural energy poverty with an integrated approach. In so doing, we first measure rural energy poverty composite index across 38 OECD countries and their 5 major partners from 2000 to 2021. We then explored the linear effect of renewable energy technologies on energy poverty alleviation. Moreover, the mediating effect of green taxes on rural energy poverty through renewable energy technologies was analysed. Finally, the fuzzy regression discontinuity (FRD) method is employed to address the endogeneity issue associated with the assignment of the 2030 United Nations (UN) Agenda and to identify treatment effects. The results show that rural energy poverty improves over time. However, significant spatiotemporal disparities in alleviation efforts are found across countries. The results of Method of Moment Quantile Regression (MMQR) approach reveal that renewable energy technologies can accelerate rural energy poverty mitigation in the sample countries. We find that green taxation is an important mediating channel through which the adoption of renewable energy technologies alleviates rural energy poverty. The results of the Fuzzy-RD show that the 2030 UN agenda was effective in increasing the likelihood of rural energy poverty mitigation. The results remain consistent after a battery of robustness tests. This study offers valuable insights that can aid policymakers in formulating robust public policies.