Can sustainable financing facilitate the energy justice transformation? Evidence from developing countries in Asia

The transformation of energy systems towards justice in developing countries has attracted widespread attention. However, empirical evidence on whether sustainable financing drives this transformation remains limited. This study innovatively explores the impact of sustainable financing on promoting just energy transitions, focusing on developing countries in Asia where sustainable financing is thriving and energy transition is advancing rapidly. Our research indicates that sustainable financing promotes energy justice transitions, particularly in regions with more advanced transitions and robust financial systems. We also find that improving governance quality and human capital enhances the positive impact of sustainable financing. Additionally, sustainable financing indirectly promotes energy justice transitions by fostering green innovations. These findings provide empirical evidence and practical implications for policymakers to promote just energy transitions in developing Asian countries.