Sustainable development through clean energy: The role of mineral resources in promoting access to clean electricity

Natural resources and energy security of utility policy are crucial to attaining the sustainable development goal of access to affordable and clean electricity for all, particularly in developing and emerging countries. This study examines the relationship between renewable electricity output, financial development, clean fuel, and technology access, GDP, R&D expenditures, and electricity access in low- and middle-income economies from 2000 to 2021. It also investigates the impact of natural resources on economic expansion in the same group from 1973 to 2022. Using time series analysis and Granger causality, we find that a 1% increase in GDP and financial development leads to an average increase of 0.15% and 0.14% in electricity access. These effects remain significant even after accounting for break years. Additionally, renewable electricity output and access to clean fuels and technologies positively and significantly contribute to electricity access. Energy efficiency also plays a role in enhancing access to electricity in these economies. Moreover, natural resource rents show an asymmetric influence on economic expansion, initially insignificant but becoming significant over time. However, this impact remains asymmetric throughout economic expansion in low- and middle-income economies. Our study reveals an uni-directional linkage between energy efficiency, GDP, and electricity access. Conversely, financial development, access to clean fuels and technologies, renewable electricity output, and R&D expenditures demonstrate a bi-directional linkage with electricity access in these economies. Total natural resource rents, forest rents, and oil rents exhibit a bi-directional causality relationship with GDP, while mineral rents, coal rents, and natural gas rents have an uni-directional causality connection. These findings highlight the importance of renewable energy, financial development, and energy efficiency in promoting electricity access and provide valuable policy implications for fostering economic growth in low- and middle-income economies.