Threshold effects of energy mix on environmental quality

This paper empirically examines the nexus between energy consumption and the environmental quality conditioned to the energy mix in sub-Saharan African countries over the period 1990–2016. Using the panel threshold regression developed by Hansen (Econometrica 68:575–603, 1999) including 22 countries, the environmental quality is measured by the CO2 emissions. Results show that there is a non-linear relationship between energy consumption and CO2 emissions, and two threshold values of energy mix were found (68.53% and 88.86%). Then, our findings argue that energy consumption increases CO2 emissions when the energy mix is below 68.53%. However, when the energy mix is above 88.86%, energy consumption leads to a significant reduction in CO2 emissions. In addition, Gross Domestic Product and trade openness increase CO2 emissions, while rural population growth has a negative effect on CO2 emissions. Therefore, to achieve their environmental quality objectives, Sub-Saharan African countries have to focus their energy policies on renewable energy sources.