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This study aims to examine the effect of governance on the consumption of modern renewable energy in the East African Community (EAC), controlling for economic growth, trade openness and foreign direct investment (FDI).

The study relied on secondary data sourced from the World Development Indicators, World Governance Indicators and the International Energy Agency (IEA) for the EAC from 1996 to 2019. A panel Cross-Sectional Augmented Distributed Lag (CS-ARDL) model and second-generation panel data models were employed in the analysis.

The findings indicate that poor governance and inadequate FDI are significantly responsible for the low level of modern renewable energy consumption (MREC) in the EAC. On the other hand, trade openness significantly enhances MREC, while GDP per capita has no significant effect on MREC.

The consumption of modern renewable energy sources (excluding the traditional use of biomass) and its determinants, as most studies focus on renewable energy consumption as a whole. The study also employed the panel CS-ARDL model and second-generation panel data models.

The study aims to explore the validity of the modern renewable energy-environmental Kuznets curve (REKC) while considering the relevance of financial development in the consumption of modern renewable energy in East Africa Community (EAC). Modern renewable energy in this study includes all other forms of renewable energy except traditional use of biomass. The authors controlled for the effects of urbanization, governance, foreign direct investment (FDI) and trade openness.

Panel data of the five EAC countries of Burundi, Kenya, Rwanda, Tanzania and Uganda for the period 1996–2019 were used. The analysis relied on the use of the autoregressive distributed lag–pooled mean group (ARDL-PMG) model, and the data were sourced from the World Development Indicators (WDI), World Governance Indicators (WGI) and International Energy Agency (IEA).

The REKC hypothesis is supported for modern renewable energy consumption in the EAC region. Financial development positively and significantly affects modern renewable energy consumption, whereas urbanization, FDI and trade openness reduce modern renewable energy consumption. Governance is insignificant.

The concept of the REKC, although explored in other contexts such as aggregate renewable energy and in other regions, has not been used to explain the consumption of modern renewable energy in the EAC.

Modern renewable energy is crucial for environmental conservation, sustainable economic growth and energy security, especially in developing East African nations that heavily use traditional biomass. Thus, this study aims to examine urbanization and modern renewable energy consumption (MREC) in East African community (EAC) while controlling for gross domestic product (GDP), population growth, foreign direct investment (FDI), industrialization and trade openness (TOP).

This study considers a balanced panel of five EAC countries from 1996 to 2019. Long-run dynamic ordinary least squares (DOLS) and fully modified ordinary least squares estimations were used to ascertain the relationships while the vector error-correction model was used to ascertain the causal relationship.

Results show that urbanization, FDI, industrialization and TOP positively affect MREC. Whereas population growth and GDP reduce MREC, the effect for GDP is not that significant. The study also found a bidirectional causality between urbanization, FDI, TOP and MREC in the long run.

Investing in modern renewable energy facilities should be a top priority, particularly in cities with expanding populations. The governments of the EAC should endeavor to make MREC affordable among the urban population by creating income-generating activities in the urban centers and sensitizing the urban population to the benefits of using MREC. Also, the government may come up with policies that enhance the establishment of lower prices for modern renewable energy commodities so as to increase their affordability.

MREC is a new concept in the energy consumption literature. Much of the research focuses on renewable energy consumption including the use of traditional biomass which contributes to climate change negatively. Besides, the influence of factors such as urbanization has not been given significant attention. Yet urbanization is identified as a catalyst for MREC.

The adoption of solar energy by households is an important avenue of protecting the environment and enabling energy access in rural areas, especially in developing countries like Uganda, where energy access is low. Therefore, this study aims to investigate the factors that influence the households’ willingness to adopt solar photovoltaic (PV) energy and how soon the households are willing to adopt solar PV energy for business use in Uganda.

Heckman’s two-step selection model was used to determine the willingness and urgency of adopting solar PV energy for business use in selected districts in Eastern Uganda. The respondents were selected purposively at the household level at a given point in time.

Results show that sex, household head estimated income, mode of acquisition and repayment terms of solar technology positively influence both willingness and urgency to adopt solar energy for business use in households. However, financial disclosure only influences willingness to adopt solar. Then, age and energy need only significantly influence how soon the household is willing to adopt solar PV energy for business use.

This study’s findings essentially apply to the individual factors that determine the willingness and urgency to adopt solar PV energy for business use by households. Hence, further research is needed to understand the external and industrial factors which could strengthen the predictive potential of the elements in this study.

This study underscores the need for regulatory enforcement on the supply and usage of quality, reliable and affordable solar equipment which are suitable for business use. Also, the need to promote and finance the usage of solar PV as a green energy source for household businesses has been emphasized.

The study simultaneously examines the willingness and urgency to adopt solar PV energy for household business purposes using Heckman’s two-step selection model. This has hitherto remained unknown empirically.