Race and energy poverty: The moderating role of subsidies in South Africa

Although energy poverty has recently gained wider attention, fewer efforts have been made to understand the race-energy poverty nexus, especially for developing economies. To contribute to the literature, our study an-alyzes the effect of race on multidimensional energy poverty while accounting for the moderating role of sub-sidies by utilizing the South African General Household Survey. The estimates show that Non-Whites, predominately Blacks are susceptible to energy poverty and experience about 11.5% energy poverty prevalence than their White counterparts. The result is consistent when other robust methods are applied. This difference is attributed to the level of discrimination Non-Whites face, as confirmed by the Oaxaca-Blinder decomposition analysis. The decomposition analysis further showed that compensating Non-Whites would reduce their energy poverty prevalence by 17%. More so, the moderation analysis shows that the free basic electricity and social housing subsidies received by Non-Whites are generally ineffective in reducing their energy deprivation. Therefore, we urge policymakers to put measures in place to end the discrimination that comes with the allo-cation of subsidies, to facilitate the adoption of clean energy services among Non-Whites and eradicate energy poverty.