Pricing the future: unveiling the effects of carbon pricing on socio-economic outcomes and energy poverty

Abstract

The systematic review used PRISMA guidelines to examine the impact of carbon pricing mechanisms on energy poverty and socio-economic outcomes. Furthermore, Scopus and Web of Science databases were searched for articles published between 1984 and 2023. Nine key themes emerge, including sustainable urban development, renewable energy transition, and governance challenges in energy distribution. The findings underscore the implications of the mechanisms for energy security and socio-economic aspects in developing nations. These mechanisms span multiple SDGs, including SDGs 1, 2, 4, 7, and 11. These findings have several implications, among others, (i) Strategically allocating carbon pricing revenue, e.g. targeted social programmes or investments in renewable energy, can counteract adverse effects and contribute to social equity. (ii) revenue from energy-related policies can be leveraged to alleviate energy poverty through rural electrification and infrastructural development. This study contributes insights for policymakers and practitioners emphasising the interconnectedness of environmental policies with broader development objectives.