BRICS’ Race to Clean Energy Risks Creating a New Energy Divide

What happens when the clean energy transition moves faster than infrastructure, affordability policies and social protection? New evidence from BRICS economies warns that the shift to renewable energy can carry short-term costs that fall hardest on people already struggling to secure reliable electricity.

A study published in Energies, titled "The Impact of Energy Transition on Energy Poverty in BRICS Nations: Evidence from Panel Approaches," examines the relationship between renewable-energy transition and energy poverty across the expanded BRICS grouping. The research covers Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates from 2000 to 2023, using World Bank data and multiple panel estimation methods.

According to the study, energy transition is negatively associated with electricity access, the study's proxy for energy poverty. In the baseline model, a 1% increase in the energy transition variable is linked to a 0.63% decrease in electricity access in BRICS economies. Robustness checks using dynamic ordinary least squares and fully modified least squares show similar declines of 0.52% and 0.69%, respectively.

It suggests that clean-energy expansion can widen access and reduce long-term costs, but only if it is supported by infrastructure, affordability measures, grid upgrades, and policies that protect poorer households. Without those safeguards, the transition risks becoming cleaner but less inclusive.

A just transition cannot run on renewables alone

Energy poverty is not simply a technical failure, but a development failure. The paper defines it as the lack of safe, affordable, and reliable access to modern energy services such as electricity and clean cooking fuels, with consequences for health, education, economic participation, and household welfare.

For BRICS economies, the stakes are unusually high. The bloc includes some of the world's largest energy consumers, fastest-growing urban populations, and most unequal access landscapes. It also includes economies at very different levels of income, infrastructure maturity, and institutional capacity. The study notes that BRICS countries face structural drivers of energy poverty, including rural–urban disparities, inadequate infrastructure, governance issues, energy efficiency challenges, geopolitical pressures, and reliance on fossil fuels.

This is why a renewable-energy target, by itself, is not a just-transition strategy. If renewable expansion raises tariffs, diverts public resources from grid extension, or fails to reach poor communities, it can worsen the electricity-access dimension of energy poverty even while improving the carbon profile of the power system.

The authors argue that the negative relationship may reflect high implementation costs, affordability constraints, inadequate infrastructure, and institutional inefficiencies that can temporarily limit access to modern energy services.

Growth, cities and jobs are straining the power equation

The research also challenges another common assumption: that economic growth and urbanization automatically reduce energy poverty. In the baseline results, urbanization and economic growth are negatively associated with electricity access. The authors interpret this as a sign that rapid urban expansion and economic growth may be outpacing energy infrastructure development in BRICS economies.

The finding speaks directly to the development pressures facing emerging economies. Cities are expanding, industries are demanding more power, and households are moving up the energy ladder. But if generation, transmission, distribution, and affordability policies do not keep pace, growth can deepen pressure on already stretched systems.

The study's quantile results add nuance. Urbanization and economic growth can improve energy access across parts of the distribution, but the effects vary. The quantile analysis finds that urbanization is positively associated with energy access across all quantiles, while economic growth is positively associated with access from the 0.10th to 0.80th quantiles. This means growth and urbanization are not inherently harmful. They can support electrification when they are backed by infrastructure and service delivery. The risk emerges when demand grows faster than systems can absorb.

The unemployment result is more complex. The baseline model finds unemployment negatively associated with access, suggesting links between labour-market vulnerability and energy deprivation. But robustness and quantile results show positive associations in some specifications, leading the authors to call for further investigation.

For policy, the broader point is energy access, jobs, urban planning, and growth cannot be managed in separate silos. A household without stable income is less able to absorb tariff increases. A fast-growing city without upgraded distribution networks will face reliability and affordability stress. A renewable rollout without labour-transition planning may leave communities exposed to both energy and employment shocks.

The real test is who can afford the transition

The study finds that energy transition has a significant negative relationship with electricity access across most quantiles, with stronger effects at lower quantiles. In plain terms, the groups or country contexts with weaker access appear more exposed to the adverse effects of transition.

Energy transition is not only about replacing fossil fuels with renewables. It is about deciding who pays upfront costs, who receives subsidies, who gets grid access first, who benefits from investment, and who is protected when tariffs rise. For BRICS governments, the policy implications are immediate. Renewable-energy expansion must be paired with electricity-access guarantees. That means targeted subsidies, lifeline tariffs, investment in grids and storage, decentralised renewable systems for underserved areas, and transparent regulation to prevent transition costs from being passed disproportionately to poor consumers.

The study recommends that BRICS policymakers balance energy transition with access by investing in infrastructure, renewable energy, energy efficiency, and smart grids. It also calls for energy affordability measures so that marginalized communities are not overlooked.

For higher-income and more industrialized BRICS economies, the authors recommend faster investment in technological innovation, smart grids, renewable-energy storage, and energy efficiency, while maintaining social protection to cushion vulnerable consumers from temporary tariff increases during decarbonization.

The study also notes that it uses electricity access as the proxy for energy poverty, even though energy poverty also includes affordability, reliability, energy quality, and clean cooking access. The authors explicitly caution that the findings should be interpreted as evidence on the electricity-access dimension, not the full multidimensional reality of energy poverty.