The Australian National University Centre for Economic Policy

This paper presents evidence on a national-level electricity ladder which sees countries transition toward coal and natural gas, and finally nuclear power and modern renewables such as wind power, for their electricity needs as they develop. The extent to which countries climb the electricity ladder is dependent on energy endowments. The results imply that the environmental implications of economic development differ in countries with different energy resource endowments. An effective global carbon mitigation strategy will require developing countries to leapfrog the middle rungs of the electricity ladder.