The impact of energy poverty alleviation on the level of income inequality in Indonesia

This study examines how energy poverty alleviation shapes income inequality across 514 districts in Indonesia during 2010–2022. Rather than treating energy access as inherently equalizing, the study frames the energy–inequality nexus as capability-dependent and context-specific. The results show that access to clean cooking energy consistently reduces income inequality through immediate and broadly shared welfare gains. In contrast, electricity access is associated with higher inequality in the short to medium run, reflecting a transitional dynamic driven by unequal capabilities in utilizing energy productively. Interaction results indicate that education significantly weakens this effect, supporting a capability-driven convergence mechanism. Overall, the findings highlight that energy transitions are not automatically inclusive and require complementary investments in human capital to translate access into equitable outcomes.