Impact of Energy Transformation on Economic Productivity and Environmental Sustainability in Toba-Asahan, Indonesia

Abstract

This study explores the influence of energy transformation on economic productivity and environmental sustainability in the Toba-Asahan region. The focus is on how renewable energy impacts community productivity, addressing a critical research gap in the literature. While energy transitions have been widely studied in other regions, specific research on their effects in Toba-Asahan remains limited. This study uniquely explores how human resources mediate the impact of renewable energy on community productivity in Toba-Asahan, shifting focus from environmental effects to economic productivity in a region previously under-researched in energy transformation studies. Using Structural Equation Modeling (SEM) based on data collected from 230 respondents, this research analyses the relationship between human resources, energy utilization, and productivity. The findings reveal that human resources have a significant positive impact on both energy utilization and productivity. However, the direct effect of energy on productivity is found to be statistically insignificant. The study concludes that enhancing human capital and increasing community awareness of renewable energy’s benefits are essential for maximizing productivity and achieving sustainable economic growth in the Toba-Asahan region.