Mohammed Alharithi
Abstract This paper investigates the role of government support in driving socio-economic benefits during renewable energy transitions, using Saudi Arabia’s Vision 2030 as a pivotal case study of a fossil-fuel-dependent economy. This study tests the central hypothesis that a bundled approach – integrating financial, regulatory, and localization policies – generates amplified outcomes compared to isolated interventions. Our analysis employs panel data from 42 renewable energy firms (2012–2024) using dynamic fixed-effects, system GMM, and Vector Autoregression (VAR) models to establish causal inference and trace temporal dynamics. The findings offer critical policy implications for designing state-led energy transitions, underscoring the necessity of policy bundling under a unified vision, the primacy of regulatory precision for equitable poverty reduction, and the importance of complementary measures for small and medium enterprises to ensure inclusive growth alongside localization mandates. Our results demonstrate that coordinated post-2016 policy implementation under Vision 2030 significantly enhanced socio-economic returns: financial support rapidly expanded renewable capacity and reduced fossil fuel imports; regulatory frameworks delivered the most significant and sustained reductions in energy poverty; and localization mandates spurred job creation, despite initially raising carbon costs. Furthermore, a crucial sequencing effect emerged, with financial stimuli yielding rapid but short-term gains, while regulatory and localization impacts developed more slowly yet produced more durable improvements in social welfare and labor markets.