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The quest for economic development has brought adverse effects on the environment through the release of greenhouse gases, such as carbon dioxide (CO₂₎. This will counter the efforts to achieve the Sustainable Development Goals (SDGs) by 2030. This study, therefore, investigates the effect of electricity consumption and urbanization on CO₂ emissions in Ghana. Electricity consumption and urbanization are among the factors that can be used to reduce CO₂ emissions.

Following the STIRPAT framework with the Hansen (2000) least squares threshold estimation strategy, the study employed annual time series data from 1971 to 2019.

The study revealed a single threshold effect of both electricity consumption and urbanization on CO₂ emissions. Electricity consumption intensity reduces CO₂ emission when electricity consumption is below the threshold (6287GWh) but increases when consumption passes the threshold. However, urbanization exerts a positive influence on CO₂ emissions regardless the level of urbanization (either before or after the threshold point). Again, the empirical results revealed that the urbanization threshold moderates the effect of electricity consumption on CO₂ emissions.

Policymakers have to consider redesigning the current urbanization mode to include some new-type urbanization elements.

The threshold effect of electricity consumption and urbanization on CO₂ emissions in Ghana is examined using the Hansen (2000) least square method.