Green by Necessity? Rethinking Environmental Intent in Entrepreneurship Theory through Nigeria's CNG Transition
This paper introduces the concept of "economically compelled green adaptation" to explain how Nigeria's ride-hailing sector transitioned to compressed natural gas (CNG) following fuel subsidy removal, arguing that existing green entrepreneurship and technology adoption theories fail to account for environmentally beneficial outcomes driven solely by economic necessity rather than intentional environmental concern.
Original paper licensed under CC BY 4.0 (https://creativecommons.org/licenses/by/4.0/). This is an AI-generated explanation of the paper below. It is not written or endorsed by the authors. For technical accuracy, refer to the original paper. Read full disclaimer
In the study of how new businesses are born and grow, researchers have long held a specific idea about "green" entrepreneurship. The prevailing belief is that for a company to be considered environmentally friendly, the person starting it must have a conscious desire to save the planet. In this traditional view, the founder sees an environmental problem, decides to solve it, and builds a business that happens to make money while doing so. This focus on intention has helped scholars understand how people spot opportunities to create value for both nature and commerce. However, this lens leaves a large gap in our understanding. It cannot explain what happens when a business owner is forced to change their technology not because they want to help the environment, but because their current way of working is about to bankrupt them. When survival is the only goal, the path taken might accidentally lead to a cleaner world, even if the driver never thought about the environment at all.
This gap is the focus of a new perspective by researchers Seun Oladele and Germinah Evelyn Chiloane-Tsoka from the University of South Africa. They look at a real-world event in Nigeria to understand how economic pressure can create environmental benefits without any green intent. In 2023, the Nigerian government removed a long-standing subsidy on petrol. The price of fuel jumped dramatically, rising from roughly 175 naira to over 870 naira per litre. For the thousands of independent drivers who rely on ride-hailing apps to make a living, this was a crisis. Their daily earnings were being swallowed by the cost of gas, threatening to put them out of business entirely. Faced with this economic shock, these drivers did not sit down to debate the merits of climate change. Instead, they looked for a way to keep their vehicles running and their families fed.
The solution they found was to convert their petrol cars to run on compressed natural gas, or CNG. This transition happened on a massive scale, driven by a mix of a government program and a rapid, informal network of private workshops and local lenders. The researchers observed that while the government framed this shift as part of a national environmental strategy, the drivers themselves were motivated by something much simpler: cost. By switching to natural gas, these entrepreneurs could cut their weekly fuel expenses by between 40 and 65 percent. The result was a cleaner environment with fewer emissions, but this was a side effect, not the goal. The drivers were not trying to be green; they were trying to stay in business.
The authors argue that existing theories of technology adoption cannot fully explain this situation. Standard models usually assume that people choose a new technology because it is better, easier, or more useful than the old one, and that they have a free choice to stick with the old way if they prefer. But in this case, the old way was no longer a choice; it was an economic dead end. The researchers propose a new concept called "economically compelled green adaptation." This describes a situation where an entrepreneur switches to a lower-emission technology solely to survive an economic threat, with the environmental benefit emerging as an unintended consequence. The decision is driven by the need to preserve the business, not by a desire to protect nature.
To understand how this switch happens, the researchers used a framework originally designed to explain why people migrate from one place to another, known as the push-pull-mooring model. In this context, the "push" is the economic shock, like the sudden removal of the fuel subsidy, which forces the driver to leave their current situation. The "pull" is the attractiveness of the new option, which in this case is the promise of much lower operating costs and reliable fuel availability. However, the decision is not made in a vacuum. The researchers found that "moorings," or the conditions that hold a person in place or help them move, play a critical role. These include the availability of conversion workshops, the high upfront cost of changing the engine, access to loans, and the influence of friends and neighbors who have already made the switch.
The study highlights that even when the economic pressure is high and the new technology looks attractive, not everyone switches. The ability to actually make the change depends on whether the driver feels it is feasible. In Nigeria, the cost to convert a car ranged from 900,000 to 1.6 million naira, a sum that was out of reach for many without help. Because formal banks were often unwilling to lend for this purpose, drivers relied on informal finance and peer networks to get the job done. Those who had access to these resources and the necessary infrastructure were able to switch, while others remained stuck with expensive petrol. This shows that the path to a greener outcome is often blocked or opened by local conditions and social connections, not just by the price of fuel.
Once a driver makes the initial switch, the story does not end. The researchers found that turning a one-time decision into a lasting change requires learning. Drivers had to figure out new routines for refueling, understand how their vehicles performed on natural gas, and adjust their maintenance schedules. Through this process of trial and error, they learned how to make the new system work for them. This experiential learning transformed a reluctant, forced change into a stable part of their daily business. The environmental benefit persisted not because the drivers suddenly became environmentalists, but because the cleaner technology proved to be the most durable and profitable way to run their business over time.
The paper suggests that this phenomenon of "economically compelled green adaptation" is a distinct pathway to sustainability that has been largely overlooked. It challenges the idea that environmental progress always requires a conscious desire to help the planet. Instead, it shows that under the right conditions, the desperate need to survive can lead to significant environmental improvements. The researchers caution that this does not mean environmental motivation is unimportant, but rather that it is not the only way change happens. They also note that this specific type of adaptation relies on the existence of a viable alternative and the ability of the entrepreneur to choose it; if a switch is forced by law or if no better option exists, the dynamic is different.
Ultimately, the study offers a new way for policymakers and business leaders to think about encouraging green transitions. It suggests that simply making cleaner technologies attractive is not enough. If the path to switching is blocked by high costs, a lack of infrastructure, or a shortage of financing, entrepreneurs will not make the move, no matter how much money they could save. To support these transitions, especially in places with limited resources, efforts must focus on making the switch feasible. This means building more conversion centers, creating accessible loan programs, and fostering networks where drivers can learn from one another. By addressing these practical barriers, it may be possible to harness the powerful force of economic necessity to drive the kind of environmental change that voluntary efforts alone have struggled to achieve.
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