Assessment of green investment impact on the energy efficiency gap of the national economy

Abstract

The paper deals with the analysis of the green investment impact on the energy efficiency gap. The findings of the bibliometric analysis proved the increasing trend of the published documents on green investment and the energy efficiency gap. In the study, the author used Scopus Tools Analysis, Web of Science Results Analysis, and VOSviewer for providing the bibliometric analysis. In the paper the author checked the hypothesis as follows: cointegration exists between GDP, energy efficiency, green investment and share of renewable energy; green investment had a positive impact on the percentage of renewable energy; green investment had a positive effect on the countries energy efficiency and decreased the energy efficiency gap. The author used the unit root test for checking the stationarity of the selected variables. Pedroni panel cointegration test used for monitoring the cointegration between variables. Fully Modified Least Square model used for identifying the relationship between variables. The findings proved the stationarity of the data at the first level. It allowed providing the Pedroni cointegration test and long-run covariance test. Thus, the empirical results showed that increasing green investment leads to an increase in energy efficiency by 0.56 points, gross domestic product per capita – 0.18 points, renewable energy – 0.39 points. The increasing of renewable energy allowed increasing energy efficiency by 0.38 points, gross domestic product per capita – 0.19 points, green investment – 0.54 points. Besides, rising of the countries’ energy efficiency allowed growing of gross domestic product per capita by 0.27 points, green investment – 0.31 points, and declining of renewable energy by 1.14 points. If the increase of energy efficiency leads to a decrease in the energy efficiency gap the following could be concluded: increasing green investment leads to reducing of energy efficiency gap; increasing of renewable energy in the total energy consumption allowed declining the energy efficiency gap. In this case, in Ukraine, the mechanisms for improving the investment climate should be developed at the national level, considering the EU experience. Such activities allowed to attract additional green investment in renewable energy projects. Keywords: green investment, cointegration, correlation, green finance.