Could the digital economy increase renewable energy and reduce carbon emissions? Empirical research on EKC in 67 countries.

Abstract

The digital economy isconsidered important to achieve carbon peaking and carbon neutrality. This paper explores the impact of the digital economy on carbon emissions and renewable energy development using panel data for 67 countriesfrom 2005-2019. The results show that there is an inverted U-shaped relationship between the digital economy and carbon emissions, which is consistent with the Environmental Kuznets Curve (EKC) hypothesis, and a U-shaped relationship with renewable energy consumption, which is consistent with the Renewable energy Kuznets Curve (RKC) hypothesis. Compared with gross domestic product (GDP), the digital economy is more likely to accelerate the process of energy transition and carbon reduction, which is a key factor for carbon peaking. In addition, it is also found that the turning point of the RKC precedes the EKC, which means that the RKC reaching its turning point is a prerequisite for the corresponding EKC to reach its peak.Therefore, the digital economy should be accelerated to push RKC to cross the turning point as soon as possible, thereby accelerating EKC to cross the turning point.