Decarbonizing energy: Evaluating fossil fuel displacement by renewables in OECD countries

Abstract

AbstractEnergy transition to greener systems has been a focal point in climate policy agendas across countries as the negative environmental impacts of fossil fuel technologies have become more evident Displacing fossil fuels with clean energy alternatives in this regard is essential for meeting global climate objectives. In this context, the study analyzes the role of disaggregated renewable energy sources on fossil fuel displacement in 36 Organisation for Economic Cooperation and Development (OECD) countries in the period 2000–2020. The findings demonstrate a discernible trend in the displacement of fossil fuels by various forms of renewable energy sources. It is found that to effectively displace 1% of fossil fuels, it is necessary to achieve an average increase of 1.15% in renewable generation capacity. In addition, a one-to-one displacement of fossil fuels occurs with hydropower, demonstrating its higher level of competitiveness and effectiveness in displacing fossil fuels. Moreover, there is a partial displacement of fossil fuels by solar and wind power. These findings suggest that renewable energy sources are progressively advancing towards effectively displacing fossil fuels.