Do natural resources ensure access to sustainable renewable energy in developing economies? The role of mineral resources in a resources-energy novel setting

Abstract

Natural resource rents offer both opportunities and challenges. Effectively harnessing these rents while mitigating the associated risks is crucial for promoting sustainable economic development, environmental conservation, and social welfare in these nations. This study highlights the role of natural resource rents, economic activity, and energy efficiency on renewable electricity output in case of BRICS countries from 1988 to 2021. Investigating the nexus between resources' rents on renewable electricity output in BRICS countries is crucial because each of the BRICS countries has unique energy profiles and large natural resource reserves. The significant results of the Westerlund cointegration test provide strong evidence of a long-term association amongst natural resource rents, GDP, energy efficiency, and renewable electricity output in the BRICS countries. This finding highlights the importance of understanding and considering the long-term dynamics and interdependencies among these variables when formulating policies and strategies for sustainable energy development. The estimates of the quantile regression approach suggest that coal rents and mineral rents negatively affect renewable electricity output. On the contrary, energy efficiency, forest rents, oil rents, and GDP positively affect renewable electricity output. The findings underscore the need for tailored policies by addressing each country's key challenges and opportunities. By leveraging natural resource rents, promoting sustainable economic growth, and enhancing energy efficiency, BRICS countries can accelerate their transition to a more sustainable and renewable-based energy system, contributing to global climate change mitigation efforts.