Abstract
This paper examines the effects of age dependency ratio (the young age, old-age and overall age) and urbanization on renewable and non-renewable energy consumption in Brazil, India, China, and South Africa, considering the panel data from 1990 to 2019. We control economic growth and foreign direct investment inflows as key factors in the energy demand function using the Stochastic Impacts by Regression on Population, Affluence and Technology approach. Empirical analysis has been implemented using the Kernel Regularized Least Squares machine learning method to solve possible classification problems in the traditional regressions without relying on the linearity assumption. It is observed that the young age dependency, overall age dependency, and urbanization negatively affect both renewable and non-renewable energy demand. On the contrary, old-age dependency and economic growth are positively associated with renewable and non-renewable energy demand. The mixed effects of foreign direct investment inflows on renewable and non-renewable energy demand patterns are also found. Thus, the findings suggest that environment policymakers in the BRICS economies should prioritize urbanization, young age, and overall age population to improve energy efficiency.
Highlights
Since the early 1990s, renewable energy consumption and production have risen in developing and developed economies (British Petroleum, 2020)
This study showed that the old age population has an increasing role in energy demand People in the 35–49 age cohort have negative, whereas people in the 50–64 age cohort positively affect energy demand and the positive role of urbanization The inverted U-shaped relationship shows positive and negative relationships after the inflection point, 18–23% of the elderly over the working age Review establishes the positive role of urbanization on energy use; higher population density is lower energy demand Population density harms energy consumption, whereas industrial output has a significant positive impact on energy consumption The middle age group, the working-age group, is the most significant contributor to residential energy demand Household size has a significant impact on energy consumption; residential energy consumption increases with the life course
We find that the young age dependency, overall age dependency, and urbanization negatively affect renewable and non-renewable energy demand
Summary
Since the early 1990s, renewable energy consumption and production have risen in developing and developed economies (British Petroleum, 2020). The rise of renewable energy may have four important issues. The first issue is the potential problems of climate change and renewable energy usage in decreasing CO2 emissions. Renewable energy can mitigate the adverse effects of climate change on economic performance (Payne, 2009). The second issue is technological progress and declining investment costs on renewable energy facilities (Apergis and Payne, 2010). There are rising production standards in renewable energy facilities (Apergis and Payne, 2012). The volatility and rise in crude oil prices have promoted renewable energy consumption (Gozgor, 2018a).
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