Abstract
This paper investigates the impact of GDP, renewable energy consumption, patents, and innovation on carbon intensity in Saudi Arabia. For this purpose, we use panel data from 1990 to 2019 and applied pooled OLS with fixed effect and quantile regression techniques to check the long-run association between variables. The results show that GDP is enhancing carbon intensity in Saudi Arabia. However, renewable energy consumption is a significant factor in reducing carbon emission. Further, it is also confirmed that patents and innovation can help reduce carbon intensity in Saudi Arabia. These results are also confirmed through quantile regression analysis. Our results are robust to alternative tests as well. Capital subsidies and feed-in-trade are important policy implications to promote the use of renewable energy.
Highlights
Carbon intensity means the amount of carbon emitted by using per unit of energy
This study investigates the impact of economic growth, renewable energy consumption, patents, and innovation on carbon intensity for Saudi Arabia
It can be seen that the highest mean value corresponds to carbon intensity, whereas the lowest mean value is for innovation
Summary
It is a fact that the majority of the carbon in the atmosphere is the result of the high amount of fossil fuel consumption, including oil. For a country like Saudi Arabia, whose economy is heavily deepened on fossil fuels (Tlili, 2015), the significance of low carbon intensity is highlighted. All sectors of the Saudi economy use oil and petroleum products for energy, making carbon intensity extremely high (Fatima et al, 2021). It can be seen that significant efforts to reduce carbon intensity has been taken, it is still very high. This situation calls for immediate attention to identify ways to reduce carbon intensity
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