Abstract
The Belt and Road Initiative (BRI) has promoted the deployment of renewable energy to achieve sustainability. It is essential to reveal the influence of renewable energy on low-carbon economic development. The share of renewable energy consumption (SREC) is taken as the core explanatory variable in this paper, and its impacts on carbon emission intensity (CEI) and economic growth are investigated from the spatial-temporal perspective. First, the panel Granger causality test is applied for revealing the causal links among SREC, CEI, and economic growth during 1999-2017. Then, this paper investigates the impacts of SREC on economic growth and CEI through rigorous econometric techniques. Based on the regression results, Shapley value decomposition is utilized to account for the cross-country inequalities of economic growth and CEI. The main findings are as follows: (1) There exist bidirectional Granger causalities between SREC, economic growth, and CEI, which shows there is a systematic link between the three variables. (2) All models demonstrate SREC negatively influences economic growth, indicating renewable energy deployment costs are urgent to be decreased with SREG increasing. Besides, capital investment and openness positively affect economic growth, but energy intensity has an opposite impact. (3) From the spatial heterogeneity perspective, the cross-country inequality in economic growth is primarily due to the regional inequality of capital investment, followed by energy intensity and SREC. By contrast, the impacts of labor and openness are negligible. (4) SREC has a negative effect on CEI. In addition, an inverted U-shaped nexus between economic growth and CEI is observed. Energy intensity positively affects CEI, while the impacts of urbanization and openness are insignificant. (5) From the spatial heterogeneity perspective, the cross-country CEI inequality is mostly caused by the inequality of energy intensity, followed by SREC, urbanization, and economic growth, while the contribution of the openness gap is little. This article provides important implications for low-carbon development in the BRI countries.
Highlights
Since the industrial revolution, economic growth has been accompanied by a large amount of fossil energy, which results in a large number of air pollutants and causes a variety of greenhouse gases
As the Belt and Road Initiative (BRI) countries have witnessed extensive renewable energy development and cooperation, this study aims to uncover whether renewable energy development can help achieve economic growth and CO2 intensity reduction simultaneously
(2) All models demonstrate the inverted U-shaped nexus between share of renewable energy consumption (SREC) and economic growth, indicating renewable energy deployment costs are urgent to be decreased with the increase in SREG
Summary
Economic growth has been accompanied by a large amount of fossil energy, which results in a large number of air pollutants and causes a variety of greenhouse gases. Global warming has become an important environmental issue affecting human well-being. Framework Convention on Climate Change (UNFCCC 1992), both developed and developing countries have obligations to reduce carbon emissions. Agreement issued by the Paris Climate Change Conference made arrangements for addressing global warming after 2020 (UNFCC 2015). The Paris Agreement aims to control the rise in global temperature lower than 2°C relative to the pre-industrial period. To curb global warming, improving energy structure and promoting energy transition towards a clean and low-carbon mode has increasingly become an international consensus. The global renewable energy consumption increased by 512 million tonnes oil equivalent during 2000-2018, of which the average annual growth rate is 14.47%
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