Impact of green energy policy on sustainable environment in South Africa: an ARDL and Toda-Yamamoto approach

Abstract

This paper examines the long-run relationship and the direction of causality between green energy consumption and some environmental variables like deforestation, natural resource depletion, carbon dioxide emission, and non-renewable energy in South Africa from 1986 to 2015. In order to determine the long-run relationship or the sustainability level of adopting the green energy policies on the environment, the study utilised the autoregressive distributed lag bound testing approach to co-integration and the Toda-Yamamoto approach to check the direction of causalities among the variables. The study established a substitutability effect between green growth policies and the consumption of non-renewable energy. However, no evidence is found on the impact of green growth policies on the levels of deforestation and carbon dioxide (CO2) emissions, as well as natural resource depletion in South Africa. This study does not only make contributions to the literature on the relevance of green growth policies for achieving environmental sustainability especially insights from natural resource depletion and deforestation in South Africa. It also recommends that South Africa and other developing countries should adopt continued implementations of green growth policies as a panacea for achieving environmental sustainability.