Investigating the effects of natural gas, nuclear energy, and democracy on environmental footprint and energy risk in France: Does financial inclusion matter?

Abstract

To alleviate their energy poverty, most European nations, including France, import the bulk of their oil, natural gas, and coal needs, damaging the environment. The government has expanded its nuclear energy industry to lessen its reliance on imported fossil fuels and for energy security. The current investigation analysis the influence of natural gas, nuclear energy, democracy, and financial inclusion on carbon footprint and energy security from 2000Q1 to 2018Q4. The results of the Bounds test demonstrate that there are long-term interactions between the variables studied. Based on the estimates of the Auto Regressive Distributed Lag (ARDL) model results, nuclear energy, natural gas, and financial inclusion contribute to environmental degradation by increasing the carbon footprint. However, democracy has a role in mitigating long and short-term emissions. Nuclear energy and democracy, on the other hand, help to reduce energy risks while increasing energy costs. The outcomes of the Competition Competence Reports (CCR) test show that all findings are robust and consistent. Moreover, the study results confirmed the existence of the U-shaped EKC hypothesis. The study provides significant policy suggestions that improve energy security and enhance environmental quality. The study suggests that policymakers should exploit the productive capabilities of nuclear energy so that it can achieve energy security. Moreover, it does not have to be at the expense of the quality of its environment. The policy maker should use natural gas as a bridge that accelerates the energy transition since natural gas is the least emitting fossil energy. Likewise, within the framework of democracy, associations and political parties must be encouraged to consider environmental sustainability in their political programs.