Is more use of electricity leading to less carbon emission growth? An analysis with a panel threshold model

Abstract

Electricity plays a key role in modern energy service and climate mitigation. Electricity is becoming more accessible and it is substituted for fossil fuel in more scenarios. Generating electricity from clean energy instead of traditional coal and improving the efficiency of electricity generation, transmission, distribution, and utilization are making it possible for a carbon emission growth reduction. Here we explored the question of whether more use of electricity will lead to less carbon emission growth. Firstly, based on the panel data of 114 countries from 2000 to 2014, we applied a STIRPAT model and then analyzed the relationship between carbon emission and electricity use level with fixed effects panel model and adopted a panel threshold regression model considering electricity-generating source heterogeneity. The results show that electricity use level has a significant negative effect on carbon emission especially when clean energy-based electricity takes a bigger portion. Population, economic growth, urbanization, and industrialization have significant positive impacts on carbon emission. We came up with policy implications based on the results in the end.