Renewable Energy and CO2 Emissions in Top Natural Resource Rents Depending Countries: The Role of Governance

Paweł Jamroz,Bekhzod Djalilov,Raufhon Salahodjaev,Agnieszka Majewska,Beata Szetela

doi:10.3389/fenrg.2022.872941

Paweł Jamroz, Bekhzod Djalilov + Show 3 more

Open Access

https://doi.org/10.3389/fenrg.2022.872941

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Abstract

This study analyzes the relationship between renewable energy and CO2 emissions in top natural resource depending countries over the period 2000–2015. An important contribution of this study is to assess the role of governance. The Ordinary Least Squares Fixed effects Generalized Least Squares methods and two-step GMM estimators are used for panel data. The empirical results show that renewable energy has significant negative impact on per capita CO2 emissions. The estimates show that 1 percentage point increase in renewable energy consumption leads to 1.25% decrease in CO2 emissions per capita. We also find that renewable energy consumption decreases CO2 emissions faster in countries with higher rule of law and voice and accountability. gross domestic product per capita has inverted U-shaped relationship with CO2 emissions.

Highlights

Over the past 2 decades, the research on the drivers of CO2 emissions has proliferated (Andreoni and Galmarini, 2016; Henriques and Borowiecki, 2017; Dong et al, 2020)
In order to examine the role of governance in RE and CO2 emissions we extend Eq 1 by including governance indicators (GI) interactively with RE
1 percentage point increase in renewable energy consumption leads to 1.25% decrease in CO2 emissions per capita

Summary

Introduction

Over the past 2 decades, the research on the drivers of CO2 emissions has proliferated (Andreoni and Galmarini, 2016; Henriques and Borowiecki, 2017; Dong et al, 2020). One of the main theories to explain the long-term trends in CO2 emissions across nations is the pioneering study by Grossman and Krueger (1991) who documents that there is non-linear (inverted U-shaped) relationship between gross domestic product (GDP) per capita and environmental outcomes such as SO2 emissions, the so-called Environmental Kuznets Curve (EKC) framework. The EKC theory has been validated in a number of review studies (Cavlovic et al, 2000; Sarkodie and Strezov, 2019). A number of review and empirical studies highlight that in the case of CO2 emissions there is no robust confirmation of the EKC hypothesis (Pao et al, 2011; Liu et al, 2017) and the turning point for GDP per capita may be far outside existing range of data (Koirala et al, 2011). The goal of this study is to explore the relationship between renewable energy and CO2 emissions. According to the resource curse theory, Renewable Energy and CO2 Emissions: The Role of Governance

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