Abstract
The deployment of renewable energy sources (RES) is considered to be an important objective for the energy sector in the European Union (EU). The EU Directive adapted in 2009 fixed mandatory national targets for the use of renewable energy in transport as well as for the share of RES in the gross final energy consumption. Contrary to previous studies, this paper does not examine the link between the RES and economic growth but rather focuses on real gross domestic product (GDP) and the implementation of national renewable energy targets. We employ panel data models for the case of the EU-28 countries covering the period between 2007 and 2017 that yield a low and positive relationship between the impact of GDP per capita and the share of RES in the final consumption. Our results show that there is a significant causality only from real GDP per capita to the share of renewable energy in final consumption, marking the potential of developed countries to consume more RES. We list some groups of countries according to these variables using a cluster analysis approach. Starting from the proposed panel data models, we constructed the scenarios for the 2020 for various shares of RES and different EU Member States. Overall, it appears that more attention should be attributed to policy proposals in which funding opportunities would be dependent on the achievements of national targets and economic benefits should be given to countries with very good performance in achieving high shares of renewable energy in their final energy consumption.
Highlights
One important global concern nowadays is related to the adverse effects of the climate change and to the belief that it should be stopped
Starting from the proposed panel data models, we constructed the scenarios for the 2020 for various shares of renewable energy sources (RES) and different European Union (EU) Member States. It appears that more attention should be attributed to policy proposals in which funding opportunities would be dependent on the achievements of national targets and economic benefits should be given to countries with very good performance in achieving high shares of renewable energy in their final energy consumption
Our empirical approach is based on two main methods: (i) different panel data models that contain a study of the causality in the panel, and (ii) cluster analysis aimed at unveiling the groups of countries grouped by their shares of renewable energy in the final consumption and their levels of economic development expressed by the gross domestic product (GDP) per capita
Summary
One important global concern nowadays is related to the adverse effects of the climate change and to the belief that it should be stopped. One of the solutions for this impending problem is the reduction of the emissions of greenhouse gases (GHG) that could be made by replacing the fossil fuels with renewable energy sources (RES) [1]. There are infinite sources of energy on Earth represented by the sun, wind, stream, and sea that could protect the environment and reduce the emissions of GHG. The EU emissions trading system (EU ETS) is an important tool for reducing the level of GHGs and it represents an important part of the EU’s policy for managing climate change. This system is applied in the EU countries, including United Kingdom, and in Norway, Liechtenstein, and Iceland
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