THE RELATIONSHIP BETWEEN RENEWABLE ENERGY USE AND ECONOMIC GROWTH FOR ENERGY IMPORTING EMERGING ECONOMIES

Abstract

This study examines the relationship between renewable energy use and economic growth for 16 energy-importing countries for the period 1990-2018. These economies have attracted attention in the last 29 years by increasing their use of renewable energy by 556.21%, their total GDP by 466.19% and their total energy imports by 388.96%. Therefore, in this study, the long-term relationship is investigated by using annual data of real GDP, real gross capital, labor, and renewable energy use for 16 energy-importing countries. Firstly, unit root tests are used to determine the stationarity of the series. Then, the cointegration relationship was tested with a heterogeneous panel cointegration test and the cointegration relationship was found. The study found that all of the variables examined had positive and statistically significant coefficients. Additionally, the error correction model used in the study indicated that there is unidirectional causality from economic growth to renewable energy use in both the short and long term. This supports the conservation hypothesis, which suggests that economic growth and renewable energy use are interdependent. Therefore, the study's results suggest that any policies aimed at reducing energy use in these countries will not harm economic growth.