Determinants Of Renewable Energy Consumption Research Articles

Determinants of renewable energy consumption in agrarian Sub-Sahara African economies

The effect of ecological distortions and climate change issues have been at the forefront of the minds of policymakers and energy practitioners in recent decades. This concern is associated with the vision of the seventh and thirteenth Sustainable Development Goals that are centered on access to clean energy sources and mitigating climate change issues, as detailed in Vision 2030. To this end, the present study uses Pesaran’s Pooled Mean Group Auto Regressive Distributed Lag model to investigate the determinants of clean/non-conventional energy in the case of Sub-Saharan Africa. The empirical results show that a 1% increase in economic activity increases the level of renewable energy consumption by 0.128% in the short run. In the long-run, economic growth dampens the consumption of renewable energy by 0.402% over the investigated period. The reason for this peculiar result for the Sub-Saharan African economies could be attributed to the prevalent demand for conventional energy sources and the cost-related factor associated with clean energy technologies even when the economy (herein measured by Gross Domestic Product) is improving. Furthermore, the effect of energy (electricity from fossil fuel) also shows a statistically significant impact when trying to reduce the clean energy consumption. This arises from an expected trade-off effect. Regarding the causality analysis using the heterogeneous panel, the causality results present a one-way causality running from economic growth to renewable energy consumption. We also found there to be a feedback causality relationship between urbanization and renewable energy as well as agricultural value added and economic growth. Based on these findings, several policy decisions were prescribed for Sub-Saharan African economies such as the diversification of Sub-Saharan African economies energy to more renewable energy sources and the adoption of clean energy technologies that are reputed to be cleaner and environmentally friendly.

Can educational attainment promote renewable energy consumption? Evidence from heterogeneous panel models

PurposeFor mitigating climate change, renewable energy consumption is recognized as one of the policy measures worldwide. However, there is a dearth of empirical studies focusing on education as one of the determinants of renewable energy consumption in the existing literature. Thus, this study aims to explore the impact of education, economic growth and foreign direct investment, financial development, CO2 emissions and urbanization on renewable energy consumption.Design/methodology/approachThis study considers a balanced panel of selected South Asian Association of Regional Cooperation (SAARC) countries, namely, India, Pakistan, Sri Lanka, Nepal and Bangladesh, during the period 1995–2015. The study uses sophisticated second-generation panel data models for empirical analysis.FindingsThe result reveals that education and economic growth significantly enhance renewable energy consumption, whereas foreign direct investment, financial development, CO2 emissions and urbanization reduce it. Further, unidirectional causality from education, economic growth and urbanization to renewable energy consumption was observed, whereas a bidirectional causality was found between renewable energy consumption and financial development.Practical implicationsThe emanated finding of this study is supposed to be helpful for the environmentalists, economists, banking sector and the practitioners in urban development can take insights from the study while framing the energy policy.Originality/valueThis is the first study that examines the role of education on renewable energy consumption in heterogeneous panel data settings for the selected SAARC countries.

Analyzing the relationship between sustainable development indicators and renewable energy consumption

The transition to renewable energy sources remains a major challenge for developed and developing countries. Therefore, the study aims at investigating the relationship between sustainable development indicators and renewable energy consumption utilizing integrated data sets for 255 indicators expressing the sustainable development goals from 137 developed and developing countries. Principal component analysis then multiple linear regression tests are employed to conclude a mathematical model representing the numerical relationship between a set of sustainable development indicators and renewable energy consumption. The statistical analysis results include (i) an inverse correlation between Sustainable Development Index which expresses the dominant factor representing collected data and renewable energy consumption, (ii) a set of sustainable development indicators as the determinants of renewable energy consumption. The findings explain the rapid transformation of low Sustainable Development Index countries towards renewable energy technology by realizing the effective role of using renewable energy as a local solution. Moreover, the findings manifest the importance of the given sustainable development indicators in obtaining a more significant increase in renewable energy consumption. Using the concluded mathematical mode, planners and decision-makers can compromise the concluded indicators to attain a serious progressing step towards renewable energy transition aligned with achieving sustainable development.

Role of banking sector performance in renewable energy consumption

To secure future universal access to modern energy, large investments in renewable energy technology are required. This paper estimates the impact of five banking sector performance indicators (return on asset, market capitalisation, asset quality, managerial efficiency and financial stability) on renewable energy consumption for a global panel consisting of 124 countries. The study used two-step system-GMM panel model to handle potential endogeneity and serial correlation. The paper considers three homogenous subpanels which are constructed based on the income group classification (high-, middle-, and low-income countries). Generally, our results show that improved banking sector performance enhances renewable energy consumption, with heterogenous effect across income group classification. For high -income (HI) countries, an increase in bank size together with improved asset quality and managerial efficiency have positive effects on renewable energy consumption. For middle-income (MI) and low-income (LI) countries, a high return on asset, an increase in bank size and financial stability are positive determinants of renewable energy consumption. We also find heterogenous effect of banking performance indicators across various renewable energy consumption types. The results highlight the importance of a well-functioning bank sector to achieve the investment in renewable energy needed to meet future energy demand and simultaneous decrease CO2 emissions.

The role of party polarization in renewable energy consumption: Fresh evidence across the EU countries

The essential role of renewable energy in mitigating the negative consequences of climate change has led to a growing body of literature that has examined the determinants of renewable energy consumption. Most of the existing studies focused on the macroeconomic, environmental, institutional, and energy-related determinants of renewable energy consumption and neglected the potential role of partisan polarization. The adverse effects of party polarization have been well documented by the literature, but the impact of party polarization on renewable energy consumption has not been examined. To fill this existing gap, this study explicitly explores the association between renewable energy consumption and partisan polarization across 25 European Union countries, spanning the period 2003–2017. The findings document that party polarization is negatively associated with renewable energy consumption after accounting for an extensive set of macroeconomic, environmental, institutional, and energy-related determinants and the use of a different set of estimation methodologies. The paper's findings show another adverse effect of party polarization by demonstrating its negative impact on renewable energy consumption.

Determinants of renewable energy consumption: Importance of democratic institutions

There has been an increase in the use of renewable energy sources over recent years, which has led to a strand of literature examining the determinants of renewable energy consumption. However, most of the research used linear estimation models while reviewing the determinants of renewable energy consumption and ignored the indirect effect of democratic institutions on renewable energy consumption. With the use of a panel threshold model, this paper demonstrates that democratic institutions play a significant role in renewable energy consumption. In countries in which the democratic rights of people are preserved better, higher economic growth leads to increased use of renewable energy consumption; however, there is a negative association between economic growth and renewable energy consumption in less democratic countries. Increased trade openness leads to lower growth rates of renewable energy consumption in less democratic countries, while increases in real oil prices lead to increased renewable energy consumption in less democratic countries but play no significant role in more democratic countries. The findings of this paper suggest that democratic institutions are vital in channelling economic resources (economic growth) to renewable energy, and increased trade openness is associated with lower rates of renewable energy deployment in less democratic countries.

Determinants of Renewable Energy Consumption in Nigeria: A Toda Yamamoto Approach

Nigeria has inadequate power supply and this issue has lingered for years despite power sector reforms. Renewable resources could to be offering sustainable alternative energy supply in rural and urban regions of Nigeria. So, the key factors that determine the utilization of renewable energy in Nigeria are estimated in this paper for a period of twenty-four years using toda yamamoto method. Long-run relationship exists between renewable energy consumption and its determinants in Nigeria. Real income (real GDP) and emissions of CO2 are the most significant determinants of oil products import demand in Nigeria. Trade Openness was found to be insignificant. The analysis showed no causality between the consumption of renewable energy and some of its determinants. However, unidirectional causality runs from CO2 emission to GDP which implies that fossil fuels are significant drivers of real GDP or economic growth for Nigeria. It is evidenced that environmental considerations are less critical than real income to the consumption and development of renewable energy in Nigeria. Policy-makers should proffer incentives and measures that incentivize increased production and consumption of renewable energy while driving macroeconomic stability – especially in post COVID-19 era.

Causality nexus of renewable energy consumption and social development: Evidence from high-income countries

A substantial body of research has been carried out to analyze the determinants of renewable energy consumption, taking into consideration wide range of variables related to economic performance, environmental, institutional and political conditions. Nevertheless, little is known about the impact of social development on renewable energy consumption. The aim of the paper is to overcome this shortcoming and to investigate the causality nexus of renewable energy consumption and social development in the short and the long run, using a panel data set for 27 high-income countries over the period 1995–2015.The proposed methodology is based on the calculation of a Social Development Index (SDI) by aggregating several indicators related to social wellbeing. Next, a causality analysis is made based on the Engle-Granger two-step approach.Empirical analysis shows that social development contributes significantly to renewable energy consumption in the long-run, but not in the short-run. Nevertheless, based on a simulation analysis by generating from 1% to 10% additional annual growth rate in the SDI, we show that an additional 7% in the annual growth rate in social development is sufficient to make its short-run effect significant, and the highest impact is expected to be reached by the first additional 3%.

Renewable energy consumption in Africa: Evidence from a bias corrected dynamic panel

Our study investigates the determinants of renewable energy consumption in Sub-Sahara Africa. We explore the driving factors of renewable energy consumption in the context of carbon intensity for 32 Sub-Saharan African countries from 1990 to 2015. Using carbon emission intensity to identify group-specific heterogeneity, we recognize carbon-efficient and least carbon-efficient countries in the region. By relying on the corrected least squares dummy variable estimator (LSDVC), we provide evidence on the driving factors of renewable energy consumption in Sub-Saharan Africa. Consequently, the findings point to varying degrees of impact on renewable energy consumption in the region. For instance, we observe advancement in technology, quality of governance, economic progress, biomass consumption, and climatic conditions influence renewable energy consumption. With a common occurrence across all groups, the implications indicate environmental, socio-economic, and climatic factors playing an important role in renewable energy consumption. The study further shows that urbanization and economic globalization depress efforts towards renewable energy consumption. Apart from these common factors, other controlling variables including; GDP per capita, environmental awareness, and biomass affect each group differently. We conclude that, policy implications can be drawn from common factors towards harmonization of clean energy markets and developing a policy mix that combines environmental, economic, and social factors in attaining the Sustainable Development Goals.

Eco-innovation and energy productivity: New determinants of renewable energy consumption

This study provides new empirical evidence on the determinants of renewable energy consumption in the case of OECD economies over the period from 1990 to 2017. To examine the long run relationship among variables of renewable energy consumption and its determinants, this study uses the Durbin Hausman group mean cointegration test. The long-run and short-run coefficients are estimated via the cross-sectional Autoregressive Distributive Lag (CS-ARDL) method. The significant cointegration vector confirms the long-run equilibrium among the variables presented in the model. The results show that income, human capital, energy productivity, energy prices, and eco-innovation are important factors in explaining renewable energy consumption. This study adopts the Augmented Mean Group (AMG) method to check the robustness of the model. The results are found to be consistent with the estimates of the cross-sectional Autoregressive Distributive Lag Model method. To offer viable solutions to environmental problems and to achieve the targets set in the Paris Climate Agreement, policies and strategies should be devised to increase the share of renewable energy in the overall energy mix.

Modeling the determinants of renewable energy consumption: Evidence from the five most populous nations in Africa

Abstract The increasing concern over global warming and energy security has rejuvenated the renewable energy option as the most vibrant option to sustaining future energy needs. This paper developed a renewable energy consumption model using annual data spanning between 1996 and 2016 in the five most populous countries (Ethiopia, South Africa, Nigeria, DR Congo, and Egypt) in Africa. Following the existing literature on the subject, the driving factors investigated were categorized into three broad areas. These include macroeconomic, socioeconomic, and institutional variables. Altogether, thirty-four predictor variables are analyzed. The study employed Bayesian Model Averaging (BMA) procedures to account for the uncertainty associated model choice and variable selection. The results of the analysis indicate that population growth, urban population, energy use, electric power consumption, human capital are the main determinants of renewable energy consumption in the selected countries. Also, an increase in any of these determinants (population growth, urban population, energy demand/use, electricity power demand/consumption) causes an increase in renewable energy consumption.

The impact of economic globalization on renewable energy in the OECD countries

This paper analyzes the determinants of renewable energy consumption in the panel data of 30 OECD countries for the period from 1970 to 2015. The unique role is given to the effect of economic globalization on renewable energy. We consider several measures of economic globalization and apply different econometric techniques. We find the positive impact of the per capita income, the per capita carbon dioxide emissions, and the real price of oil on renewable energy. Also, a higher level of economic globalization promotes renewable energy, and the evidence is robust to the different measures of economic globalization. In line with our findings, promoting the economic aspects of globalization will enhance renewable energy. Thus it can suppress the adverse effect of climate change and global warming on living human beings and natural habitats in the long-run. Therefore, we need to enhance our knowledge of how globalization promotes renewable energy not only for the OECD countries but also for other developing and developed economies. From a policy perspective, we suggest that policymakers and governments in OCED countries should consider economic globalization as a “renewable energy promoting mechanism” while designing their energy demand policy for the protection of natural environmental health.

AN EMPIRICAL ANALYSIS OF FACTORS AFFECTING RENEWABLE ENERGY CONSUMPTION IN ASSOCIATION OF SOUTHEAST ASIAN NATIONS-4 COUNTRIES

This study aimed to explore the determinants of renewable energy consumption in selected ASEAN countries by emphasizing the significant role played by the quality of governance. This paper is classified according to the coverage of three dimensions approach (economic, environment, and governance) for sustainability. This study employed panel data analysis to examine the relationship between GDP, CO 2 emissions, FDI, trade openness, urbanization, and quality of governance on renewable energy consumption in selected ASEAN countries from 1990 to 2016. The results revealed that urbanisation has a significant positive impact on renewable energy based on FMOLS and DOLS analyses while the quality of governance has a significant positive impact on renewable energy based on PMG analysis in the long run. However, GDP and trade openness have a significant negative impact on renewal energy. The elasticity analysis in the short run revealed that none of the factors applied in this study affected renewable energy consumption. Hence, several policies are recommended as an excellent approach to meet the energy demand of private investors and future generations. Keywords : Renewable Energy, ASEAN, Quality of Governance, Panel Estimation JEL Classifications : F64, Q42, P28 DOI: https://doi.org/10.32479/ijeep.8142

Renewable Energy Consumption in Africa: Evidence From a Bias Corrected Dynamic Panel

Our study investigates the determinants of renewable energy consumption in Sub-Sahara Africa. We explore the driving factors of renewable energy consumption in the context of carbon intensity for 32 Sub-Saharan African countries from 1990 to 2015. Using carbon emission intensity to identify group-specific heterogeneity, we recognize carbon-efficient and least carbon-efficient countries in the region. By relying on the corrected least squares dummy variable estimator (LSDVC), we provide evidence on the driving factors of renewable energy consumption in Sub-Saharan Africa. Consequently, the findings point to varying degrees of impact on renewable energy consumption in the region. For instance, we observe advancement in technology, quality of governance, economic progress, biomass consumption, and climatic conditions influence renewable energy consumption. With a common occurrence across all groups, the implications indicate environmental, socio-economic, and climatic factors playing an important role in renewable energy consumption. The study further shows that urbanization and economic globalization depress efforts towards renewable energy consumption. Apart from these common factors, other controlling variables including; GDP per capita, environmental awareness, and biomass affect each group differently. We conclude that, policy implications can be drawn from common factors towards harmonization of clean energy markets and developing a policy mix that combines environmental, economic, and social factors in attaining the Sustainable Development Goals.

What are the Main Determinants of Renewable Energy Consumption? A Panel Threshold Regression Approach

Because of severe environmental impacts associated with the use of conventional energy sources, most of the countries attempt to decarbonize their energy sector by increasing share of renewable energy in their total energy consumption which also reduces their energy import dependency. Therefore, this study aims to understand the determinants of renewable energy consumption for 58 countries over the period from 1990 to 2012. The period and number of countries are determined based on the data availability for all the variables. For example, data on total greenhouse gas emissions is available only up to 2012. Analysis is based on a panel threshold regression model to find out asymmetric behavior of renewable energy consumption. The model explains renewable energy consumption by various economic factors in a nonlinear framework. Different effects of these factors are expected under different economic regimes characterized by income level. Results show that for real GDP per capita lower than 1527.977 US$, signs, statistical significance and magnitude of coefficients on some variables differ tremendously compared to the upper regime verifying the asymmetric relationship. Therefore, one can conclude that determinants of renewable energy consumption differ across countries and time based on the real GDP per capita level.

Determinants of renewable energy consumption in Africa.

Although the role that renewable energy consumption plays on economic growth and emissions has been widely studied, there are relatively few papers focusing on the determinants of renewable energy consumption, and only one study focuses on the factors related to the share of renewables in the energy consumption in Africa. This paper contributes to the literature by filling the gap in knowledge by exploring the nexus between the share of renewables in energy consumption and social and economic variables, for a panel consisting of 21 African countries for the period between 1990 and 2013, extending the set of variables and the time span used by a previous study. Estimating a random-effects generalized least squares regression, we find that countries with a higher Human Development Index and a higher gross domestic product per capita have a lower share of renewable energy in the national grid. On the other hand, an increase in foreign direct investment has been found to be related to higher renewable energy integration. The level of democracy, measured by the Freedom House political rights and civil liberties ratings, does not directly affect the integration level of renewable energy sources. The negative relationship between gross domestic product per capita and the share of renewables contradicts previous findings for developed countries. This contradiction and policy implications are discussed in the light of the review of the energy mix of the selected countries.

A panel data analysis of renewable energy consumption in Africa

The increasing global demand for energy security and sustainable development necessitated the need for a paradigm shift from fossil fuel energy sources to renewable energy sources in Africa. There is a dearth of information on the current pattern of renewable energy consumption as well as its key drivers in Africa. This study was therefore designed to investigate the determinants of renewable energy consumption in Africa, with a view to understanding the current pattern and its potential determinants.The study employed the panel data analysis involving five most populous and biggest economy in each of the five regions of Africa namely; Nigeria (West), Egypt (North), Ethiopia (East), DR Congo (Central) and South Africa (Southern) and using annual data from 1990 to 2015. Empirical analysis involved the estimation of both fixed effects and random effects models, while the Hausman test was employed for selecting the appropriate panel model and was found to be significant at p ≤ 0.05.Hausman test statistic value of 52.74 which was used to decide between fixed effects model and random effects model was found to be significant at 5%. The F-Statistic test value of 94.15 from the estimated fixed effect model was significant at 5%.

Unraveling the contemporary drivers of renewable energy consumption: Evidence from regime types

The detrimental effect of climate change and pollutant emissions has shifted the attention of researchers and policymakers toward renewable energy resources. To unravel the underexplored determinants of renewable energy consumption, this study examines the individual and combined effect of innovativeness, regulatory quality, trade openness, and tax attractiveness after controlling for per capita GDP, financial liberalization, inflation, and political stability. In addition, system‐generalized method of moments estimator is utilized to reduce endogeneity bias in the model. A broader sample size of 85 countries is investigated and further divides it into four sub‐panels on the basis of regime types (full democracy, flawed democracy, hybrid, and authoritarian regime). The findings indicate that innovativeness, regulatory quality, and trade openness are the major drivers of renewable energy consumption in global panel. The combined effect of innovativeness and regulatory policy is also statistically significant on renewable energy consumption. Furthermore, tax attractiveness positively moderates the relationship between trade openness and renewable energy consumption. The results differ across sub‐panels; however, the observed factors explain more variation in renewable energy consumption for full democracy and flawed democracy panels. It is suggested that economies should be shifted from authoritarianism to democracy to improve their public, industrial, trade, and tax policies which may help them to boost the consumption and production of clean energy. © 2019 American Institute of Chemical Engineers Environ Prog, 38:e13146, 2019

Economic performance, environmental concerns, and renewable energy consumption: drivers of renewable energy development in Sub-Sahara Africa

This paper analyzes the drivers of renewable energy development and consumption in Sub-Sahara African countries for the period, 1980–2011. The fully modified ordinary least squares, dynamic ordinary least squares, and fixed-effects estimation techniques are used to evaluate the statistical significance of the determinants of renewable energy consumption. Results indicate that income has the desired positive, albeit statistically insignificant contribution to renewable energy consumption growth. This indicates that recent economic strength in the region has not been accompanied by increased development and consumption of renewable energy, in contrast to empirical evidence in other developing economies. A review of the possible reasons for this incongruence is presented. Also, increased consumption of renewable energy is associated with heightened concerns for climate change caused by pollutants such as carbon dioxide. Population and industrial expansion are statistically significant determinants of renewable consumption, and oil prices correlate negatively with renewable energy consumption.

Determinants of Renewable Energy Consumption among ECO Countries; Based on Bayesian Model Averaging and Weighted-Average Least Square

Over recent years, renewable energy sources have emerged as an important component of world energy consumption. Increased concern over issues related to energy security and global warming suggests that in the future there will be a greater reliance on renewable energy sources. Given the role of renewable energy in the discussion of a reliable and sustainable energy future, it is important to understand its main determinants and to draw result implications for energy policy. This paper identifies the key determinants of renewable energy consumption among Economic Cooperation Organization (ECO) countries, over the period 1992-2011. There is a large literature on determinants of energy consumption and several studies have included a large number of explanatory variables. Empirical models of energy consumption are plagued by problems of model uncertainty concerning the choice of explanatory variables and model specification. We utilize Bayesian Model Averaging (BMA) and Weighted-Average Least Square (WALS) to resolve these model uncertainties. We have used not only conventional explanatory variables that have been used in last studies, but also institutional variables to consider the effect of socio-economic environment. The results of this study indicate that the institutional environment proxies, urban population, and human capital are the most important variables affecting renewable energy consumption in the ECO economies. Also the second and third effective variables are the renewables potential which lead to an increase in renewable energy consumption, and Co2 emission which has revers effect respectively. Therefore improving of institutional circumstances and human capital can be useful to renewable energy growth and reducing of detrimental externalities of fossil energy consumption.