Energy Investment Research Articles

Transition of China’s global energy investment: Decarbonization, dispersion and denationalization

China’s global energy investment (CGEI) plays a role in global energy transition. This paper uses a “3D” (decarbonization, denationalization, and dispersion) framework to analyze CGEI from 2005 to 2020 based on the China Global Investment Tracker (CGIT) database. Results indicate that significant decarbonization of CGEI has occurred, particularly after 2013, with the most pronounced effects observed in middle- and low-income countries. Dispersion is also significant as Chinas investment reached some 97 countries expanding across the globe to Africa and Latin America, led by solar and wind energy. On the other hand, a denationalization trend was less obvious. After a short period of expansion by private enterprises, denationalization stalled as central state-owned enterprises surged ahead in leading CGEI.

Analysis of Factors Affecting CO2 Emissions in Türkiye Using Quantile Regression

This study aims to show how the impact of factors on carbon dioxide (CO2) emissions differs at the quantile level and to demonstrate the superiority of the quantile regression method over the OLS method by using quantile regression and ordinary least squares (OLS) methods in order to examine the factors affecting CO2 emissions in Türkiye in depth. Covering the period 1990–2021, this study evaluates the relationship between CO2 emissions and GDP per capita growth, population growth, and renewable energy consumption. One of the important findings of the study is that the increase in the population ratio, which is insignificant according to the OLS method, positively affects CO2 emissions at the 0.25 quantile point. According to both OLS and quantile regression methods, GDP growth does not affect CO2 emissions, while renewable energy consumption has a significant and negative effect according to both models. These results demonstrate that economic growth has no discernible impact on CO2 emissions in Türkiye, while investments in renewable energy can significantly lower emissions and open the door for quantile regression to be used more widely in related research. Unlike traditional methods that focus only on the conditional mean, the quantile regression method provides a comprehensive framework for Türkiye’s sustainable development policies by exploring factor effects at different emission levels.

Trends and opportunities in renewable energy investment in Saudi Arabia: Insights for achieving vision 2030 and enhancing environmental sustainability

Renewable energy has emerged as a critical alternative to traditional energy sources due to growing environmental concerns and the need for sustainable energy development. Saudi Arabia, driven by its Vision 2030, has strongly committed to shifting from fossil fuels to renewable energy sources such as solar, wind, and hydrogen. Despite significant progress, existing investment methods often focus narrowly on financial returns and do not adequately address the risks and uncertainties associated with renewable energy projects, such as policy changes, technological challenges, and fluctuating energy prices. This paper aims to highlight and compare the trends in renewable energy investments and incorporate a risk analysis matrix to address the economic, environmental, and social aspects of Saudi Arabia’s environment. The details used in the study are obtained from Kaggle, while the adopted analysis technique involves multi-criteria decision-making (MCDM). It provides a fresh qualitative approach that allows an all-sided assessment of the investment prospects by focusing on appropriate weight for different factors. The analysis results show that using the proposed framework can help effectively prioritize investment opportunities identifying major trends and risks in developing renewable energy sources in Saudi Arabia. Current investment trends have been reviewed systematically; experts have been interviewed; MCDM techniques have been employed, as the methodology effectiveness improves the comprehension of investment tendencies and contributes to strategic management in the renewable energy market stakeholder’s activity. The MCDM analysis results show that the solar energy system has the highest investment index in the Saudi Arabian cities; the first place belongs to Abha with an investment index of 0.93, the second place belongs to Jeddah with an investment index of 0.85, and the third place belongs to Dammam with an investment index of 0.75. From these outcomes, we can easily conclude that Abha is the best place to place a solar energy project, probably because of environmental and legal factors. The analysis underscores geographic factors in deploying renewable energy, directing investors and policymakers to cities with favourable solar power generation about sustainability and economic objectives. The results are expected to enhance investment awareness among local and international stakeholders, support the strategic goals of Vision 2030, and contribute to a more sustainable and diversified energy future for Saudi Arabia. This study provides a strategic framework for optimizing renewable energy investments, promoting sustainable development, and achieving long-term economic growth. Data AvailabilityData sharing is not applicable to this article as no data sets were generated during the current study.

Climate-Driven Sustainable Energy Investments: Key Decision Factors for a Low-Carbon Transition Using a Multi-Criteria Approach

Currently, the need for a clean transition has made the upscaling of sustainable energy investment projects imperative. This paper addresses the increasing importance of sustainable energy investment projects in the context of climate change and the urgent need for a global energy transition. Given the complexity of decision-making in this field, a multi-criteria decision-making (MCDM) approach is employed to assess the main criteria considered by project developers and financial institutions. Using the Analytic Hierarchy Process (AHP) method, eight criteria are identified and evaluated. Results highlight differing priorities between project developers and investors, emphasizing the need for adaptable approaches to accelerate sustainable energy investments. The study underscores the importance of understanding diverse stakeholder preferences and priorities in formulating effective strategies and managing associated risks to effectively promote sustainable energy projects. Future research should focus on real-life case studies and policy assessments to further enhance the understanding of sustainable energy investment dynamics.

Public Energy R&D Spending and Green Energy for Sustainable Development: COP28 Perspective of G7 Economies

Achieving sustainable development goals (SDGs) is one of the top priorities for countries worldwide, and the recent COP28 has focused mainly on achieving sustainable development via clean energy investment financing. However, countries and regions still struggle to find various policy-level indicators to achieve sustainability engagement. In this context, finding the right combination of policy indicators becomes crucial. Therefore, the current study seeks to identify the key drivers of sustainability for the G7 economies by utilizing data from 1990–2019. This study employed the cross-sectional autoregressive distributed lag (CS-ARDL) panel time series method of estimating primary results and a novel sustainable development index as the dependent variable. The study revealed that public energy R&D budgets, increasing income levels, improving the political risk index, and promoting clean energy are important for achieving sustainable development in the G7 countries and that the depletion of natural resources has an adverse influence on sustainability. These empirical results are supported by various economic and environmental theories, i.e., the environmental Kuznets curve, the innovation theory of sustainability, the Dutch disease hypothesis, and the political economy of development and energy transition theory. Based on these findings, energy investment is recommended, especially for clean energy projects, and increasing income levels via sustainable economic activities to achieve sustainability in the G7 economies.

The role of financial inclusion and technological innovation in stimulating environmental sustainability in the European countries: A new perspective based on load capacity factor

Given the alarming level of climate change, policymakers across the globe are seeking strategies to mitigate environmental pollution to achieve sustainable development. In this context, renewable energy and technological advancements have emerged as an effective way to lower pollution and attain sustainable development. This study evaluates the effect of financial inclusion, technological innovation, and renewable energy on the load capacity factor (LCF) in European countries from 2004 to 2018. LCF is considered the most comprehensive indicator of ecological sustainability, combining both the biocapacity factor and ecological footprint. Hence, the present work fills the literature gap by exploring, for the first time, the effect of financial inclusion on the LCF. Applying the advanced Method of Moment Quantile Regression (MMQR), the study demonstrates that technological innovation and economic growth have adverse effects on LCF while renewable energy and financial inclusion promote LCF. The study indicates that technological innovation and economic growth undermine ecological excellence in European nations while green energy and financial inclusion enhance it. Moreover, the findings of the causality analysis reveal a causal association between financial inclusion, renewable energy, and LCF. Our study recommends prioritizing financial inclusion alongside investments in renewable energy to enhance ecological sustainability.

Towards a Standardized LCOE Calculation for Informed Decision-Making in Energy Policy and Investment: Application to the Colombian Context

The Levelized cost of electricity - LCOE represents a constant cost per unit of generated electrical energy, resulting from the analysis of the total costs throughout the life cycle of a generation plant. Its widespread use, thanks to its simplicity of calculation and potential of standardization, has made it one of the primary criteria for comparing electricity generation technologies. However, in the pursuit of simplification and generalization, certain aspects associated with the socioeconomic context of the region, as well as accounting and financial concepts, are excluded due to externalities or incentives related to regulatory and fiscal policies. These exclusions affect the accuracy of LCOE and introduce uncertainty when using it as a criterion for investment decision-making or allocation of public resources for the development of renewable sources. This article proposes a clear and standardized methodology for calculating LCOE, which allows for a fair and precise comparison of renewable energy generation options in rural areas. It contributes to informed and transparent decision-making in the fields of energy policy and public investment for expanding electricity service coverage. The proposed methodology is based on the financial cash flow matrix to address variability sources in the calculation, considering the local context of the generation project.

Toward Environmental Sustainability: The Nexus between Agriculture, Renewable Energy, and Economic Growth in Mitigating CO2 Emissions in Somalia

This research investigates the intricate relationships between agriculture, renewable energy, economic growth, and carbon dioxide (CO2) emissions in Somalia from 1991 to 2022. This study uses the Autoregressive Distributed Lag (ARDL) model and Granger causality tests to understand their impact on environmental sustainability. ARDL results reveal a negative role of agriculture and renewable energy on CO2 in the short and long term. The country's reliance on fossil fuels and biomass further intensifies CO2 emissions. While economic growth is essential for improving living standards, it positively correlates with CO2 emissions in the short and long term, emphasizing the challenge of decoupling economic development from environmental degradation. Domestic investment has a short-run relation only to CO2 emissions. In Granger causality tests, the results indicated that Agriculture and domestic investment have bidirectional causality to carbon dioxide emissions. On the other hand, renewable energy, economic growth, and domestic investment have unidirectional causality to Agriculture in Somalia, while domestic investment has bidirectional causality to renewable energy and economic growth. The study recommends implementing comprehensive and integrated approaches to prioritize sustainable development strategies, clean energy alternatives, and efficient agricultural practices. Promoting economic growth while also focusing on capacity-building and awareness campaigns is essential. Collaborating with the international community on climate change mitigation and sustainable development initiatives can further support Somalia's journey toward environmental sustainability.

Corporate Tax Planning: Making Sense of Canada's Clean Energy Investment Tax Credits

Corporate Tax Planning: Making Sense of Canada's Clean Energy Investment Tax Credits

Optimal dimensioning of renewable energy generation and storage systems

With high energy demand and large available area, agricultural farms offer significant potential for renewable energy investments, like photovoltaic systems and electrical energy storages. However, the profitability of such investments depends strongly on self-consumption, so accurate planning requires computation-intensive simulation and optimization considering local consumption. This study presents a novel methodology for the optimal dimensioning and configuration of photovoltaic systems and electrical energy storages using efficient techniques from continuous non-linear optimization. Combining physical and economic models with measured consumption data, an investment’s net present value over 20 years is maximized. Using gradient-based solver WORHP, the simulation, optimal control, and optimal dimensioning of the local energy system are calculated simultaneously, allowing for efficient computation over an entire year of hourly data to capture both daily and seasonal variations.The approach is demonstrated with simple use cases, including an exemplary day of a dairy farm’s consumption, for which optimal systems with and without storage achieve 77% and 43% of autarky, respectively. Saturation effects of optimal plant size can be observed when sizes are large enough for optimal self-consumption but not expanded further for grid export. With energy storage, this saturation is reached at higher values. Optimizing photovoltaic plants with different orientations to match the specific consumption patterns characteristic of the dairy farm achieves similar autarky as a single plant while reducing investment costs by more than 20%. While thorough validation and comparison against heuristic methods predominantly used in the field is part of ongoing research, the presented use cases demonstrate the flexibility and efficiency of the proposed method and highlight its promise as a planning tool in the agricultural domain and beyond.

Investigating the Impact of Renewable Energy Investment Announcements on Stock Returns of Borsa Istanbul Energy Companies

Investigating the Impact of Renewable Energy Investment Announcements on Stock Returns of Borsa Istanbul Energy Companies

Does climate risk as barometers for specific clean energy indices? Insights from quartiles and time-frequency perspective

This study presents the first analysis of the nexus between the Southern Oscillation Index (SOI), a measure of climate risk, and segmented clean energy indices (such as solar, renewable, and bioenergy). Our research findings indicate that (i) the Granger quantile causality significance of SOI on segmented clean energy indices is asymmetric across different conditional quantiles. Significant predictability of SOI is observed only at the 0.25 and 0.75 quantile levels for all segmented clean energy indices, except for the WilderHill Clean Energy Index and NASDAQ OMX Fuel Cell Index. (ii) The clean energy market is significantly influenced by SOI under bullish market conditions. Impacts of SOI on all clean energy markets are nearly negligible when clean energy indices are at the median and lower quantile levels. (iii) The influence of strong La Niña episodes on segmented clean energy indices is more pronounced than during periods of intense El Niño phenomena. (iv) SOI exhibited a positive correlation at mid-term and long-term frequencies with segmented Clean Energy sectors, excluding bioenergy, for the majority of the sample period. Our conclusions provide deeper insights for investors managing clean energy investments in extreme climate conditions. Additionally, they offer useful information for policymakers to formulate viable economic policies addressing climate change, ensuring energy security, and facilitating a safer transition to clean energy.

Data analytics driving net zero tracker for renewable energy

This research aims to assess the impact of renewable energy policies, investments, and emissions reductions toward achieving net-zero targets by 2050. We analysed key metrics using the Net Zero Tracker (NZT), including renewable energy capacity, policy strength, financial investment, and carbon emissions across multiple regions and industries. Our methodology involved data collection from 2020 to 2050, utilising predictive modeling to project trends in renewable energy adoption and emissions reduction. Key findings show that renewable energy capacity is expected to surpass 1000 GW by 2050, with an exponential increase around 2045. Policy Strength Index (PSI) will grow by 20 %, from 50 in 2020 to 60 in 2050, while investments in renewable energy will rise from $10 billion to $25 billion over the same period. Emissions are projected to steadily decrease to zero by 2050, which aligns with net-zero goals. The margin of error in the projections is ±5 %, considering potential policy implementation and technology development variations. These results underscore the critical role of enhanced policies, sustained investments, and international cooperation in accelerating the global transition to renewable energy. The research offers valuable insights for policymakers and stakeholders to guide future strategies for achieving a sustainable energy future.

Risk and Benefit Analysis of China’s Foreign Direct Investment in the Energy Sector: Case Study of the Belt and Road Initiative

Since 2011, China has been the world's largest energy consumer. The industrial sector uses two-thirds of the energy consumed in China. The main reason for investment in energy is that China is a net importer of energy, especially oil. The impact of Chinese foreign investments and the energy sector, which is the largest of the individual sectors, are the main subjects of the analysis of the presented paper. In the paper, we used the WoS viewer program to perform a bibliometric analysis of authors, countries, and keywords that deal with FDI. Subsequently, we used various scientific methods, such as the method of observation, method analysis, synthesis, comparison, exploration and explanation, to analyse Chinese investments that flow into multiple sectors worldwide, but especially into the countries participating in the Belt and Road Initiative and into the energy sector from 2013 to the present. As part of the Belt and Road Initiative, China invests in various projects in the form of "loans" and, in many cases, creates debt traps that allow China to seize the assets of participating countries. In this paper, we focused on the energy sector and its development so far within the given initiative, and we also defined what the initiative should focus on within renewable resources. China's energy investments include oil, hydropower, alternative energy, natural gas, and coal. The sharp drop in Chinese investment after 2019 was caused by the COVID-19 pandemic. To conclude, although energy has remained China's primary sector for investment within the BRI regions, Chinese capital has gradually diversified into sectors such as transportation, real estate, technology and innovation, and tourism.

Assessment and management of costs for renewable energy investments in Zambia using a novel mixed method.

This paper investigates strategies for managing costs in low-CO2 renewable energy (RE) projects, with a focus on enhancing investment efficiency. The study develops a novel mixed-method framework that integrates Shapley rates, TOPSIS, and Pythagorean fuzzy (PF) DEMATEL to identify effective cost-control tactics. Data is sourced from financial reports, project records, and expert evaluations involving three managers from the energy sector with over two decades of experience in renewable energy investments and CO2 emission reduction. The framework's precision is tested through the VIKOR technique and sensitivity analysis, using five scenarios where the weighting outcomes of criteria are adjusted. Findings reveal that solar energy consistently offers the most cost-effective solutions, while consumer prioritization significantly improves the viability of wind energy investments. The results also emphasize the importance of workforce development in solar energy projects and collaborative cost-control strategies to enhance project success. The study recommends that investors focus on high- or low-level collaborative approaches for solar energy due to its lower associated costs compared to other options. These insights can guide policymakers and investors in optimizing renewable energy investments and enhancing collaboration to reduce CO2 emissions.

Renewable Energy Investments, Support Schemes and the Dirty Option

ABSTRACTIn a real options framework, we analyze the behavior of a large energy producer who can invest in a portfolio of Renewable Energy Source (RES) and dirty energy source. Competitive fuel prices challenge the investments in RES. Given a budget constraint, the agent allocates the optimal capacities of both energy instalments and selects the optimal investment time. We use the model to compare the effectiveness of classical support schemes such as Feed‐in Tariffs or Green Certificate with respect to forms of taxation of dirty technology such as Carbon Taxes or Carbon Permits. This paper proposes a conceptual framework and qualitative analysis to understand which support system enhances the attractiveness of renewable energy investments.

How Financial Development Is Driving the Growth and Environmental Dimensions of Sustainable Development in Africa: Heterogeneous Analyses

Globally, we face a policy dilemma between desiring more economic growth and safeguarding the deteriorating ecosystem, which have an apparent trade-off. Consequently, financing growth often comes with strong concerns for the ecological implications, which is yet to be empirically resolved. Hence, the current study examined the growth and environmental effects of financial development from three angles, each with a robust indicator, comprising financial development index, financial institution index, and financial market index. The scope of this study was financial development in 30 selected African countries from 1996 to 2021. This study extends the frontier of knowledge by estimating the moderating roles of regulatory quality and digitalization coupled with other control variables: renewable and nonrenewable energy, government expenditure, trade openness, and foreign direct investment. The empirical evidence relies on estimators such as common correlated effects (mean group), the system-generalized method of moment, and method of moment quantile regression. The findings from this study reveal that financial development propels economic growth but to the detriment of the ecosystem. However, when the interactive effects of regulatory quality and digitalization are considered, the negative externalities of growth-induced financial development are reduced. Furthermore, control variables such as renewable energy and foreign direct investment promote growth without escalating ecological damage. This is in contrast to nonrenewable energy, government expenditure, and trade openness, which propel economic growth at the expense of the ecological system. Policy recommendations that balance the trade-off between the two measures are put forward based on the research outcomes.

Carbon Neutral Strategies in the Case of Google Inc: A Case Study of Carbon Offset Mechanisms and Renewable Energy Projects

Abstract: Facing the serious challenge of global climate change, Google Inc. has adopted a series of innovative strategies to reduce its carbon footprint and promote corporate sustainability. This paper provides an in-depth analysis of how Google reduces carbon emissions and promotes sustainable development through a series of innovative measures, including large-scale investment in renewable energy, improving data center efficiency, implementing carbon offset projects, and promoting technological innovation in the field of transportation. These actions demonstrate Google's commitment to environmental protection and provide a model for other companies to follow. The study evaluated the economic feasibility and environmental benefits of Google's strategies through a cost-benefit analysis. The results show that despite technical challenges and market uncertainty, Google's environmental investments can bring significant economic benefits in the long term while having a positive impact on the environment. These strategies help Google achieve its carbon neutrality goals and provide momentum for the global transition to a low-carbon economy. In addition, the study emphasizes the importance of socio-cultural factors in promoting environmental strategies. Google has raised public awareness of climate change and enhanced social support for environmental actions through community involvement and educational programs. These findings reveal the need for companies to adopt environmental protection measures in the context of globalization and provide practical guidance for other organizations to implement sustainable development strategies.

The Causal Nexus Among Energy Dependency, Human Capital, and Renewable Energy: An Empirical Analysis for EU Members

Countries have turned to developing renewable energy production, avoiding the risks posed by the disruptions in global energy trade, the high volatility in energy prices, and the remarkable environmental impairment. Numerous economic, environmental, institutional, and social factors have been put forward as driving factors toward renewable energy. The goal of this research article is to study the causal nexus among energy dependency, human capital, real GDP per capita, CO2 emissions, and renewable energy of the 27 EU members between 2000 and 2020 through Emirmahmutoglu and Kose causality test. The results of the panel-level causality tests demonstrate feedback interplay among energy dependency, human capital, real GDP per capita, CO2 emissions, and renewable energy use. However, the results of the country-level causality analysis unveil that the interplay among renewable energy utilization, energy dependency, real GDP per capita, CO2 emissions, and human capital remarkably varies among EU members. The results of this study suggest that renewable energy investments are significant instruments to make progress in energy security, human capital, real GDP per capita, and CO2 emissions. Furthermore, energy security, human capital, real GDP per capita, and CO2 emissions are significant drivers of renewable energy development.

Evaluating the Role of GCC Nations in Sustainable Energy Investment Using an Enhanced Low-Carbon Economy Index

In the past decade, environmental, social and country governance (ESG) aspects as well as economy have become key factors for decisions in the investment and future development of renewable energy industry. The abundancy of renewable resources and widely accessible technology are the key drivers for the renewable energy business in the GCC. However, lack of effective policies and regulations, along with subsidized fuel prices, are slowing down the implementation of renewable resource options. This study will illustrate the potential, the challenges, and the barriers of implementing renewable energy technologies in the GCC region. In addition, this research empirically examines the impact of renewable energy sources and other factors in the GCC countries. This study can be used as a screening tool, decision making tool, benchmarking tool and guidance of sustainable development.