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Improving environmental quality through renewable energy: evidence from South Asian economies

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Abstract

Environmental degradation led climate change is jeopardizing sustainable development. To ensure sustainable development, environment-friendly resources should be harnessed. Among these resources, renewable energy has the potential to mitigate environmental degradation. This study investigates the relationship between renewable, nonrenewable energy consumption, and carbon dioxide emissions by utilizing the panel data of South Asian countries over the period 1990–2014. The study used cross-sectional dependence test, Pedroni co-integration, fully modified ordinary least square, dynamic ordinary least square, and Dumitrescu and Hurlin (2012) panel causality test to find the relationships among the variables. Furthermore, the study used panel threshold regression to estimate the amount of renewable energy required for carbon dioxide mitigation. An increase in the share of renewable energy by 4.5143% of total energy will mitigate carbon emissions. The results suggest that renewable energy leads to an improved environment whereas nonrenewable energy contributes to environmental degradation. Finally, the findings of this study imply that the substitution of fossil fuel energy resources with renewable resources is an appealing alternative for sustainable development of the South Asian economies.

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Acknowledgements

I hereby acknowledge that I am thankful to my supervisor Dr. Muhammad Tariq Majeed (Associate Professor, School of Economics, Quaid-i-Azam University Islamabad) for his valuable comments in improving the quality of the manuscript.

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  1. School of Economics, Quaid-I-Azam University, Islamabad, Pakistan

    T. Luni & M. T. Majeed

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Luni, T., Majeed, M.T. Improving environmental quality through renewable energy: evidence from South Asian economies. Int J Energ Water Res 4, 335–345 (2020). https://doi.org/10.1007/s42108-020-00073-6

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