Renewable Energy and Carbon Intensity: Global Evidence from 184 Countries (2000–2020)

Maxwell Kongkuah () and Noha Alessa
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Maxwell Kongkuah: Department of Economics, Faculty of Political Sciences, Canakkale Onsekiz Mart University, Canakkale 17100, Türkiye
Noha Alessa: Department of Accounting, College of Business Administration, Princess Nourah Bint Abdulrahman University, P.O. Box 84428, Riyadh 11671, Saudi Arabia

Energies, 2025, vol. 18, issue 13, 1-29

Abstract: This study investigates how various renewable energy technologies influence national carbon intensity (CO 2 emissions per unit of GDP) across 184 countries over the period 2000–2020. In the context of Sustainable Development Goals (SDG 7 and SDG 13) and the post-Paris-Agreement policy landscape, it addresses the gap in understanding technology-specific decarbonization effects and the role of governance. A dynamic panel framework employing the Dynamic Common Correlated Effects (DCCE) estimator accounts for cross-sectional dependence and temporal persistence, while disaggregating total renewables into hydropower, wind, solar, and geothermal generation. Environmental regulation is incorporated as a moderating variable using the World Bank’s Regulatory Quality index. Empirical results demonstrate that higher renewable generation is associated with statistically significant reductions in carbon intensity, with hydropower showing the most consistent negative effect across all income groups. Solar and geothermal technologies yield substantial carbon-reducing impacts in lower-middle-income settings once supportive policies are in place. Wind exhibits heterogeneous outcomes: positive or insignificant effects in some high- and upper-middle-income panels prior to 2015, shifting toward neutral or negative after more stringent regulation. Interaction terms reveal that stronger regulatory environments amplify renewable-driven decarbonization, particularly for intermittent sources such as wind and solar. Key contributions include (1) a comprehensive global assessment of four disaggregated renewable technologies; (2) integration of regulatory quality into decarbonization pathways, illustrating post-2015 policy moderations; and (3) methodological advancement through a large-sample DCCE approach that captures unobserved common shocks and heterogeneous country dynamics. These findings inform targeted policy measures—such as prioritizing hydropower where feasible, strengthening regulatory frameworks, and tailoring technology strategies—to accelerate low-carbon energy transitions worldwide.

Keywords: Sustainable Development Goals (SDGs) 7 and 13; renewable energy; climate action; environmental regulation; DCCE (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2025
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