Factors of Renewable Energy Consumption in the European Countries—The Bayesian Averaging Classical Estimates Approach

Atif Khan (), Jacek Kwiatkowski, Magdalena Osinska and Marcin Błażejowski
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Jacek Kwiatkowski: Department of Econometrics and Statistics, Faculty of Economic Sciences and Management, Nicolaus Copernicus University in Torun, Gagarina 13 A, 87-100 Torun, Poland

Energies, 2021, vol. 14, issue 22, 1-24

Abstract: The paper aims to identify the most likely factors that determine the demand for energy consumption from renewable sources (renewable energy consumption—REC) in European countries. Although in Europe, a high environmental awareness is omnipresent, countries differ in scope and share of REC due to historical energetic policies and dependencies, investments into renewable and traditional energetic sectors, R&D development, structural changes required by energetic policy change, and many other factors. The study refers to a set of macroeconomic, institutional, and social factors affecting energetic renewable policy and REC in selected European countries in two points of time: i.e., before and after the Paris Agreement. The Bayesian Average Classical Estimates (BACE) is applied to indicate the most likely factors affecting REC in 2015 and 2018. The comparison of the results reveals that the Gross Domestic Product (GDP) level, nuclear and hydro energy consumption were the determinants significant in both analyzed years. Furthermore, it became clear that in 2015, the REC depended strongly on the energy consumption structure, while in 2018, the foreign direct investment and trade openness played their role in increasing renewable energy consumption. The direction of changes is gradual and positive. It complies with the Sustainable Development Goals (SDGs).

Keywords: energy from renewable sources; economic; institutional and social factors; Bayesian Average Classical Estimates (BACE); Paris Agreement (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: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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