Are research and development on energy efficiency and energy sources effective in the level of CO2 emissions? Fresh evidence from EU data

Faik Bilgili (), Daniel Balsalobre-Lorente (), Sevda Kuşkaya (), Mohammed Alnour (), Seyit Önderol () and Mohammad Enamul Hoque ()
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Faik Bilgili: Erciyes University
Daniel Balsalobre-Lorente: University of Castilla La Mancha
Sevda Kuşkaya: Erciyes University
Mohammed Alnour: Erciyes University
Seyit Önderol: Erciyes University
Mohammad Enamul Hoque: BRAC University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2024, vol. 26, issue 9, No 85, 24183-24219

Abstract: Abstract Climate change and natural resource depletion have reinvigorated the relevance of technical advancements in energy efficiency, which has been emphasized by the Paris Climate Accord that includes a framework for carbon neutrality. In that effort, the governments have been allocating a considerable amount of budget shares to research and development relating to energy efficiency and green energy. Thus, this study primarily examines the impact and effectiveness of research and development on energy efficiency and energy sources (renewables and fossil fuels) on CO2 emissions in the European region using a novel Method of Moments Quantile Regression (MMQR). Our data cover annual observations of 9 EU countries, including Austria, Denmark, Finland, France, Germany, Netherlands, Norway, Spain, and Sweden, based on the period 1990–2021. Our empirical findings confirm that the U-shaped Environmental Kuznets Curve occurs across all quantiles at 1% significance levels. The findings reveal that energy consumption increases CO2 emissions across the lower to higher quantiles. We discover that (i) R&D on renewable energy cuts CO2 emissions just at the median and higher quantiles, (ii) R&D on Fossil Fuels decreases CO2 emissions just at the lower quantile, and (iii) R&D on Energy efficiency lowers CO2 emissions at both the median and higher quantiles. Therefore, empirical findings suggest that policymakers should maintain their incentives for energy efficiency R&D and renewable R&D to achieve sustainable development goals.

Keywords: Research and development; Energy efficiency; Renewables; Fossil fuels; CO2 emissions; Method of moments quantile regression (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s10668-023-03641-y

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