Renewable energy deployment in Europe: Do politics matter?

Abstract

AbstractThis study analyzes non-hydroelectric renewable capacity across 27 European countries from 2000 to 2020, using advanced econometric techniques like the Dumitrescu and Hurlin panel Granger non-causality method, Panel Autoregressive Distributed Lag and Panel Quantile Autoregressive Distributed Lag estimations. This investigation reveals complex relationships extending beyond immediate variables. These relationships, rooted in pairwise causalities and broader interactions, underpin observed phenomena. Causality tests show that achieving non-hydroelectric renewable capacity is a long-term endeavor, emphasizing persistent policy approaches for effective energy transition. Three key variables emerge as potent policy drivers: maintaining an environment conducive to economic freedom, fostering financial development, and driving non-hydroelectric renewable patents’ research and development. These variables play a pivotal role in capacity expansion. Additionally, the findings of this empirical investigation spotlight the role of political orientations. Leftist governments have lagged in prioritizing energy transition, prompting questions about neglecting environmental concerns and necessitating comprehensive policy reform. In essence, this study offers novel insights into non-hydroelectric renewable energy deployment. By unraveling complex relationships, emphasizing persistent policies, and identifying key variables, this investigation provides a nuanced perspective in line with sustainable energy transition urgency. As global ecological imperatives heighten, our work guides informed policy decisions for a greener future.