Domino-effect of energy consumption and economic growth on environmental quality: role of green energy in G20 countries

Abstract

PurposeThis study explores the interplay among climate change, economic growth and energy consumption in G20 countries by considering the role of green energy.Design/methodology/approachThis study uses various empirical tools to determine the association between carbon emissions, economic growth, renewables, non-renewables, population and urbanization for a panel of G20 countries between 1990 and 2014.FindingsEmpirical outcomes from various empirical tools reveal a positive and significant impact of economic growth, non-renewable energy consumption and urbanization on carbon emissions, and their increase will further lead to the deterioration of environmental quality. The elasticity coefficient of renewable energy coefficient is negative and significant implying an increase in its consumption will improve environmental quality. Panel causality test results reveal the existence of both short-run and long-run causality among the variables. Therefore, results infer that a reduction in the consumption of non-renewable and substitution with renewables will have a significant impact on carbon emission mitigation.Originality/valueThrough this study, the authors suggest the sustainable use of renewables as they are sustainable, secure, efficient, environmentally justifiable and economically viable sources of energy. Therefore, replacing traditional non-renewables with modern renewables has the potential in avoiding the dangerous impacts of greenhouse gases (GHGs) particularly in the G20 countries. This paper intends to guide policymakers regarding the environmental quality and renewable energy consumption required to hold back the fossil fuel dependence for a cleaner and greener planet.