The Relationship of Renewable Energy Generation, Renewable Energy Consumption, and Economic Growth

Abstract

Renewable energy production and consumption has a triggering effect on the components associated with the energy sector. This study aims to analyze the effects of renewable energy generation and consumption on economic growth in Türkiye for the period 1990-2020 based on annual data. For the analyses in the study, the vector autoregression model (VAR) and Johansen cointegration test, vector error correction, and Granger causality are used for the data of renewable energy consumption (REC, percentage of total final energy consumption), renewable electricity generation (REG, per capita electricity generation from renewables), and economic growth (GDP constant 2010 US$). According to the findings from the study, no causality was found from production to gross domestic product from renewable energy consumption in the short run, but causality from renewable energy consumption to gross domestic product was found. In the long run, it can be said that renewable energy consumption is not the cause of gross domestic product, but gross product is the cause of renewable energy consumption.