Do Environmental Innovation and Green Energy Matter for Environmental Sustainability? Evidence from Saudi Arabia (1990–2018)

Abstract

Climate change and global warming, caused by excessive carbon emissions from transportation and other environmentally hazardous activities, are serious problems for many countries nowadays. Therefore, while some countries are not making optimal use of their resources, others are working hard to preserve a green and clean environment in order to foster long-term growth. Governments and policymakers throughout the world are finally starting to take the risks of climate change and global warming seriously. This paper extends previous literature related to environmental design practices by investigating the impacts of environmental innovation and the deployment of green energy on decreasing carbon dioxide (CO2) emissions for Saudi Arabia during the period 1990–2018. Different CO2 emission measures are incorporated in the analysis, namely per capita CO2 emissions, CO2 intensity, CO2 emissions from liquid fuel use, and CO2 emissions from heat and electricity generation. Overall, the outcomes of the autoregressive distributed lag (ARDL) technique demonstrate the presence of a long-term association between our two main variables (green energy use and environmental innovation) and the different measures of CO2 emissions, except CO2 emissions from liquid fuels consumption for green energy use and CO2 intensity for environmental innovation. In another sense, the use of renewable energies and technologies linked to environmental patents proves to be a good alternative if they do not contribute to environmental pollution. On the basis of the results, this study offers several policy recommendations.