A Roadmap toward Achieving Sustainable Environment: Evaluating the Impact of Technological Innovation and Globalization on Load Capacity Factor

Abstract

Technological innovations have been a matter of contention, and their environmental consequences remain unresolved. Moreover, studies have extensively evaluated environmental challenges using metrics such as nitrogen oxide emissions, sulfur dioxide, carbon emissions, and ecological footprint. The environment has the supply and demand aspect, which is not a component of any of these indicators. By measuring biocapacity and ecological footprint, the load capacity factor follows a certain ecological threshold, allowing for a thorough study on environmental deterioration. With the reduction in load capacity factor, the environmental deterioration increases. In the context of the environment, the interaction between technological innovation and load capacity covers the demand and supply side of the environment. In light of this, employing the dataset ranging from 1980 to 2017 for the case of South Africa, the bound cointegration test in conjunction with the critical value of Kripfganz and Schneider showed cointegration in the model. The study also employed the ARDL, whose outcome revealed that nonrenewable energy usage and economic growth contribute to environmental deterioration, whereas technological innovation and globalization improve the quality of the environment. This study validated the hypothesis of the environmental Kuznets curve for South Africa, as the short-term coefficient value was lower than the long-term elasticity. Furthermore, using the frequency-domain causality test revealed that globalization and economic growth predict load capacity in the long term, and nonrenewable energy predicts load capacity factors in the long and medium term. In addition, technological innovation predicts load capacity factors in the short and long term. Based on the findings, we propose that policymakers should focus their efforts on increasing funding for the research and development of green technologies.