A Comparative Perspective of the Effects of CO2 and Non-CO2 Greenhouse Gas Emissions on Global Solar, Wind, and Geothermal Energy Investment

Abstract

Greenhouse gas emissions, including carbon dioxide and non-CO2 gases, are mainly generated by human activities such as the burning of fossil fuels, deforestation, and agriculture. These emissions disrupt the natural balance of the global ecosystem and contribute to climate change. However, by investing in renewable energy, we can help mitigate these problems by reducing greenhouse gas emissions and promoting a more sustainable future. This research utilized a panel data model to explore the impact of carbon dioxide and non-CO2 greenhouse gas emissions on global investments in renewable energy. The study analyzed data from 63 countries over the period from 1990 to 2021. Firstly, the study established a relationship between greenhouse gas emissions and clean energy investments across all countries. The findings indicated that carbon dioxide had a positive effect on clean energy investments, while non-CO2 greenhouse gas emissions had a negative impact on all three types of clean energy investments. However, the impact of flood damage as a representative of climate change on renewable energy investment was uncertain. Secondly, the study employed panel data with random effects to examine the relationship between countries with lower or higher average carbon dioxide emissions and their investments in solar, wind, and geothermal energy. The results revealed that non-CO2 greenhouse gas emissions had a positive impact on investments only in wind power in less polluted countries. On the other hand, flood damage and carbon dioxide emissions were the primary deciding factors for investments in each type of clean energy in more polluted countries.