Role of Renewable Energy Consumption and Technological Innovation to Achieve Carbon Neutrality in Spain: Fresh Insights From Wavelet Coherence and Spectral Causality Approaches

Abstract

This research offers a new perceptive of the dynamic connection between CO2 and globalization, technological innovation (TI), economic growth, and renewable energy (REN) consumption in Spain. The current research applied the wavelet tools to assess these interconnection utilizing data stretching from 1980 to 2018. The outcomes of these analyses disclose that the association among the series evolves over frequency and time. The current analysis uncovers notable wavelet coherence and strong lead and lag connections in the frequency domain, whereas the time domain indicates inconsistent correlations among the variables of interest. The outcomes of the wavelet analysis from the economic perspective affirm that in the short and medium term, globalization, economic growth, and TI contribute to environmental degradation; however, in the long term, globalization, economic growth, and TI do not contribute to the degradation of the environment. Moreover, at different frequencies, REN consumption helps mitigate environmental degradation in Spain. Furthermore, the spectral causality test unveiled that in the long term, REN utilization, globalization, TI, and economic growth can predict CO2 emissions in Spain.