How does hydrogen-based renewable energy change with economic development? Empirical evidence from 32 countries

The hydrogen-based renewable energy resource base is sufficient to meet several times the present world energy demand. This paper analyzes the drivers promoting hydrogen-based renewable energy utilization, focusing on a group of 32 countries by applying panel data techniques. The pooled ordinary least square estimator and fixed effect estimator are employed for comparison. Grey relational analysis is used to explore the relationships at a national level between renewable energy development and its influencing factors. The main results over our time span indicate that: (1) GDP per capita is a significantly positive contributor to renewable energy consumption, while oil price does not present a strong relationship in the use of renewables; (2) social awareness about climate change and concerns for energy security is not enough to motivate the switch from traditional to renewable energy sources; (3) the role of urbanization in renewable energy consumption relies on different stages of the urbanization process, resulting in opposite trends in renewable energy development between developing and developed countries. The results show that the market mechanism is not entirely responsible for encouraging the use of renewables and the role of climate change and energy security concerns in renewables use should be enhanced. By analyzing the results, policy implications are provided for the sustainable development of renewable energy.     

Does renewable energy substitute LNG international trade in the energy transition?

Renewable energy is a vital tool for the energy transition and sustainable development goals. The global economy, however, remains heavily reliant on fossil fuels despite efforts to reduce global greenhouse gas emissions. Demand for natural gas is rising as a bridge for moving towards a low-carbon economy, but whether natural gas and renewable energy represent substitutes in the global energy mix remains underexplored. We tackle this concern by examining the impact of renewable policies on international trade in liquified natural gas (LNG) among 1359 trading partners during the period 1988–2017. We measure renewable energy policies based on the ratio of renewable energy to total energy usage in importing trading partners, which also corresponds to a proxy for energy transition policies. The analysis is conducted using a global panel dataset in a trade gravity framework by applying various econometric methods and model specifications to measure LNG trade as a dependent variable. The results show that the energy transition, measured by the share of renewable energy, has a negative impact on LNG trade. This suggests that investing in cleaner energy technologies can reduce LNG trade globally, as a channel towards reducing natural gas demand. The results are consistent with the narrative where natural gas and renewable energy represent partial substitutes at the global level. However, subgroup analysis suggests that less-developed economies and the shale revolution period seem to impede progress towards the energy transition.     

The embodied energy in trade: What role does specialization play?

Many industrialized countries are net importers of embodied energy and emissions, while many developing countries are net exporters. We examine the role of specialization in driving these trade patterns by conducting a spatial index decomposition analysis on the embodied energy in net exports for 41 economies. The results reveal that industrialized countries have generally offshored energy intensive production, which many developing countries specialize in. We find that specialization, on average, makes the biggest contribution, accounting for roughly 50% of a country's embodied energy in net exports. However, other factors, namely energy intensity and the trade balance, combine to make an equally important contribution. In summary, specialization, despite its significant role, is not the only cause of the embodied energy trade patterns observed between industrialized and developing countries.     

Does electricity price matter for innovation in renewable energy technologies in China?

Though the development of renewable energy is rapid, innovation in renewable energy technologies is relatively weak due to the late commencement of renewable energy in China. In addition, renewable energy is mainly introduced into the supply mix of electricity generation, which increases the costs of electricity generation. Higher electricity price will make renewable energy more competitive and call forth renewable energy technological innovation. Based on FMOLS and DOLS models, as well as PMG model, this paper investigates the induced long and short run effects of electricity price, funding support, and economic growth on innovation in renewable energy technologies at the provincial level in China during the period 2006–2016. The Conclusions drawn were: (1) R&D expenditure and economic growth have positive impacts on innovation in renewable energy technologies in the long and short run; (2) Electricity price only has a long run effect on patenting in renewable energy technologies; (3) In the long run, a 1% increase in electricity price can lead to a 0.7825%–1.0952% increase in the patent counts of renewable energy technologies; (4) Electricity pricing system in China does not play any role in driving renewable energy technological innovation in the short run.     

Overcoming problems in Turkey's renewable energy policy: How can EU contribute?

Fossil fuels cover most of the energy demand in the world, and this creates significant social, economic and environmental problems. Many countries have taken measures to increase the share of renewable energy sources (RES), especially in electricity generation, and the review of literature shows that the success of a country in RES diffusion depends on a comprehensive renewable energy policy which combines political commitment with stable and long-term support measures that stimulate technological innovation. As the largest economy in the world, EU has also taken steps to increase RES usage in electricity generation in member states. Similar to other developing countries, Turkey is learning lessons from EU experiences regarding RES policies, and Turkey is also reforming its legal framework in line with acquis communautaire as a candidate country. As a result, EU has a multiway impact on Turkey's renewable energy policy. An overview of Turkey's renewable energy policy showed that EU has significantly contributed to Turkey in shaping its renewable energy policy, and Turkey should increase cooperation with EU in order to utilize its renewable energy potential.     

Analysis of renewable energy progress in the western Balkan countries: Bosnia–Herzegovina and Serbia

Within the framework of achieving the European environmental targets towards climate change mitigation, as well as decreasing the fossil fuel dependence and its negative effects on global warming, renewable energy sources (RES) promotion has become a major issue of concern in most European Union (EU) countries. In the above context, most EU countries have endorsed initiatives to foster RES implementation development and inclusion in the energy mix, aiming to endeavor and further impel the benefits deriving from RES and harmonize to the EU Directive or Kyoto Protocol. Nevertheless, only few sporadic efforts have been examining countries and compare the requirements for promoting RES implementation that lack specific RES obligations or a framework set by the Kyoto Protocol or the EU Directive, and particular Balkans countries with great RES potential, such as BiH and Serbia. The main objective of this paper is to analyze the conditions and modalities for RES progress within the economic, political and institutional dimension, in these two neighboring countries located in the vicinity of EU Member States (MS), which appear to have a similar historical, political and economical background and an extensive RES potential. The analysis indicated that RES development in BiH seems to be a slow process, its institutional framework is partly established and further strengthening is required. In Serbia, the institutional framework is efficiently established, are in the process of developing new legislation to facilitate renewable energy development.     

China’s emissions embodied in exports: How regional and trade heterogeneity matter

Trade facilitates the shifts of emissions from one place to another. Although studies have shown that regionally disaggregated model and model that distinguishes processing exports at the national level are necessary to estimate the embodied emissions in China's exports, no study evaluates this issue by simultaneously taking both regional and trade heterogeneity into account. To fill this gap, we re-estimate the CO₂ emissions embodied in China’s exports at both regional and industrial level, by using the newly-developed inter-regional input-output (IRIOP) model that distinguishes processing trade from other trade at the regional level. Results show that compared to the IRIOP model, the traditional multi-regional input-output (MRIO) model has overestimated the environmental loss from exports by 14%–25% in 2002 and 7%–20% in 2012 for different regions. The largest bias is found in regions and industries with the highest processing export shares. Therefore, the IRIOP model gives more accurate accounting on the regional environmental loss due to national exports and thus is important for establishing effective emission mitigation policies.     

Why invest in wind energy? Career incentives and Chinese renewable energy politics

We study wind development at the provincial level in China, modelling installed wind capacities as a function of both economics and politics. We assume that the top provincial officials desire to maximize their chances of promotion under the Chinese cadre evaluation system. We expect that those with the strongest incentives to perform in order to achieve promotion would work harder to comply with the central government’s policy agenda to promote renewable energy. Collecting and testing data on provincial leaders’ characteristics, we find that provinces governed by party secretaries who were approaching the age of 65 are associated with significantly higher level of wind installed capacities. This result supports the political tournaments theory of Chinese politics. We also find that better educated party secretaries are likely to be more supportive of renewable energy, implying that education acts to encourage provincial leaders to support the central government’s policy.     

Investigation of the environmental Kuznets curve for carbon emissions in Malaysia: Do foreign direct investment and trade matter?

Environmental degradation has become a central issue of discussion among the economists and environmentalists. In view of Malaysia's position as one of the main contributors to CO₂ emissions in Asia and its status as a fast growing economy, it is vital, therefore, to conduct a study to identify the relationship between economic growth and CO₂ emissions for Malaysia. This study attempts to examine empirically the environmental Kuznets curve hypothesis for Malaysia in the presence of foreign direct investment and trade openness both in the short- and long-run for the period 1970 to 2008.The bounds testing approach and Granger causality methodology are applied to test the interrelationships of the variables. The results of our study indicate that the inverted-U shaped relationship does exist between economic growth and CO₂ emission in both the short- and long-run for Malaysia after controlling for two additional explanatory variables, namely FDI and trade. Importantly, the results of the study also provide some crucial policy recommendations to the policy makers.     

Hydropower–water and renewable energy in Turkey: Sources and policy

Turkey's energy consumption has been growing much faster than its production. It forces Turkey to make a rapid action to supply energy demand. From the viewpoint of primary energy sources (petroleum and natural gas), Turkey is not a rich country, but it has an abundant hydropower potential to be used for generation of electricity. Hydropower is the most important kind of renewable, sustainable energy and a proven technology for electricity generation. The aim of this paper is to discuss sources and policy of hydropower, water and renewable energy in Turkey and compares the hydropower application with Europe.     

The pollution concern in the era of globalization: Do the contribution of foreign direct investment and trade openness matter?

This analysis aims to treat the contribution of the foreign direct investment inflows and trade openness to environmental degradation. Drawing on the data for 27 African countries over the period from 1990 to 2013, we develop an empirical model based on a set of panel methods. This approach includes Westerlund (2007) panel cointegration technic, Common Correlated Effects Mean Group (CCE-MG) estimation procedure, and the Granger causality test. In terms of long-term causality, our findings reveal bidirectional long-term causality between CO₂/NO_x emissions, GDP, trade openness, and foreign direct investment. Besides, in the short-run, the results recorded a unidirectional causality running from GDP to CO₂, and from FDI to CO₂. However, bidirectional causality nexus was detected between trade openness and CO₂. Additionally, the findings portray bidirectional causality between GDP and NO_x and between trade openness and NO_x, while a unidirectional causality from foreign direct investment to NO_x. Our analysis substantiates the importance of the foreign direct investment inflows and trade openness in mitigating the adverse effect of heavy pollutant activities and resolving the environmental puzzle (growing without polluting) consistent with the Millennium Development Goals (MGDs) of the UN background.     

Do urbanization and industrialization affect energy intensity in developing countries?

Against a backdrop of concerns about climate change, peak oil, and energy security issues, reducing energy intensity is often advocated as a way to at least partially mitigate these impacts. This study uses recently developed heterogeneous panel regression techniques like mean group estimators and common correlated effects estimators to model the impact that income, urbanization and industrialization has on energy intensity for a panel of 76 developing countries. In the long-run, a 1% increase in income reduces energy intensity by − 0.45% to − 0.35%. Long-run industrialization elasticities are in the range 0.07 to 0.12. The impact of urbanization on energy intensity is mixed. In specifications where the estimated coefficient on urbanization is statistically significant, it is slightly larger than unity. The implications of these results for energy policy are discussed.     

How to stimulate renewable energy power generation effectively? – China's incentive approaches and lessons

The renewable energy power generation (REPG) in China has experienced tremendous growth in the last decade. To understand this rapid growth, it is necessary to explore how Chinese government triggers the remarkable development of the industry. This paper offers a systematic analysis of the incentive policy system for REPG in China, covering wind power, solar photovoltaic, small hydropower (single-unit power generation capacity less than 50 MW), biomass power and geothermal power. The incentive system contains laws, regulations, policies and industrial plans issued during the 11th and 12th “Five-year Plan” periods (2006–2015). Four major incentive strategies of the Chinese government are identified: research and development incentives, fiscal and tax incentives, grid-connection and tariff incentives, and market development incentives. The results show these incentive methods have played a significant role in promoting the development of REPG in China, but still there are some problems associated with them. International comparisons of the incentive policies with those of Denmark, Germany and US, as well as the strategies to further improve the Chinese incentive approaches are discussed. This comprehensive analysis of China's incentive policy system for REPG helps to understand China's experience in promoting renewable energy, contributing to better decision-making in policy.     

Community renewable energy: What should it mean?

Community is a much used word that is readily attached to projects, initiatives and policies as part of the discursive politics of modern governance. In this viewpoint, we consider the way in which community has become attached to renewable energy projects in the UK, both in grassroot action and in mainstream energy policy. We ask what those involved have seen as distinctive about community renewable energy projects that makes them different from other renewable energy installations. We identify a diversity of understandings and interpretations that revolve around questions of both process (who the project is by) and outcome (who the project is for). We evaluate the implications of this diversity, identifying the importance of the process of project development for realising the catalytic and learning effects of meaningful and substantial local involvement.     

How does tax system on energy industries affect energy demand,CO2 emissions,and economy in China?

Energy savings and CO₂ emission reduction have become a major issue in recent years. Taxes on energy production sectors may be an effective way to save energy, reduce CO₂ emissions, and improve environmental quality. This paper constructs a dynamic recursive Computable General Equilibrium (CGE) model to analyze the impact of the energy tax on energy, economy, and environment from the perspective of tax rates and tax forms (specific tax and ad valorem tax). The results show that adjusting the tax system and the tax rate has important implications for energy conservation while having minor impacts on the output of other industries. The impact of an increasing energy tax on the energy demand is greater than the impact on sectoral output, indicating that energy efficiency will be increased to some extent. The CO₂ reduction will increase over time when an ad valorem tax is implemented on enterprises. We found that ad valorem tax has greater elasticity of economic output, energy demand, and CO₂ emission reduction. The results support the direction of China's resource tax reform. However, we argue that it is better to increase the tax rate relatively and relax the control on energy prices so that energy efficiency will increase.     

The impact of government subsidies and enterprises’ R&D investment: A panel data study from renewable energy in China

In this research, we aim to understand the influence of government subsidies on enterprises’ research and development (R&D) investment behavior, particularly in China’s renewable energy sector. We are also interested in examining how the attributes of enterprise ownership act as a moderating variable for the relationship between government subsidies and R&D investment behavior. Three classical panel data analysis models including the pooled ordinary least squares (OLS) model, the fixed effect model and the random effect model are employed. We find that government subsidies have a significant crowding out influence on enterprises’ R&D investment behavior and that the influence is further moderated by the attributes of enterprise ownership. Moreover, a panel threshold regression model is used to demonstrate how the influence of government subsidies on enterprises’ R&D investment behavior will change when government subsidies increase. Two thresholds, 0.6% and 10.1%, are identified. We recommend that relevant government departments should motivate enterprise R&D investment behavioral intention by increasing subsidies within a certain range. Different attributes of enterprise ownership should also be considered as part of policy reform and re-structuring relating to government subsidies.     

Industry location in Chinese provinces: Does energy abundance matter?

We identify the driving factors of manufacturing activity across Chinese provinces with a particular focus on energy endowments. A model of production location is estimated, including both comparative advantage and economic geography determinants. The data set used consists of a panel of 28 Chinese provinces and 12 manufacturing industries over the period 1999–2009. Results confirm the relative importance of energy endowments. We find that larger energy endowments are significantly correlated with larger production of energy-intensive sectors. Disaggregation across energy carriers shows that coal exhibits the strongest impact. These results are robust across alternatives.     

Does energy efficiency improve technological change and economic growth in developing countries?

Does a trade-off exist between energy efficiency and economic growth? This question underlies some of the tensions between economic and environmental policies, especially in developing countries that often need to expand their industrial base to grow. This paper contributes to the debate by analyzing the relationship between energy efficiency and economic performance at the micro- (total factor productivity) and macro-level (countries' economic growth). It uses data on a large sample of manufacturing firms across 29 developing countries to find that lower levels of energy intensity are associated with higher total factor productivity for the majority of these countries. The results are robust to a variety of checks. Suggestive cross-country evidence points towards the same relation measured at the macro-level as well.     

What proportion of renewable energy supplies is needed to initially mitigate CO2 emissions in OECD member countries?

In spite of increasing numbers of countries having established renewable energy development mechanisms for carbon dioxide (CO₂) emissions reduction, the CO₂ emissions problem continues to worsen along with the growth of the world economy. This leads us to examine the threshold effect of the proportion of renewable energy supply for CO₂ emissions reduction by means of the panel threshold regression model (PTR). Economic growth and the price of energy are also both taken into account in the model in measuring the specific influence that each of them has on CO₂ emissions. The empirical panel data encompass all 30 member countries of the OECD and cover a period of about a decade in length from 1996 to 2005. Our empirical results provide clear evidence of the existence of a single threshold effect that may be divided into lower and higher regimes. Based on the specific estimates of the slope coefficients in each regime distinguished, we find that a renewable energy supply accounting for at least 8.3889% of total energy supply would mean that CO₂ emissions would start to be mitigated. Furthermore, real GDP and the CPI of energy are significantly and positively and insignificantly and negatively correlated with CO₂ emissions, respectively. These findings lead us to conclude that the authorities ought to enhance the proportion of renewable energy supply to more than 8.3889% of all energy supplied, which might help resolve the dilemma between economic growth and CO₂ emissions. Realizing the effects of CO₂ emissions reduction via energy price reforms or the levying of a carbon tax levy may, however, still remain a puzzle.     

Does FDI influence renewable energy consumption? An analysis of sectoral FDI impact on renewable and non-renewable industrial energy consumption

This study examines the link between foreign direct investment (FDI) and energy demand. FDI is a source of financing that allows businesses to grow. At the same time, FDI can be a source of innovation that promotes energy efficiency. Existing evidence on the impact of aggregate FDI inflows on energy consumption is scarce and inconclusive. In the current study, we disaggregate FDI inflows into mining, manufacturing, total services, and financial services components and examine the impact of these FDI flows on renewable – and non-renewable industrial energy – sources for 74 countries for the period 1985–2012. We employ a Blundell–Bond dynamic panel estimator to control for endogeneity and omitted variable biases in our panels. The results point broadly to an energy consumption-reducing effect with respect to non-renewable sources of energy and an energy consumption-augmenting effects with respect to renewable energy. We find that these effects vary in magnitude and significance by sectoral FDI.