Does renewable energy consumption reduce ecological footprint? Evidence from eight developing countries of Asia

Abstract

Economic and demographic transitions led by the persistent increase in the per capita income have challenged the environmental conservation drive in most of the developing nations. Therefore, in recent years, policymakers emphasized the need for navigating the harmful impacts of economic growth endeavors on the established ecosystem. In this regard, the widespread usage of renewable energy solutions has helped in restoring the environmental quality in both developed and developing countries. Keeping this in mind, in the present study, we examined the long run and short-run impacts of per capita income, renewable energy, life expectancy, and population density on the ecological footprint in the eight developing countries of South and Southeast Asia from 1990-2015. In the selected nations, these variables appear to be the potential drivers of the ecological footprint. To calculate the common coefficients, we have employed the cross-sectional augmented autoregressive distributed lag (CS-ARDL) approach, as this approach handles the cross-sectional dependency issue efficiently and provides the short-run and long-run coefficients. The long-run results supported the need for low pollution-intense energy resources because the association between per capita income and ecological footprint is found N-shaped. Further, the study established that the increased use of renewable energy has significantly reduced the ecological footprint in the region. However, the increased population density has led to an increase in pollution emissions in these countries. Similarly, the impact of life expectancy on the ecological footprint is found positive but insignificant. Based on the findings, a multipronged policy framework has been designed, so that these nations can attain the objectives of certain sustainable development goals (SDGs).

Renewable Energy Use and Ecological Footprints Mitigation: Evidence from Selected South Asian Economies

“…Similarly, Destek and Sinha [47] also found renewable energy use to be effective in reducing the EF of selected OECD countries. Similar findings appeared in the studies by Alola et al [54] for 16 European Union countries and Sharma et al [55] for developing countries from Asia.…”

“…Thus, it is critically important for these fossil fuel-dependent South Asian countries to adopt renewable energy technologies to resolve their environmental woes gradually. The environmental welfare impacts of renewable energy use were also documented in the studies by Destek and Sinha [47] and Sharma et al [55] for OECD and Asian countries, respectively.…”

“…Since renewable energy resources are environmentally friendly, higher renewable energy consumption can reduce the EF. Thus, the predicted elasticity parameter δ 3 can be hypothesized to have a negative sign [54,55]. The variable FDI abbreviates the percentage share of net foreign direct investment (FDI) inflows in the respective South Asian countries' GDP.…”

Carbon tax and energy innovation at crossroads of carbon neutrality: Designing a sustainable decarbonization policy

“…It might be possible that the government might not be benefitted by the firms facing lower and medium carbon tax in comparison with the firms facing higher carbon tax. This segment of the findings extends the finding of Sharma et al (2021). This might give the policymakers a direction to realign their energy policy for targeting the firms in promoting energy innovation, as firms facing lower carbon tax might not be benefitted with the higher spectrum of innovation.…”

Foreign Direct Investments, Renewable Electricity Output, and Ecological Footprints: Do Financial Globalization Facilitate Renewable Energy Transition and Environmental Welfare in Bangladesh?

“…In this regard, clean FDI is hypothesized to green the production and consumption processes within the host nations to improve the quality of the environment. Furthermore, since renewable energy use is believed to be inextricably linked to environmental development (Dogan et al, 2020 ; Nathaniel et al, 2020 ; Adedoyin et al, 2020 ; Sharma et al, 2021 ), a joint environmental impact of FDI inflows and renewable energy consumption can also be expected (Zhang & Zhou, 2016 ).…”