Energy Productivity and Environmental Degradation in Germany: Evidence from Novel Fourier Approaches

Abstract

The increased consumption of fossil fuels worldwide has resulted in unprecedented historic environmental degradation and global warming. According to the United Nations, this is both the defining crisis of our time and a race the world could win given the right policy attention. Researchers seek to find critical pathways to provide policy recommendations for reducing environmental degradation. This paper aims to investigate the effect of energy productivity on environmental degradation in Germany while controlling for economic growth, primary energy consumption, and globalization for the period between 1990Q1 and 2019Q4. The outcomes of the Fourier ARDL long-run estimates indicate that (i) both energy productivity and globalization have a negative effect on carbon emissions in Germany, and (ii) both economic growth and primary energy consumption have positive effects on carbon dioxide emissions. These outcomes provide significant policy insights to EU members with respect to reducing their reliance on Russian energy imports amidst the rising energy bills and ongoing geopolitical war with Ukraine while increasing investments to realize their energy turnaround policy objectives.

The Importance of Green Investments in Developed Economies—MCDM Models for Achieving Adequate Green Investments

“…A substantial amount of funds is invested in three main areas: resources, productivity factors, and energy productivity. At the same time, they are integral parts of sustainable development strategies and sustainability policies, covering the issues of CO2 neutrality [47], resource productivity in the EU [48], and energy productivity [49]. The following important criterion in deciding to invest in the green economy or not is policy issues of sustainable development and how these policies are implemented in the labour market, education, regulations, technology, innovation, etc.…”

Strategies in Energy Supply: A Social Network Analysis on the Energy Trade of the European Union

“…Germany takes steps against the risks to energy supply security, such as intensifying its energy transition progress with the implementation of new policies. The policies aim to ensure energy productivity and a progressive transition from fossil fuels to renewable energy sources [53]. The import rates are nearly the same for France and Italy, which shows high dependency.…”

Energy productivity, financial stability, and environmental degradation in an Eastern European country: Evidence from novel Fourier approaches

“…Another variable attracting academic focus and policy interest in global carbon emissions discourse is energy productivity [ 7 , 24 , 25 ]. Energy productivity has been seen in using smart energy technologies, energy productivity funding; smart industrial development; mobility and critical smart water systems.…”

“…One of the recent findings in scholarly activity for policy focus is the recognition of the role of energy productivity in carbon emissions [ 7 ]. This is mainly due to the understanding that economies can accurately determine energy use through energy productivity metrics at low cost.…”

“…This is mainly due to the understanding that economies can accurately determine energy use through energy productivity metrics at low cost. To several scholars, energy productivity can improve the quality of the environment by reducing the volume of energy required for production and similarly ensuring a reduction in energy expenditure [ 7 , 8 ]. Experts explain energy productivity to be a measure of economic benefits on a unit of energy consumption and is usually calculated by dividing gross domestic product (GDP) growth by the quality of energy utilized.…”