Renewable Energy Consumption-Growth Nexus in European Countries: A Sectoral Approach

Abstract

The renewable energy consumption plays a significant role in achieving sustainable development, but a sectoral approach is necessary to design the better recommendations for each sector. In this context, the main objective of this paper is to assess the impact of the use of this type of energy on economic growth in 23 European Union (EU) member states in the period 1990–2020. Besides overall renewable energy consumption, different utilisations of this energy are considered: in industry, transport, in commercial and public services, and for residential purposes. The methodological background is built around panel data models that start from a Cobb–Douglas function. The renewable energy consumption is considered an important factor that should generate economic growth. The panel data approach based on causality analysis and Augmented Mean Group and Common Correlated Effects Mean Group estimators suggests that renewable energy use in industry does not determine economic growth, but economic development is a cause for more utilisation of this energy in industry. In addition, more renewable energy consumption in transport enhances economic growth. A high level of economic development can promote the consumption of renewable energies in industrial sectors. In this way, industrial companies can allocate more financial funds to research in the field of renewable energies and can afford to adopt renewable energy sources. Investment in biofuels can contribute to achieving sustainable transport in the EU.

Analyzing the Importance of the Determinants of Public Debt and Its Policy Implications: A Survey of Literature

“…There is also no consensus on the effect they have on debt. For Benito, Bastida, and Guillamón (2010), population density implies lower total spending, which would lead to lower debt levels, while Sinha, Arora, and Bansal (2011) and Balaguer-Coll, Prior, and Tortosa-Ausina (2016) found no significant effect.…”

“…Governments are driven to accumulate public debt to cover their budget deficits, having to resort to external or domestic borrowing to finance their operations. Moreover, it is highlighted that gross domestic product growth plays a crucial role, usually negatively, in the dynamics of public debt (Sinha, Arora and Bansal 2011; Bittencourt 2015; Gargouri and Ksantini 2016).…”

“…Swamy (2015), Bittencourt (2015), Filip (2019), and Nagou, Bayale, and Kouassi (2021) showed the negative effect of GDP growth on public debt, while according to González-Fernández and González-Velasco (2014), there is no significant relationship between both variables and it is positive for Forslund, Lima, and Panizza (2011). GDP growth, government spending, education spending, and current account balance are statistically significant determinants of debt in high- and middle-income countries (Sinha, Arora and Bansal 2011).…”

“…Trade openness tends to improve public debt levels by attracting foreign investors because they suffer less from the effects of imbalances associated with external indebtedness (Sinha, Arora and Bansal 2011; Swamy 2015; Omrane and Omrane 2017). Gargouri and Ksantini (2016) showed that exports do not have a significant impact on public debt, but imports have a positive influence.…”

Northern Lights: Prospecting Efficiency in Europe’s Renewable Energy Sector

“…This gap is critical as it influences the development of effective policies and the optimization of renewable energy systems for maximum productivity and sustainability. A review of the existing literature reveals a proliferation of studies on renewable energy deployment, yet few delve into the nuanced analysis of conversion efficiency in the Northern European region [11][12][13][14]. This lack of detailed efficiency metrics hinders the ability to fully leverage the potential of renewable resources, necessitating a more focused and analytical approach to assess and enhance the performance of renewable energy technologies.…”