IDEAS home Printed from https://ideas.repec.org/a/eee/rensus/v41y2015icp1465-1477.html
   My bibliography  Save this article

Rich enough to go renewable, but too early to leave fossil energy?

Author

Listed:
  • Menegaki, Angeliki N.
  • Tsagarakis, Konstantinos P.

Abstract

Typically environmental Kuznets curve (EKC) studies on energy concentrate on the emissions produced from energy production or consumption and neglect the aspect of exhaustion of a natural resource, which is an irreversible result, against any definition of sustainability and intergenerational equity. This paper investigates whether there is an environmental Kuznets curve for renewable energy, whether there should be one and if there is, what it should stand for. For this reason the paper employs balanced panel data for 33 European member and candidate state countries that produce crude oil, natural gas, coal and renewable energy for the years 1990–2010 to investigate the relationship between their scale of economic activity, fossil energy production and the production of renewable energy. Results from random effects models together with Arellano Bond estimator models identify the U-shape for the environmental Kuznets curve only for renewable energy and coal production. A theoretical justification on the mechanisms possibly driving the environmental Kuznets curve for renewable energy are also discussed.

Suggested Citation

  • Menegaki, Angeliki N. & Tsagarakis, Konstantinos P., 2015. "Rich enough to go renewable, but too early to leave fossil energy?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 41(C), pages 1465-1477.
    • Handle: RePEc:eee:rensus:v:41:y:2015:i:c:p:1465-1477
    DOI: 10.1016/j.rser.2014.09.038
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1364032114008119
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.rser.2014.09.038?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kjarstad, Jan & Johnsson, F., 2007. "Prospects of the European gas market," Energy Policy, Elsevier, vol. 35(2), pages 869-888, February.
    2. Wiser, Ryan & Bolinger, Mark, 2007. "Can deployment of renewable energy put downward pressure on natural gas prices?," Energy Policy, Elsevier, vol. 35(1), pages 295-306, January.
    3. Alok Bhargava & J. D. Sargan, 2006. "Estimating Dynamic Random Effects Models From Panel Data Covering Short Time Periods," World Scientific Book Chapters, in: Econometrics, Statistics And Computational Approaches In Food And Health Sciences, chapter 1, pages 3-27, World Scientific Publishing Co. Pte. Ltd..
    4. Menegaki, Angeliki N., 2011. "Growth and renewable energy in Europe: A random effect model with evidence for neutrality hypothesis," Energy Economics, Elsevier, vol. 33(2), pages 257-263, March.
    5. Lantz, Van, 2002. "Is there an Environmental Kuznets Curve for clearcutting in Canadian forests?," Journal of Forest Economics, Elsevier, vol. 8(3), pages 199-212.
    6. Shahbaz, Muhammad & Khan, Saleheen & Tahir, Mohammad Iqbal, 2013. "The dynamic links between energy consumption, economic growth, financial development and trade in China: Fresh evidence from multivariate framework analysis," Energy Economics, Elsevier, vol. 40(C), pages 8-21.
    7. Stern, David I., 2004. "The Rise and Fall of the Environmental Kuznets Curve," World Development, Elsevier, vol. 32(8), pages 1419-1439, August.
    8. Jobert, Thomas & Karanfil, Fatih & Tykhonenko, Anna, 2012. "Environmental Kuznets curve for carbon dioxide emissions: lack of robustness to heterogeneity?," GIAM Working Papers 12-7, Galatasaray University Economic Research Center.
    9. Zhou, Xianbo & Li, Kui-Wai, 2011. "Inequality and development: Evidence from semiparametric estimation with panel data," Economics Letters, Elsevier, vol. 113(3), pages 203-207.
    10. Suri, Vivek & Chapman, Duane, 1998. "Economic growth, trade and energy: implications for the environmental Kuznets curve," Ecological Economics, Elsevier, vol. 25(2), pages 195-208, May.
    11. Aguilera, Roberto F. & Ripple, Ronald D., 2012. "Technological progress and the availability of European oil and gas resources," Applied Energy, Elsevier, vol. 96(C), pages 387-392.
    12. Fodha, Mouez & Zaghdoud, Oussama, 2010. "Economic growth and pollutant emissions in Tunisia: An empirical analysis of the environmental Kuznets curve," Energy Policy, Elsevier, vol. 38(2), pages 1150-1156, February.
    13. Grossman, G.M & Krueger, A.B., 1991. "Environmental Impacts of a North American Free Trade Agreement," Papers 158, Princeton, Woodrow Wilson School - Public and International Affairs.
    14. T. S. Breusch & A. R. Pagan, 1980. "The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(1), pages 239-253.
    15. Cole, Matthew A., 2007. "Corruption, income and the environment: An empirical analysis," Ecological Economics, Elsevier, vol. 62(3-4), pages 637-647, May.
    16. Esteve, Vicente & Tamarit, Cecilio, 2012. "Threshold cointegration and nonlinear adjustment between CO2 and income: The Environmental Kuznets Curve in Spain, 1857–2007," Energy Economics, Elsevier, vol. 34(6), pages 2148-2156.
    17. Menegaki, Angeliki N., 2012. "A social marketing mix for renewable energy in Europe based on consumer stated preference surveys," Renewable Energy, Elsevier, vol. 39(1), pages 30-39.
    18. Gene M. Grossman & Alan B. Krueger, 1995. "Economic Growth and the Environment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(2), pages 353-377.
    19. He, Jie & Richard, Patrick, 2010. "Environmental Kuznets curve for CO2 in Canada," Ecological Economics, Elsevier, vol. 69(5), pages 1083-1093, March.
    20. Kosenius, Anna-Kaisa & Ollikainen, Markku, 2013. "Valuation of environmental and societal trade-offs of renewable energy sources," Energy Policy, Elsevier, vol. 62(C), pages 1148-1156.
    21. Esmaeili, Abdoulkarim & Abdollahzadeh, Negar, 2009. "Oil exploitation and the environmental Kuznets curve," Energy Policy, Elsevier, vol. 37(1), pages 371-374, January.
    22. Menegaki, Angeliki N. & Ozturk, Ilhan, 2013. "Growth and energy nexus in Europe revisited: Evidence from a fixed effects political economy model," Energy Policy, Elsevier, vol. 61(C), pages 881-887.
    23. Sadorsky, Perry, 2009. "Renewable energy consumption, CO2 emissions and oil prices in the G7 countries," Energy Economics, Elsevier, vol. 31(3), pages 456-462, May.
    24. Toklu, E., 2013. "Overview of potential and utilization of renewable energy sources in Turkey," Renewable Energy, Elsevier, vol. 50(C), pages 456-463.
    25. Shahbaz, Muhammad & Hye, Qazi Muhammad Adnan & Tiwari, Aviral Kumar & Leitão, Nuno Carlos, 2013. "Economic growth, energy consumption, financial development, international trade and CO2 emissions in Indonesia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 25(C), pages 109-121.
    26. Philippe Aghion & Patrick Bolton, 1997. "A Theory of Trickle-Down Growth and Development," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 64(2), pages 151-172.
    27. Hirsch, Robert L., 2008. "Mitigation of maximum world oil production: Shortage scenarios," Energy Policy, Elsevier, vol. 36(2), pages 881-889, February.
    28. Saboori, Behnaz & Sulaiman, Jamalludin, 2013. "Environmental degradation, economic growth and energy consumption: Evidence of the environmental Kuznets curve in Malaysia," Energy Policy, Elsevier, vol. 60(C), pages 892-905.
    29. Söderbergh, Bengt & Jakobsson, Kristofer & Aleklett, Kjell, 2009. "European energy security: The future of Norwegian natural gas production," Energy Policy, Elsevier, vol. 37(12), pages 5037-5055, December.
    30. Daron Acemoglu & James A. Robinson, 2002. "The Political Economy of the Kuznets Curve," Review of Development Economics, Wiley Blackwell, vol. 6(2), pages 183-203, June.
    31. Jie He, 2007. "Is the Environmental Kuznets Curve hypothesis valid for developing countries? A survey," Cahiers de recherche 07-03, Departement d'économique de l'École de gestion à l'Université de Sherbrooke.
    32. Panayotou T., 1993. "Empirical tests and policy analysis of environmental degradation at different stages of economic development," ILO Working Papers 992927783402676, International Labour Organization.
    33. World Bank, 2012. "World Development Indicators 2012," World Bank Publications - Books, The World Bank Group, number 6014, December.
    34. Abbasi, S. A. & Abbasi, Naseema, 2000. "The likely adverse environmental impacts of renewable energy sources," Applied Energy, Elsevier, vol. 65(1-4), pages 121-144, April.
    35. Menegaki, Angeliki N., 2013. "Growth and renewable energy in Europe: Benchmarking with data envelopment analysis," Renewable Energy, Elsevier, vol. 60(C), pages 363-369.
    36. Bhattarai, Madhusudan & Hammig, Michael, 2001. "Institutions and the Environmental Kuznets Curve for Deforestation: A Crosscountry Analysis for Latin America, Africa and Asia," World Development, Elsevier, vol. 29(6), pages 995-1010, June.
    37. Tzimas, Evangelos & Peteves, Stathis D., 2005. "The impact of carbon sequestration on the production cost of electricity and hydrogen from coal and natural-gas technologies in Europe in the medium term," Energy, Elsevier, vol. 30(14), pages 2672-2689.
    38. McPherson, Michael A. & Nieswiadomy, Michael L., 2005. "Environmental Kuznets curve: threatened species and spatial effects," Ecological Economics, Elsevier, vol. 55(3), pages 395-407, November.
    39. Kijima, Masaaki & Nishide, Katsumasa & Ohyama, Atsuyuki, 2010. "Economic models for the environmental Kuznets curve: A survey," Journal of Economic Dynamics and Control, Elsevier, vol. 34(7), pages 1187-1201, July.
    40. Caviglia-Harris, Jill L. & Chambers, Dustin & Kahn, James R., 2009. "Taking the "U" out of Kuznets: A comprehensive analysis of the EKC and environmental degradation," Ecological Economics, Elsevier, vol. 68(4), pages 1149-1159, February.
    41. Marwede, Max & Berger, Wolfgang & Schlummer, Martin & Mäurer, Andreas & Reller, Armin, 2013. "Recycling paths for thin-film chalcogenide photovoltaic waste – Current feasible processes," Renewable Energy, Elsevier, vol. 55(C), pages 220-229.
    42. Chiabrando, Roberto & Fabrizio, Enrico & Garnero, Gabriele, 2009. "The territorial and landscape impacts of photovoltaic systems: Definition of impacts and assessment of the glare risk," Renewable and Sustainable Energy Reviews, Elsevier, vol. 13(9), pages 2441-2451, December.
    43. Höök, Mikael & Aleklett, Kjell, 2008. "A decline rate study of Norwegian oil production," Energy Policy, Elsevier, vol. 36(11), pages 4262-4271, November.
    44. Nakhle, Carole, 2007. "Do high oil prices justify an increase in taxation in a mature oil province? The case of the UK continental shelf," Energy Policy, Elsevier, vol. 35(8), pages 4305-4318, August.
    45. Duarte, Rosa & Pinilla, Vicente & Serrano, Ana, 2013. "Is there an environmental Kuznets curve for water use? A panel smooth transition regression approach," Economic Modelling, Elsevier, vol. 31(C), pages 518-527.
    46. Orubu, Christopher O. & Omotor, Douglason G., 2011. "Environmental quality and economic growth: Searching for environmental Kuznets curves for air and water pollutants in Africa," Energy Policy, Elsevier, vol. 39(7), pages 4178-4188, July.
    47. Çapik, Mehmet & Yılmaz, Ali Osman & Çavuşoğlu, İbrahim, 2012. "Present situation and potential role of renewable energy in Turkey," Renewable Energy, Elsevier, vol. 46(C), pages 1-13.
    48. Carole Nakhle, 2007. "Do High Oil Prices Justify an Increase in Taxation in a Mature Oil Province? The Case of the UK Continental Shelf," Surrey Energy Economics Centre (SEEC), School of Economics Discussion Papers (SEEDS) 116, Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.
    49. Saidur, R. & Rahim, N.A. & Islam, M.R. & Solangi, K.H., 2011. "Environmental impact of wind energy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(5), pages 2423-2430, June.
    50. Lindert, Peter H, 1986. "Unequal English Wealth since 1670," Journal of Political Economy, University of Chicago Press, vol. 94(6), pages 1127-1162, December.
    51. Mills, Julianne H. & Waite, Thomas A., 2009. "Economic prosperity, biodiversity conservation, and the environmental Kuznets curve," Ecological Economics, Elsevier, vol. 68(7), pages 2087-2095, May.
    52. Choumert, Johanna & Combes Motel, Pascale & Dakpo, Hervé K., 2013. "Is the Environmental Kuznets Curve for deforestation a threatened theory? A meta-analysis of the literature," Ecological Economics, Elsevier, vol. 90(C), pages 19-28.
    53. Dinda, Soumyananda, 2004. "Environmental Kuznets Curve Hypothesis: A Survey," Ecological Economics, Elsevier, vol. 49(4), pages 431-455, August.
    54. Luzzati, T. & Orsini, M., 2009. "Investigating the energy-environmental Kuznets curve," Energy, Elsevier, vol. 34(3), pages 291-300.
    55. Bergmann, Ariel & Colombo, Sergio & Hanley, Nick, 2008. "Rural versus urban preferences for renewable energy developments," Ecological Economics, Elsevier, vol. 65(3), pages 616-625, April.
    56. Krozer, Yoram, 2013. "Cost and benefit of renewable energy in the European Union," Renewable Energy, Elsevier, vol. 50(C), pages 68-73.
    57. Sundqvist, Thomas, 2004. "What causes the disparity of electricity externality estimates?," Energy Policy, Elsevier, vol. 32(15), pages 1753-1766, October.
    58. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    59. AkbostancI, Elif & Türüt-AsIk, Serap & Tunç, G. Ipek, 2009. "The relationship between income and environment in Turkey: Is there an environmental Kuznets curve?," Energy Policy, Elsevier, vol. 37(3), pages 861-867, March.
    60. Saboori, Behnaz & Sulaiman, Jamalludin & Mohd, Saidatulakmal, 2012. "Economic growth and CO2 emissions in Malaysia: A cointegration analysis of the Environmental Kuznets Curve," Energy Policy, Elsevier, vol. 51(C), pages 184-191.
    61. Johanna Choumert & Pascale Combes Motel & K. Hervé Dakpo, 2013. "Is the Environmental Kuznets Curve for deforestation a threatened theory? A meta-analysis of the literature," Post-Print halshs-00806629, HAL.
    62. Fosten, Jack & Morley, Bruce & Taylor, Tim, 2012. "Dynamic misspecification in the environmental Kuznets curve: Evidence from CO2 and SO2 emissions in the United Kingdom," Ecological Economics, Elsevier, vol. 76(C), pages 25-33.
    63. Lee, Chien-Chiang & Chiu, Yi-Bin & Sun, Chia-Hung, 2010. "The environmental Kuznets curve hypothesis for water pollution: Do regions matter?," Energy Policy, Elsevier, vol. 38(1), pages 12-23, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Muhammad Shahbaz & Avik Sinha, 2019. "Environmental Kuznets curve for CO2emissions: a literature survey," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 46(1), pages 106-168, January.
    2. Pablo-Romero, María del P. & De Jesús, Josué, 2016. "Economic growth and energy consumption: The Energy-Environmental Kuznets Curve for Latin America and the Caribbean," Renewable and Sustainable Energy Reviews, Elsevier, vol. 60(C), pages 1343-1350.
    3. Shahbaz, Muhammad & Sinha, Avik, 2019. "Environmental Kuznets Curve for CO2 emission: A survey of empirical literature," MPRA Paper 100257, University Library of Munich, Germany, revised 2019.
    4. Tiba, Sofien & Omri, Anis, 2017. "Literature survey on the relationships between energy, environment and economic growth," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 1129-1146.
    5. Sofien, Tiba & Omri, Anis, 2016. "Literature survey on the relationships between energy variables, environment and economic growth," MPRA Paper 82555, University Library of Munich, Germany, revised 14 Sep 2016.
    6. Iftikhar Yasin & Nawaz Ahmad & M. Aslam Chaudhary, 2020. "Catechizing the Environmental-Impression of Urbanization, Financial Development, and Political Institutions: A Circumstance of Ecological Footprints in 110 Developed and Less-Developed Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 147(2), pages 621-649, January.
    7. Bilgili, Faik & Koçak, Emrah & Bulut, Ümit, 2016. "The dynamic impact of renewable energy consumption on CO2 emissions: A revisited Environmental Kuznets Curve approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 838-845.
    8. Muhammad Bilal Khan & Hummera Saleem & Malik Shahzad Shabbir & Xie Huobao, 2022. "The effects of globalization, energy consumption and economic growth on carbon dioxide emissions in South Asian countries," Energy & Environment, , vol. 33(1), pages 107-134, February.
    9. Zhang, Qianxue & Liao, Hua & Hao, Yu, 2018. "Does one path fit all? An empirical study on the relationship between energy consumption and economic development for individual Chinese provinces," Energy, Elsevier, vol. 150(C), pages 527-543.
    10. Sabuj Kumar Mandal & Devleena Chakravarty, 2017. "Role of energy in estimating turning point of Environmental Kuznets Curve: an econometric analysis of the existing studies," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 19(2), pages 387-401, October.
    11. Hao, Yu & Zhang, Zong-Yong & Liao, Hua & Wei, Yi-Ming, 2015. "China’s farewell to coal: A forecast of coal consumption through 2020," Energy Policy, Elsevier, vol. 86(C), pages 444-455.
    12. Ben Youssef, Adel & Hammoudeh, Shawkat & Omri, Anis, 2016. "Simultaneity modeling analysis of the environmental Kuznets curve hypothesis," Energy Economics, Elsevier, vol. 60(C), pages 266-274.
    13. Daniel Armeanu & Georgeta Vintilă & Jean Vasile Andrei & Ştefan Cristian Gherghina & Mihaela Cristina Drăgoi & Cristian Teodor, 2018. "Exploring the link between environmental pollution and economic growth in EU-28 countries: Is there an environmental Kuznets curve?," PLOS ONE, Public Library of Science, vol. 13(5), pages 1-28, May.
    14. Roxana Pincheira & Felipe Zuniga, 2021. "Environmental Kuznets curve bibliographic map: a systematic literature review," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 61(S1), pages 1931-1956, April.
    15. Mrabet, Zouhair & Alsamara, Mouyad, 2017. "Testing the Kuznets Curve hypothesis for Qatar: A comparison between carbon dioxide and ecological footprint," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 1366-1375.
    16. Sofien Tiba & Mohamed Frikha, 2020. "EKC and Macroeconomics Aspects of Well-being: a Critical Vision for a Sustainable Future," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 11(3), pages 1171-1197, September.
    17. Shahbaz, Muhammad & Haouas, Ilham & Hoang, Thi Hong Van, 2019. "Economic growth and environmental degradation in Vietnam: Is the environmental Kuznets curve a complete picture?," Emerging Markets Review, Elsevier, vol. 38(C), pages 197-218.
    18. Aslan, Alper & Destek, Mehmet Akif & Okumus, İlyas, 2017. "Sectoral carbon emissions and economic growth in the US: Further evidence from rolling window estimation method," MPRA Paper 106961, University Library of Munich, Germany.
    19. Priscilla Massa-Sánchez & Luis Quintana-Romero & Ronny Correa-Quezada & María de la Cruz del Río-Rama, 2020. "Empirical Evidence in Ecuador between Economic Growth and Environmental Deterioration," Sustainability, MDPI, vol. 12(3), pages 1-20, January.
    20. Alexandra-Anca Purcel, 2020. "New insights into the environmental Kuznets curve hypothesis in developing and transition economies: a literature survey," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 22(4), pages 585-631, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:rensus:v:41:y:2015:i:c:p:1465-1477. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/600126/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.