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Can artificial intelligence technology reduce carbon emissions? A global perspective

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  • Cao, Qingfeng
  • Chi, Chuenyu
  • Shan, Junhui

Abstract

Whether Artificial Intelligence (AI) technology can contribute to carbon reduction remains an issue that requires further research. We measure the level of AI technology by the number of AI patents filed in each country, and use panel data from 30 countries spanning 2005 to 2020 to examine the impact of AI technology on carbon emissions. Our findings indicate that AI technology significantly reduces carbon emission levels. This conclusion remains robust after endogeneity and various robustness tests. Mechanism tests reveal that AI technology improves energy efficiency by reducing per capita carbon emissions and the energy intensity of primary energy. Additionally, AI technology reduces carbon emissions by inducing skill-biased and routine-biased technological change. When government regulation is more flexible, the carbon-reducing effect of AI technology is stronger. Further analysis indicates that AI technology has a significant impact on reducing carbon emissions in countries that are closer to the leading country in AI technology, have lower income level, and are highly dependent on traditional fossil fuels. Moreover, the carbon reduction effects of AI technology applied to energy management are more significant. Thus, promoting the innovation and diffusion of AI technology on a global scale plays a crucial role in advancing global carbon reduction targets.

Suggested Citation

  • Cao, Qingfeng & Chi, Chuenyu & Shan, Junhui, 2025. "Can artificial intelligence technology reduce carbon emissions? A global perspective," Energy Economics, Elsevier, vol. 143(C).
    • Handle: RePEc:eee:eneeco:v:143:y:2025:i:c:s0140988325001082
    DOI: 10.1016/j.eneco.2025.108285
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    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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