Contribution of modern renewables to final energy consumption, energy intensity, and environmental quality: The role of world energy balances, economic performance, and shadow economies

As countries strive for sustainable development and combat climate change, the contribution of modern renewables to final energy consumption, energy intensity, and environmental quality has gained significant attention. This paper examines the impact of modern renewables' share of total final energy consumption and energy intensity on environmental quality in selected Asia-Pacific Economic Cooperation (APEC) countries from 2001 to 2023, using world energy balances, economic performance, and the shadow economy as supporting variables. The Prais–Winsten regression results, correlated panels corrected standard errors (PCSEs), indicate that world energy balances, energy intensity, and modern renewables' share of final energy consumption are negatively associated with carbon dioxide emissions. As these variables increase, carbon dioxide emissions tend to decrease. Conversely, economic growth and the shadow economy are positively associated with carbon dioxide emissions per capita. This relationship suggests that as economic growth and the shadow economy increase, carbon dioxide emissions per capita also tend to rise. APEC countries should leverage their position as major energy consumers to influence global energy balances. By promoting and adopting renewable energy technologies and efficiency measures, APEC countries can contribute to a greener and more sustainable global energy system. Collaborating with non-APEC countries may help achieve this goal.