IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v204y2023icp722-732.html
   My bibliography  Save this article

Dynamic relationship among climate policy uncertainty, oil price and renewable energy consumption—findings from TVP-SV-VAR approach

Author

Listed:
  • Zhou, Deheng
  • Siddik, Abu Bakkar
  • Guo, Lili
  • Li, Houjian

Abstract

This paper collects monthly data for the United States from January 2005 to April 2021 and develops a time-varying parameter vector autoregressive model with stochastic volatility (TVP-SV-VAR) model to investigate the time-varying relationship between climate policy uncertainty, oil prices, and renewable energy consumption. In addition, this paper discusses the dynamic impact of climate policy uncertainty on five types of renewable energy consumption. Our results show that the relationship between them is time-varying. In most periods, climate policy uncertainty positively affects oil prices in the short and medium term, and positively affects total renewable energy consumption in the short and long term. In addition, the impact of climate policy uncertainty on the consumption of the five types of renewable energy is heterogeneous. The results of the robustness tests indicate that our results are robust and our study has important implications for the development of relevant policies.

Suggested Citation

  • Zhou, Deheng & Siddik, Abu Bakkar & Guo, Lili & Li, Houjian, 2023. "Dynamic relationship among climate policy uncertainty, oil price and renewable energy consumption—findings from TVP-SV-VAR approach," Renewable Energy, Elsevier, vol. 204(C), pages 722-732.
    • Handle: RePEc:eee:renene:v:204:y:2023:i:c:p:722-732
    DOI: 10.1016/j.renene.2023.01.018
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148123000241
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2023.01.018?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. Murshed, Muntasir & Ozturk, Ilhan, 2023. "Rethinking energy poverty reduction through improving electricity accessibility: A regional analysis on selected African nations," Energy, Elsevier, vol. 267(C).
    2. Shahriyar Mukhtarov & Jeyhun I. Mikayilov & Sugra Humbatova & Vugar Muradov, 2020. "Do High Oil Prices Obstruct the Transition to Renewable Energy Consumption?," Sustainability, MDPI, vol. 12(11), pages 1-16, June.
    3. Yao, Can-Zhong & Sun, Bo-Yi, 2018. "The study on the tail dependence structure between the economic policy uncertainty and several financial markets," The North American Journal of Economics and Finance, Elsevier, vol. 45(C), pages 245-265.
    4. Sadorsky, Perry, 2009. "Renewable energy consumption and income in emerging economies," Energy Policy, Elsevier, vol. 37(10), pages 4021-4028, October.
    5. Duraisamy Pachiyappan & Yasmeen Ansari & Md Shabbir Alam & Prabha Thoudam & Kuppusamy Alagirisamy & Palanisamy Manigandan, 2021. "Short and Long-Run Causal Effects of CO 2 Emissions, Energy Use, GDP and Population Growth: Evidence from India Using the ARDL and VECM Approaches," Energies, MDPI, vol. 14(24), pages 1-17, December.
    6. Huang, Jianbai & Dong, Xuesong & Chen, Jinyu & Zhong, Meirui, 2022. "Do oil prices and economic policy uncertainty matter for precious metal returns? New insights from a TVP-VAR framework," International Review of Economics & Finance, Elsevier, vol. 78(C), pages 433-445.
    7. Chen, Xia & Rahaman, Md Atikur & Murshed, Muntasir & Mahmood, Haider & Hossain, Md Afzal, 2023. "Causality analysis of the impacts of petroleum use, economic growth, and technological innovation on carbon emissions in Bangladesh," Energy, Elsevier, vol. 267(C).
    8. Abdul Rehman & Hengyun Ma & Ilhan Ozturk & Muntasir Murshed & Vishal Dagar, 2021. "The dynamic impacts of CO2 emissions from different sources on Pakistan’s economic progress: a roadmap to sustainable development," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(12), pages 17857-17880, December.
    9. Guo, Jiaqi & Long, Shaobo & Luo, Weijie, 2022. "Nonlinear effects of climate policy uncertainty and financial speculation on the global prices of oil and gas," International Review of Financial Analysis, Elsevier, vol. 83(C).
    10. Shafiullah, Muhammad & Miah, Mohammad Dulal & Alam, Md Samsul & Atif, Muhammad, 2021. "Does economic policy uncertainty affect renewable energy consumption?," Renewable Energy, Elsevier, vol. 179(C), pages 1500-1521.
    11. Anton, Sorin Gabriel & Afloarei Nucu, Anca Elena, 2020. "The effect of financial development on renewable energy consumption. A panel data approach," Renewable Energy, Elsevier, vol. 147(P1), pages 330-338.
    12. Lin, Boqiang & Moubarak, Mohamed, 2014. "Renewable energy consumption – Economic growth nexus for China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 40(C), pages 111-117.
    13. Bouri, Elie & Iqbal, Najaf & Klein, Tony, 2022. "Climate policy uncertainty and the price dynamics of green and brown energy stocks," Finance Research Letters, Elsevier, vol. 47(PB).
    14. Lin, Boqiang & Bai, Rui, 2021. "Oil prices and economic policy uncertainty: Evidence from global, oil importers, and exporters’ perspective," Research in International Business and Finance, Elsevier, vol. 56(C).
    15. Scott R. Baker & Nicholas Bloom & Steven J. Davis, 2016. "Measuring Economic Policy Uncertainty," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(4), pages 1593-1636.
    16. Yang, Cai & Niu, Zibo & Gao, Wang, 2022. "The time-varying effects of trade policy uncertainty and geopolitical risks shocks on the commodity market prices: Evidence from the TVP-VAR-SV approach," Resources Policy, Elsevier, vol. 76(C).
    17. Zhao, Jing & Sinha, Avik & Inuwa, Nasiru & Wang, Yihan & Murshed, Muntasir & Abbasi, Kashif Raza, 2022. "Does structural transformation in economy impact inequality in renewable energy productivity? Implications for sustainable development," Renewable Energy, Elsevier, vol. 189(C), pages 853-864.
    18. Rıdvan Karacan & Shahriyar Mukhtarov & İsmail Barış & Aykut İşleyen & Mehmet Emin Yardımcı, 2021. "The Impact of Oil Price on Transition toward Renewable Energy Consumption? Evidence from Russia," Energies, MDPI, vol. 14(10), pages 1-14, May.
    19. Muntasir Murshed & Rizwan Ahmed & Chamaiporn Kumpamool & Mohga Bassim & Mohamed Elheddad, 2021. "The effects of regional trade integration and renewable energy transition on environmental quality: Evidence from South Asian neighbors," Business Strategy and the Environment, Wiley Blackwell, vol. 30(8), pages 4154-4170, December.
    20. Khan, Samiha & Murshed, Muntasir & Ozturk, Ilhan & Khudoykulov, Khurshid, 2022. "The roles of energy efficiency improvement, renewable electricity production, and financial inclusion in stimulating environmental sustainability in the Next Eleven countries," Renewable Energy, Elsevier, vol. 193(C), pages 1164-1176.
    21. Bhattacharya, Mita & Paramati, Sudharshan Reddy & Ozturk, Ilhan & Bhattacharya, Sankar, 2016. "The effect of renewable energy consumption on economic growth: Evidence from top 38 countries," Applied Energy, Elsevier, vol. 162(C), pages 733-741.
    22. Guo, Yaoqi & Yu, Chenxi & Zhang, Hongwei & Cheng, Hui, 2021. "Asymmetric between oil prices and renewable energy consumption in the G7 countries," Energy, Elsevier, vol. 226(C).
    23. Ozcan, Burcu & Ozturk, Ilhan, 2019. "Renewable energy consumption-economic growth nexus in emerging countries: A bootstrap panel causality test," Renewable and Sustainable Energy Reviews, Elsevier, vol. 104(C), pages 30-37.
    24. Giorgio E. Primiceri, 2005. "Time Varying Structural Vector Autoregressions and Monetary Policy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 72(3), pages 821-852.
    25. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2021. "Determinants of renewable energy consumption: Importance of democratic institutions," Renewable Energy, Elsevier, vol. 179(C), pages 75-83.
    26. Shang, Yunfeng & Han, Ding & Gozgor, Giray & Mahalik, Mantu Kumar & Sahoo, Bimal Kishore, 2022. "The impact of climate policy uncertainty on renewable and non-renewable energy demand in the United States," Renewable Energy, Elsevier, vol. 197(C), pages 654-667.
    27. Liang, Chao & Umar, Muhammad & Ma, Feng & Huynh, Toan L.D., 2022. "Climate policy uncertainty and world renewable energy index volatility forecasting," Technological Forecasting and Social Change, Elsevier, vol. 182(C).
    28. Brini, Riadh & Amara, Mohamed & Jemmali, Hatem, 2017. "Renewable energy consumption, International trade, oil price and economic growth inter-linkages: The case of Tunisia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 76(C), pages 620-627.
    29. Mirzania, Pegah & Ford, Andy & Andrews, Deborah & Ofori, George & Maidment, Graeme, 2019. "The impact of policy changes: The opportunities of Community Renewable Energy projects in the UK and the barriers they face," Energy Policy, Elsevier, vol. 129(C), pages 1282-1296.
    30. Omri, Anis & Nguyen, Duc Khuong, 2014. "On the determinants of renewable energy consumption: International evidence," Energy, Elsevier, vol. 72(C), pages 554-560.
    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. Shrestha, Anil & Mustafa, Andy Ali & Htike, Myo Myo & You, Vithyea & Kakinaka, Makoto, 2022. "Evolution of energy mix in emerging countries: Modern renewable energy, traditional renewable energy, and non-renewable energy," Renewable Energy, Elsevier, vol. 199(C), pages 419-432.
    2. He, Zhifang & Dong, Tianqi & Qian, Wanchuan & Xu, Wei, 2024. "Dynamic interactions among trade policy uncertainty, climate policy uncertainty, and crude oil prices," International Review of Economics & Finance, Elsevier, vol. 95(C).
    3. Shang, Yunfeng & Han, Ding & Gozgor, Giray & Mahalik, Mantu Kumar & Sahoo, Bimal Kishore, 2022. "The impact of climate policy uncertainty on renewable and non-renewable energy demand in the United States," Renewable Energy, Elsevier, vol. 197(C), pages 654-667.
    4. Mukhtarov, Shahriyar & Mikayilov, Jeyhun I. & Maharramov, Shahin & Aliyev, Javid & Suleymanov, Elchin, 2022. "Higher oil prices, are they good or bad for renewable energy consumption: The case of Iran?," Renewable Energy, Elsevier, vol. 186(C), pages 411-419.
    5. Ghazouani, Tarek, 2022. "Dynamic impact of globalization on renewable energy consumption: Non-parametric modelling evidence," Technological Forecasting and Social Change, Elsevier, vol. 185(C).
    6. Syed, Qasim Raza & Apergis, Nicholas & Goh, Soo Khoon, 2023. "The dynamic relationship between climate policy uncertainty and renewable energy in the US: Applying the novel Fourier augmented autoregressive distributed lags approach," Energy, Elsevier, vol. 275(C).
    7. Liu, Xiaoqin & Wojewodzki, Michal & Cai, Yifei & Sharma, Satish, 2023. "The dynamic relationships between carbon prices and policy uncertainties," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    8. Xiao, Jihong & Liu, Hong, 2023. "The time-varying impact of uncertainty on oil market fear: Does climate policy uncertainty matter?," Resources Policy, Elsevier, vol. 82(C).
    9. Djula Borozan & Burak Pirgaip, 2025. "Does uncertainty in climate policy play a role in shaping renewable energy use? Evidence from the USA," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(1), pages 2259-2284, January.
    10. Esmaeili, Parisa & Rafei, Meysam & Salari, Mahmoud & Balsalobre-Lorente, Daniel, 2024. "From oil surges to renewable shifts: Unveiling the dynamic impact of supply and demand shocks in global crude oil market on U.S. clean energy trends," Energy Policy, Elsevier, vol. 192(C).
    11. Pham, Son D. & Nguyen, Thao T.T. & Do, Hung X., 2024. "Impact of climate policy uncertainty on return spillover among green assets and portfolio implications," Energy Economics, Elsevier, vol. 134(C).
    12. Leila Hedhili Zaier & Khaled Mokni & Ahdi Noomen Ajmi, 2024. "Causality relationships between climate policy uncertainty, renewable energy stocks, and oil prices: a mixed-frequency causality analysis," Future Business Journal, Springer, vol. 10(1), pages 1-11, December.
    13. Akan, Taner & Gündüz, Halil İbrahim & Emirmahmutoğlu, Furkan & Işık, Ali Haydar, 2023. "Disaggregating renewable energy-growth nexus: W-ARDL and W-Toda-Yamamoto approaches," Renewable and Sustainable Energy Reviews, Elsevier, vol. 188(C).
    14. Seyed Alireza Athari & Dervis Kirikkaleli, 2025. "How do climate policy uncertainty and renewable energy and clean technology stock prices co-move? evidence from Canada," Empirical Economics, Springer, vol. 68(1), pages 353-371, January.
    15. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2021. "Determinants of renewable energy consumption: Importance of democratic institutions," Renewable Energy, Elsevier, vol. 179(C), pages 75-83.
    16. Iqbal, Najaf & Bouri, Elie & Shahzad, Syed Jawad Hussain & Alsagr, Naif, 2024. "Asymmetric impacts of Chinese climate policy uncertainty on Chinese asset prices," Energy Economics, Elsevier, vol. 133(C).
    17. Mukhtarov, Shahriyar, 2024. "Oil prices and the renewable energy transition: Empirical evidence from China," Utilities Policy, Elsevier, vol. 91(C).
    18. Gozgor, Giray & Mahalik, Mantu Kumar & Demir, Ender & Padhan, Hemachandra, 2020. "The impact of economic globalization on renewable energy in the OECD countries," Energy Policy, Elsevier, vol. 139(C).
    19. Li, Houjian & Li, Yanjiao & Guo, Lili, 2023. "Extreme risk spillover effect and dynamic linkages between uncertainty and commodity markets: A comparison between China and America," Resources Policy, Elsevier, vol. 85(PA).
    20. Tian, Lihui & Li, Xin & Lee, Cheng-Wen & Spulbăr, Cristi, 2024. "Investigating the asymmetric impact of artificial intelligence on renewable energy under climate policy uncertainty," Energy Economics, Elsevier, vol. 137(C).

    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:renene:v:204:y:2023:i:c:p:722-732. 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.journals.elsevier.com/renewable-energy .

    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.