Leveraging renewable energy for sustainable growth: the Asia-Pacific region’s response to CO2 emissions

PurposeThis study investigated how CO2 emissions respond to various factors in the Asia-Pacific region, including GDP, energy consumption, urbanization, renewable energy utilization, and coal-based electricity production.Design/methodology/approachUsing longitudinal data of 16 countries for the time period from 1990 to 2020 and addressing the problem of slope heterogeneity, cross-sectional dependency, unit root problems, and multicollinearity, we estimated cointegration and the CS-ARDL model.FindingsThe study revealed a positive correlation between CO2 emissions and its explanatory variables – GDP, Energy Usage, and electricity production from coal in both short and long run. However, renewable energy consumption has negatively impacted CO2 emissions in both time frames, indicating that low carbon emissions may be achieved by adopting higher renewable energy consumption.Research limitations/implicationsNevertheless, there exists additional potential for prospective examination, encompassing additional variables such as nitrogen oxide, sulphur dioxide, ground-level ozone, and geopolitical trade openness, among others. Furthermore, employing diverse econometric methodologies could yield policy recommendations aimed at environmental decarbonization and the amelioration of climate change.Practical implicationsThe study underscores the urgency of curbing CO2 emissions, signalling out several Asia-Pacific nations as major contributors, thereby necessitating region-wide action, including afforestation, transitioning to renewable energy sources, energy-efficient practices, heightened environmental awareness, and incentivizing eco-friendly technologies.Originality/valueThe present study has a novelty in the sense that it comprehensively studies factors that affect CO2 emissions in Asia Pacific countries and employs advanced econometric models to validate its findings statistically. This study also helps to understand how, over the period, CO2 emissions increased, highlighting the largest emitter in the Asia-Pacific region.