Sustainable development, environmental policy and renewable energy use: A dynamic panel data approach

The aim of this paper is to cast light on the relationship between sustainable development environmental policy and renewable energy use. We utilize a dynamic GMM approach over a panel of 34 European Union (EU) countries spanning the period 2005–2013. Our findings reveal a positive monotonic relationship between development and pollution. Energy saving positively affects environmental degradation, while energy intensity increases air pollution. Our findings have important policy implications for policy makers towards sustainability. Despite the fact that the Europe ‘20–20–20’ climate and energy package strategy seems to be achieved, the recently adopted Energy Roadmap 2050 must be updated on a regular basis in order to be effectively implemented and monitored by government officials and firms' stakeholders. Therefore, we argue that EU countries must increase the use of new technology and renewable energy capacity in order to align environmental policies towards more efficient energy use and sustainable development among the EU periphery.