Email this article 
Hide
Show all
Economic Growth in the European Union: The Importance of Renewable Energy Consumption
Abstract
Theoretical background: The studies on the links between renewable energy consumption and economic growth are of great interest. A search of the literature on the subject reveals a diversity of studies in many respects, including but not limited to the search for a unidirectional or reciprocal relationship. The results of the studies often vary depending on the research method used and the period of analysis, which determines subsequent attempts to understand the issue.
Purpose of the article: The aim of this article is to determine the relationship between the consumption of renewable energy sources and economic growth in European Union member states between 2004 and 2020.
Research methods: The study was based on the data from the Eurostat database for the period 2004–2020. The study made use of data normalization using the min-max method. The linear regression method was used to assess the relationship between GDP per capita and the electricity indicators available for final consumption and renewable energy sources.
Main findings: The study did not find a significant trend between renewable energy consumption and economic growth. However, this fact cannot be taken as establishing the absence of a relationship between the two indicators. Although no strong correlation was observed, some interactions are visible depending on the EU member state, which entitles us to partially confirm the research hypothesis. The differences between the groups of EU-15 and EU-10 countries are not distinct, and extending the set of monitored variables (i.e. carrying out modelling for EU-27 countries) does not have a significant impact on the results of the study, which are similar.
Keywords
Full Text:
PDFReferences
Aczel, A.D., & Sounderpandian, J. (2018). Statystyka w zarządzaniu. PWN.
Adamczewska, N., & Zajaczkowska, M. (2022). Realizacja zrównoważonej polityki energetycznej Unii Europejskiej w kontekście Celów Zrównoważonego Rozwoju (SDG) – wybrane aspekty. Folia Iuridica Universitatis Wratislaviensis, 11(2), 9–25. https://doi.org/10.34616/145035
Al-mulali, U., Fereidouni, H.G., Lee, J.Y., & Sab, C.N.B.C. (2013). Examining the bi-directional long run relationship between renewable energy consumption and GDP growth. Renewable and Sustainable Energy Reviews, 22, 209–222. https://doi.org/10.1016/j.rser.2013.02.005
Alper, A., & Oguz, O. (2016). The role of renewable energy consumption in economic growth: Evidence from asymmetric causality. Renewable and Sustainable Energy Reviews, 60, 953–959. https://doi.org/10.1016/j.rser.2016.01.123
Apergis, N., & Payne, J.E. (2012). Renewable and non-renewable energy consumption-growth nexus: Evidence from a panel error correction model. Energy Economics, 34, 733–738.
Berndt, E.R., & Wood, D.O. (1979). Engineering and econometric interpretations of energy-capital complementarity. American Economic Review, 69(3), 342–354.
Brodny, J., Tutak, M., & Saki, S.A. (2020). Forecasting the structure of energy production from renewable energy sources and biofuels in Poland. Energies, 13(10). https://doi.org/10.3390/en13102539
Burke, P.J. (2016). Understanding the energy-GDP elasticity: A sectoral approach. Centre for Applied Macroeconomic Analysis (CAMA).
Busu, M. (2020). Analyzing the impact of the renewable energy sources on economic growth at the EU level using an ARDL model. Mathematics, 8(8), 1367. https://doi.org/10.3390/math8081367
Camacho Ballesta, J.A., da Silva Almeida, L., & Rodríguez, M. (2022). An analysis of the main driving factors of renewable energy consumption in the European Union. Environmental Science and Pollution Research. https://doi.org/10.1007/s11356-022-18715-z
Can, H., & Korkmaz, Ö. (2019). The relationship between renewable energy consumption and economic growth. International Journal of Energy Sector Management, 13(3), 573–589. https://doi.org/10.1108/ijesm-11-2017-0005
Directive (EU) 2018/2001 of the European Parliament and of the Council. https://eur-lex.europa.eu/legal-content/en/TXT/?uri=CELEX%3A32018L2001
Elfaki, K.E., Handoyo, R.D., & Ibrahim, K.H. (2021). The Impact of Industrialization, Trade Openness, Financial Development, and Energy Consumption on Economic Growth in Indonesia. Economies, 9, 17. https://doi.org/10.3390/economies9040174
Eurostat. (2022a). Environment and energy – Energy statistics – Share of energy from renewable sources (information note). https://ec.europa.eu/eurostat/data/database
Eurostat. (2022b). General and regional statistics – Regional economic accounts – Regional GDP. https://ec.europa.eu/eurostat/data/database
Eurostat. (2023). Sustainable development indicators (information note) – Goal 7 – Affordable and clean energy. https://ec.europa.eu/eurostat/data/database
Hannon, B., & Joyce, J. (1981). Energy and technical progress. Energy, 6(2), 187–195. https://doi.org/10.1016/0360-5442(81)90138-9
Firlej, K.A., & Stanuch M. (2023). Forecasting the Development of electricity from renewable energy sources in Poland against the background of the European Union Countries. Economics and Environment, 1(84). https://doi.org/10.34659/eis.2023.84.1.536
Jorgenson, D.W. (1981). Energy prices and productivity growth. The Scandinavian Journal of Economics, 83(2), 165. https://doi.org/10.2307/3439894
Jorgenson, D.W. (1984). The role of energy in productivity growth. The Energy Journal, 5(3). https://doi.org/10.5547/issn0195-6574-ej-vol5-no3-2
Karanfil, F. (2009) How many times again will we examine the energy–income nexus using a limited range of traditional econometric tools? Energy Policy, 37, 1191–1194.
Kasperowicz, R., Bilan, Y., & Štreimikienė, D. (2020). The renewable energy and economic growth nexus in European countries. Sustainable Development, 28(5), 1086–1093. https://doi.org/10.1002/sd.2060
Li, R., & Leung, G.C.K. (2021). The relationship between energy prices, economic growth and renewable energy consumption: Evidence from Europe. Energy Reports, 7, 1712–1719. https://doi.org/10.1016/j.egyr.2021.03.030
Mankiw, N.G., & Taylor, M.P. (2016). Makroekonomia. Warszawa: PWE.
Marinaș, M.-C., Dinu, M., Socol, A.-G., & Socol, C. (2018). Renewable energy consumption and economic growth. Causality relationship in Central and Eastern European countries. PLoS ONE, 13(10), 0202951. https://doi.org/10.1371/journal.pone.0202951
Menegaki, A.N. (2011). Growth and renewable energy in Europe: A random effect model with evidence for neutrality hypothesis. Energy Economics, 33(2), 257–263. https://doi.org/10.1016/j.eneco.2010.10.004
Ocal, O., & Aslan, A. (2013). Renewable energy consumption – economic growth nexus in Turkey. Renewable and Sustainable Energy Reviews, 28, 494–499. https://doi.org/10.1016/j.rser.2013.08.036
Omri, A., Mabrouk, N., & Sassi-Tmar, A. (2015) Modeling the causal link- ages nuclear energy, renewable energy and economic growth in developed and developing countries. Renewable and Sustainable Energy Reviews, 42, 1012–1022.
Saad, W., & Taleb, A. (2017). The causal relationship between renewable energy consumption and economic growth: Evidence from Europe. Clean Technologies and Environmental Policy, 20(1), 127–136. https://doi.org/10.1007/s10098-017-1463-5
Soava, G., Mehedintu, A., Sterpu, M., & Raduteanu, M. (2018). Impact of renewable energy consumption on economic growth: evidence from European Union countries. Technological and Economic Development of Economy, 24(3), 914–932. https://doi.org/10.3846/tede.2018.1426
Solow, R.M. (1956). A contribution to the theory of economic growth. The Quarterly Journal of Economics, 70(1), 65. https://doi.org/10.2307/1884513
Solow, R.M. (1957). Technical change and the aggregate production function. The Review of Economics and Statistics, 39(3), 312. https://doi.org/10.2307/1926047
Stern, D.I. (2000). A multivariate cointegration analysis of the role of energy in the US macroeconomy. Energy Economics, 22(2), 267–283. https://doi.org/10.1016/s0140-9883(99)00028-6
Szustak, G., Dągrowski, P., Gradoń, W., & Szewczyk Ł. (2022). The relationship between energy production and GPD: Evidence from selected European economies. Energies, 15, 50. https://doi.org/10.3390/en15010050
Tanil, G., & Jurek, P. (2020). Policies on renewable energy at the European and national level of governance: Assessing policy adaptation in the Czech Republic. Energy Reports, 6, 548–553. https://doi.org/10.1016/j.egyr.2019.09.024
The European Commission. (2023). European Green Deal, EU agrees stronger legislation to accelerate the rollout of renewable energy. https://ec.europa.eu/commission/presscorner/detail/en/ip_23_2061 e European
Tintner, G., Deutsch, E., Rieder, R., & Rosner, P. (1977). A production function for Austria emphasizing energy. De Economist, 125(1), 75–94. https://doi.org/10.1007/bf01239239
Uçan, O., Arýcýoðlu, E., & Yücel, F. (2014). Energy consumption and economic growth nexus: Evidence from developed countries in Europe. International Journal of Energy Economics and Policy, 4, 411–419.
Wada, I. (2017). Energy production and economic growth in Saudi Arabia: Dynamic causality. Energy Sources, Part B: Economics, Planning and Policy, 12(6), 584–590. https://doi.org/10.1080/15567249.2016.1248872
DOI: http://dx.doi.org/10.17951/h.2024.58.1.95-109
Date of publication: 2024-04-06 14:54:04
Date of submission: 2023-10-02 16:30:51
Statistics
Indicators
Refbacks
- There are currently no refbacks.
Copyright (c) 2024 Krzysztof Adam Firlej, Mateusz Mierzejewski, Marcin Stanuch
This work is licensed under a Creative Commons Attribution 4.0 International License.