Renewable and non-renewable electricity consumption, economic growth and climate change: Evidence from a panel of selected African countries
2021
Brini, Riadh
The imperative to mitigate climate change is one of the biggest challenges that confront mankind in the present millennium and investment in renewable energy source is one of the most viable options. This study examines the dynamic causal relationship between renewable and non-renewable energy consumption, economic growth and climate change for a sample of 16 selected African countries. It applies the Panel Pooled Mean Group-Autoregressive distributed lag model (ARDL-PMG), Panel Mean Group-Autoregressive distributed lag model (ARDL-MG) and Granger Causality tests to annual data covering the period 1980–2014. The empirical analysis confirms the presence of cointegration long-run relationship among variables. In the long-run, non-renewable energy consumption and economic growth are found to have a harmful effect on the climate change, whereas, renewable energy consumption has a beneficial climate change effect. In the short-run, results reveal a bidirectional causality relationship running from non-renewable energy consumption to climate change, supporting the feedback hypothesis, whereas, a unidirectional causality relationship running from climate change to renewable energy consumption is proven. The results suggest mostly that renewable energy consumption can help to mitigate climate change in African countries.
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