Effect of renewable energy consumption on greenhouse gas emissions in low- and highincome countries

Abstract

Human activities are increasing greenhouse gas (GHG) emissions in the world; therefore, it is necessary to look for alternatives to reduce them. The present work aims to determine the effect that the use of renewable energies and economic growth have on GHG emissions (from 1990 to 2012) in two groups of countries, one with low per capita income and one with high per capita income according to the World Bank classification, by means of a panel data analysis. As well, an ordinary least squares regression was carried out on the model for Mexico and Germany. The results of the analysis indicate that a 1% increase in the consumption of renewable energy reduces GHG emissions by 0.0294% in the group of high-income countries and 0.0171% in the group of low-income countries. Furthermore, when per capita income increases by 1%, GHG emissions increase by 3.5935% in high-income countries and 11.6974% in low-income countries. In the same way, with a 1% increase in the consumption of renewable energy, GHG emissions are reduced by 31 219.9 kt of CO2 in Mexico and 18 160.0 kt of CO2 in Germany. In conclusion, renewable energy consumption contributes to improve environmental quality by reducing the consumption of other nonrenewable energy sources.