4.7 Article

Can green financial development promote renewable energy investment efficiency? A consideration of bank credit

Journal

RENEWABLE ENERGY
Volume 143, Issue -, Pages 974-984

Publisher

PERGAMON-ELSEVIER SCIENCE LTD
DOI: 10.1016/j.renene.2019.05.059

Keywords

Green finance; Bank credit; Investment efficiency; Renewable energy investment

Funding

  1. National Natural Science Foundation of China [41801118]
  2. Ministry of Education of Humanities and Social Science Project of China [16YJAZH015]

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Taking 141 listed renewable energy enterprises in China as a sample, the Richardson model is adopted to measure their investment efficiency in this paper. On this basis, an intermediary effect model of panel data is constructed to empirically analyze the intermediary effect of green financial development on renewable energy investment efficiency through bank loans, short-term loans, and long-term loans. We find that China's green financial development has a negative impact on bank loan issuance in general, and inhibits the improvement of renewable energy investment efficiency to a certain extent, with an effect degree of 0.0017. Besides, the short-term loan has few intermediate effect on investment efficiency, while there is no intermediary effect of long-term loans. Moreover, as for the over-investment renewable energy enterprises, intermediary effect of bank loans exists. Green financial development can inhibit over-investment in renewable energy by reducing bank credit issuance; for renewable energy companies of under-investment, on the contrary, it aggravates the under-investment to a certain extent. This paper suggests that the government should both construct and consummate the green financial system through policies and regulation. Financial institutions should actively produce innovative green financial products and support the development of renewable energy enterprises and the renewable energy enterprises should strengthen their internal management and develop financing channels. (C) 2019 Elsevier Ltd. All rights reserved.

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