Can renewable energy investment reduce carbon dioxide emissions? Evidence from scale and structure

Many countries have invested a lot in renewable energy to reach carbon neutrality. However, whether renewable energy investment effectively reduces carbon dioxide emissions still needs to be verified systematically. This paper examines the impact of renewable energy investment on carbon dioxide emissions by considering both scale and structure. It uses data from 13 countries that have made large investments in renewable energy from 2010 to 2019. A parallel multiple mediator model is used to analyze the impact of renewable energy investment scale on carbon dioxide emissions, in which multiplier effect, technique effect, and structure effect are identified as mediation effects. A chain multiple mediator model and a parallel multiple mediator model are integrated to identify the effect of renewable energy investment structure on carbon dioxide emissions, in which allocation effect is also considered. It concludes that, on the whole, increasing renewable energy investment scale can increase carbon dioxide emissions. Specifically, increasing renewable energy investment scale can indirectly reduce carbon dioxide emissions through the technique effect and increase carbon dioxide emissions through the multiplier effect. However, the structure effect on carbon dioxide emissions caused by renewable energy investment scale is not significant. Moreover, increasing the proportional investment in wind energy can reduce carbon dioxide emissions. Meanwhile, increasing the proportional investment in solar energy and bioenergy can increase carbon dioxide emissions. This paper also finds that increasing the proportional investment in renewable hydropower does not significantly affect carbon dioxide emissions.

Automated summary

This study examines the impact of renewable energy investment on carbon dioxide emissions and finds that increasing the scale of investment may increase emissions, while the effect depends on the investment structure. Increasing the proportional investment in wind energy can reduce emissions, while increasing the proportional investment in solar energy and bioenergy may increase emissions.