The roles of energy efficiency improvement, renewable electricity production, and financial inclusion in stimulating environmental sustainability in the Next Eleven countries

The sizes of the economies and population of the Next Eleven countries are anticipated to surge in the next couple of decades whereby their energy demands can be assumed to rise in tandem. However, meeting the rising energy demand with the traditionally-consumed unclean energy resources can impose adverse environmental consequences. As a result, achieving environmental sustainability has become an utmost important issue for these countries. Against this backdrop, this study examines whether improving energy efficiency rate, enhancing renewable electricity production, and promoting financial inclusivity can help the Next Eleven countries reduce their carbon dioxide emissions. Overall, the findings reveal that energy efficiency improvement and greater renewable electricity shares in total electricity outputs mitigate carbon dioxide emissions in the long run. Contrarily, financial inclusion, economic growth, and international trade are observed to boost carbon dioxide emissions. Moreover, energy efficiency and financial inclusion are found to jointly inhibit emissions whereby the mediating and moderating effects of energy efficiency on the financial inclusion-carbon dioxide emissions nexus are verified. Furthermore, these findings are robust across alternate estimation techniques and also when total greenhouse gas emissions are considered as an alternative proxy for measuring environmental well-being. Accordingly, several relevant environmental sustainability-related policies are recommended to the concerned governments. (c) 2022 Elsevier Ltd. All rights reserved.

Automated summary

The economies and populations of the Next Eleven countries are expected to grow significantly in the coming decades, leading to increased energy demands. However, relying on traditional unclean energy resources can have adverse environmental consequences. Therefore, achieving environmental sustainability is crucial for these countries. This study explores the impact of improving energy efficiency, promoting renewable electricity production, and enhancing financial inclusivity on reducing carbon dioxide emissions in the Next Eleven countries. The findings suggest that energy efficiency improvement and a higher share of renewable electricity in total electricity production can mitigate carbon dioxide emissions in the long run, while financial inclusion, economic growth, and international trade are found to increase emissions. Additionally, the study reveals that energy efficiency and financial inclusion together have inhibiting effects on emissions, and this relationship is mediated and moderated by energy efficiency. These findings hold true when alternative estimation techniques and total greenhouse gas emissions are considered. The study recommends relevant policies related to environmental sustainability for the governments of the Next Eleven countries.