Exploring the Impact of Renewable and Non-Renewable Energy, Economic Growth and Governance Quality on CO2 Emissions in Asian Countries

This study examines the relationship between renewable and non-renewable energy, economic growth, governance quality, and CO2 emissions as an indicator of environmental quality in Asian developed and developing countries during 1996-2019. The short-run panel causality test results reveal unidirectional causality from GDP to non-renewable energy and validate the conservation hypothesis in all two panels. Moreover, there is evidence of a short-run unidirectional causality from GDP to CO2 emissions and governance quality. The results of panel DOLS indicate a positive impact of GDP and non-renewable energy on CO2 emissions. Also, we find that an increase in renewable energy and improving the quality of governance lead to reductions in CO2 emissions. According to these results, we can suggest replacing non-renewable energy resources with renewable energy resources through restrictive policies for non-renewable energy and incentive policies for renewable energy. Furthermore, planning and goal setting in terms of governance indicators and moving towards good governance by all government, institutions, and private sectors can lead to moving towards sustainable development.