Does R&D investment in renewable energy technologies reduce greenhouse gas emissions?

JournalApplied Energy
AuthorsAbebe Hailemariam, Kris Ivanovski, Ratbek Dzhumashev
PublishedOctober 2022
PublisherElsevier
DOIhttps://doi.org/10.1016/j.apenergy.2022.120056
Research ThemesBusiness and Industry, Climate risks and resilience, Energy, resources and sustainability, Productivity and Innovation
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Highlights

  • We investigate the link between investment in renewable energy technologies on environmental quality.
  • Our methodological approach utilises an interactive-fixed effects model to deal with endogeneity issues.
  • Our findings show that R&D investment in renewables has a significant positive effect on environmental quality.

In this paper, we investigate the impact of public investment in R&D in renewable energy technologies on environmental quality using a spectrum of environmental emissions.

We employ new and innovative panel data methods to address the existing econometric issues in estimating the effect of R&D on greenhouse gas emissions.

Then, using data from advanced and emerging economies that span the period from 1980 to 2020, we find that R&D investment in renewable technologies has a significant positive effect on environmental quality by reducing a range of pollutants, including carbon dioxide, methane, and other pollutants.

The results are robust to a series of sensitivity tests.

The findings have important policy implications for climate change and various recent environmental initiatives, including the transition to net-zero emissions and sustainability.