Exploring the effect of the renewable energy transition on CO₂emissions of Latin American & Caribbean countries

This article investigates the effect of the renewable energy transition on CO2 emissions of Latin American & Caribbean (LAC) countries in the period from 1990 to 2014. To this end, a panel autoregressive distributed lags (PARDL) model in the form of an unrestricted error-correction model (UECM) is estimated. The PARDL indicates that the ratio of renewable energy that is a proxy of the renewable energy transition in the short and long-run has a negative impact on emissions of CO2 of −0.0675 and −0.0313, respectively. That is, the process of the energy transition can mitigate environmental degradation in LAC countries. Moreover, the empirical results also indicate that economic growth, trade openness and urbanisation contribute to the increase in CO2 emissions.

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