Should the European Union prioritize renewble energy or tackle energy poverty?

Yıl 2024, , 255 - 277, 24.06.2024

Yağmur Sağlam , Mehmet Samet Erdem

https://doi.org/10.58559/ijes.1471770

Öz

Energy poverty is a type of poverty that is not solely based on monetary factors. It has recently been highlighted in the literature alongside the acknowledgment of energy as a key component of sustainable economic growth. Many studies focus on replacing fossil fuels with renewable energy sources to address this issue. This study aims to analyze the impact of renewable energy consumption on energy poverty in the European Union from 1996 to 2020. The study incorporates a control variable, developed using Principal Component Analysis (PCA), to account for economic development. Second-generation panel data tests and the Common Correlated Effects Model are utilized to assess the short and long-term effects. The findings indicate that the control variable had no significant impact on energy poverty during the relevant period. Still, renewable energy consumption had both positive effects in developed countries and negative effects in transition economies. According to the results, energy poverty measures remain a key priority in most of Europe's energy policies. This highlights the significance of ensuring that the underprivileged section of society has access to affordable and sustainable energy sources.

Anahtar Kelimeler

renewable energy, panel data analysis, energy poverty

Etik Beyan

The author/The authors of the paper submitted declare/declares that nothing which is necessary for achieving the paper requires ethical committee and/or legal-special permissions.

Kaynakça

• [1] Ahmad F, Muhammad UD, Su L, Ozturk I, Rauf A, Shaid, A. Impact of FDI inflows on poverty reduction in the ASEAN and SAARC economies. Sustainability 2019; 11(9): 2565.
• [2] Ahmed, MM, Shimada K. The effect of renewable energy consumption on sustainable economic development: Evidence from emerging and developing economies. Energies 2019; 12(15): 2954.
• [3] Aldieri L, Gatto A, Vinci CP. Panel data and descriptor for energy econometrics – an efficiency, resilience and innovation analysis. Quality & Quantitiy 2023; 57(2): 1649–1656.
• [4] Alper A, Oguz O. The role of renewable energy consumption in economic growth: Evidence from asymmetric causality. Renewable and Sustainable Energy Reviews 2016; 60: 953-959.
• [5] Amin A, Liu Y, Yu J, Chandio AA, Rasool SF, Luo J, Zaman S. How does energy poverty affect economic development? A panel data analysis of South Asian countries. Environmental Science and Pollution Research 2020; 27: 31623–31635.
• [6] Apergis N, Danuletiu DC. Renewable energy and economic growth: Evidence from the sign of panel long-run causality. International Journal of Energy Economics and Policy 2014; 4(4): 578-587.
• [7] Asiedu BA, Hassan AA, Bein MA. Renewable energy, non-renewable energy, and economic growth: Evidence from 26 European countries. Environmental Science and Pollution Research 2021; 28: 11119-11128.
• [8] Burlinson A, Giulietti M, Law C, Liu H H. Fuel poverty and financial distress. Energy Economics 2021; 105464: 102-121.
• [9] Chaton C, Gouraud A. Simulation of fuel poverty in France. Energy Policy 2020; 111434: 140-150.
• [10] Dalla Longa F, Sweerts B, van der Zwaan B. Exploring the complex origins of energy poverty in The Netherlands with machine learning. Energy Policy 2021; 112373: 156.
• [11] Dayıoglu T. Dynamics affecting renewable energy: A panel quantile regression approach. Journal of Applied Microeconometrics 2022; 2(1): 1-8.
• [12] Delugas E, Brau R. Evaluating the impact of energy poverty in a multidimensional setting. The Energy Journal 2021; 42(1): 39-66.
• [13] Dong K, Ren X, Zhao J. How does low-carbon energy transition alleviate energy poverty in China? A nonparametric panel causality analysis. Energy Econ 2021; 105620: 103.
• [14] Enders W, Lee J. Testing for a unit root with a nonlinear Fourier function. Econometric Society Far Eastern Meetings 2004; 457: 1-47.
• [15] EPEE. Tackling Fuel Poverty in Europe, Recommendations Guide for Policymakers, 2011. https://www.finlombarda.it/c/document_library/get_file?p_l_id=1313844&folderId=1327936&name=DLFE-6278.pdf%20 (27.03.2024).
• [16] European Commission. Staff Working Document, 2023. https://energy.ec.europa.eu/publications/commission-staff-working-document-eu-guidance-energy-poverty_en (14.02.2024).
• [17] Gavashelisvili S.The Impact of Energy Use on Energy Poverty. MA Thesis, Marmara University, 2019.
• [18] Hacıimamoğlu T, Sandalcılar AR. The effect of renewable energy consumption on economic stability: Panel data analysis on selected countries. Emerging Markets Journal 2020; 10(1): 10-20.
• [19] Hanff E, Dabat MH, Blin J. Are biofuels an efficient technology for generating sustainable development in oil-dependent African nations? A macroeconomic assessment of the opportunities and impacts in Burkina Faso. Renewable And Sustainable Energy Reviews 2011; 15(5), 2199-2209.
• [20] Heffron RJ, McCauley D. What is the’ just transition? Geoforum 2018; 88: 74–77.
• [21] Hotelling H. Analysis of a Complex of Statistical Variables into Principal Components. Journal of Educational Psychology 1933; 24(6): 417–441.
• [22] IEA Energy and Renewables. Invest in Turkey, 2018. http://www.invest.gov.tr/enUS/sectors/Pages/Energy.aspx (17.02.2024).
• [23] Inglesi-Lotz R. The impact of renewable energy consumption to economic growth: A panel data application. Energy Economics 2016; 53: 58-63.
• [24] International Energy Association (IEA) report, 2017. https://webstore.iea.org/download/summary/274?fileName=English-Energy-AccessOutlook-2017-ES.pdf (17.02.2024).
• [25] Isazade S, Altan M. A review of literature on measuring energy poverty. Eskişehir Osmangazi Üniversitesi Sosyal Bilimler Dergisi 2023; 24(2): 336-361.
• [26] Jolliffe IT. Principal Component Analysis. Second ed. Springer Series in Statistics. New York, US, 2002.
• [27] Jones G, Schneider WJ. Intelligence, human capital, and economic growth: a Bayesian averaging of classical estimates (BACE) approach. Journal of Economic Growth 2006; 11: 71–93.
• [28] Karul Ç. Esnek Fourier fonksiyonlu yeni bir panel birim kök testi önerisi ve OECD örneği. Yüksek Lisans Tezi, Pamukkale Üniversitesi 2016.
• [29] Khan M, Majeed MT. Financial sector development and energy poverty: empirical evidence from developing countries. Environmental Science and Pollution Research 2023; 30(16): 46107–46119.
• [30] Kurozumi E. Testing for stationarity with a break. Journal of Econometrics 2002; 108(1): 63-99.
• [31] Pearson K. On Lines and Planes of Closest Fit to Systems of Points in Space. Philosophical Magazine 1901; 2(11): 559–572.
• [32] Pehlivanoglu F, Kocbulut O, Akdag S, Alola AA. Toward a sustainable economic development in the EU member states: The role of energy efficiency‐intensity and renewable energy. International Journal of Energy Research 2021; 45(15): 21219-21233.
• [33] Pesaran HM, Yamagata T. Testing slope homogeneity in large panels. Journal of Econometrics 2008; 142: 50-93.
• [34] Pesaran HM. General diagnostic tests for cross section dependence in panels. Cambridge Working Papers. Economics 2004; 1240: 1.
• [35] Pesaran HM. Estimation and inference in large heterogeneous panels with a multifactor error structure. Econometrica 2006; 74(4): 967-1012.
• [36] Piłatowska M, Geise A, Włodarczyk A. The effect of renewable and nuclear energy consumption on decoupling economic growth from CO2 emissions in Spain. Energies 2020; 13(9): 2124.
• [37] Rademaekers K, Yearwood J, Ferreira, A, Pye S, Hamilton I, Agnolucci P, Anisimova N. Selecting indicators to measure energy poverty, Rotterdam: European Commission. DG Energy, 2016. https://energy.ec.europa.eu/publications/selecting-indicators-measure-energy-poverty_en, (31.01.2024).
• [38] Renewables Global Status Report. Renewable Energy Policy Network for 21st Century, 2018 http://www.ren21.net/status-of-renewables/global-status-report/ (17.02.2024).
• [39] Robic S, Olshanskayab M, Vrbenskyb R, Morvajb Z. Understanding energy poverty - case study: Tajikistan, 2010. https://www.osti.gov/etdeweb/servlets/purl/21390276 (31.01.2024).
• [40] Saad W,Taleb A. The causal relationship between renewable energy consumption and economic growth: evidence from Europe. Clean Technologies and Environmental Policy 2018; 20: 127-136.
• [41] Sadorsky P. Renewable energy consumption and income in emerging economies. Energy Policy 2009; 37(10): 4021-4028.
• [42] Saint Akadiri S, Alola AA, Akadiri AC, Alola UV. Renewable energy consumption in EU-28 countries: policy toward pollution mitigation and economic sustainability. Energy Policy 2019; 132: 803-810.
• [43] Sarwar S, Chen W, Waheed R. Electricity consumption, oil price and economic growth: global perspective. Renewable and Sustainable Energy Reviews 2017; 76: 9-18.
• [44] Scarpellini S, Hernández MAS, Moneva JM, Portillo-Tarragona P, Rodríguez MEL. Measurement of spatial socioeconomic impact of energy poverty. Energy Policy 2019; 124: 320-331.
• [45] Selçuk IŞ, Gölçek AG, Köktaş, AM. Energy poverty in Turkey. Socioeconomics 2019; 27(42): 283-299.
• [46] Sharma GD, Tiwari AK, Erkut B, Mundi, HS. Exploring the nexus between non-renewable and renewable energy consumptions and economic development: Evidence from panel estimations. Renewable and Sustainable Energy Reviews 2021; 146: 111152.
• [47] Simionescu M, Radulescu M, Cifuentes-Faura J, Balsalobre-Lorente D. The role of renewable energy policies in tackling energy poverty in the European Union. Energy Policy 2023; 183: 113826.
• [48] Spiliotis E, Arsenopoulos A, Kanellou E, Psarras J, Kontogiorgos P. A multisourced data-based framework for assisting utilities identify energy poor households: A case- study in Greece. Energy Sources, Part B: Economics, Planning, and Policy 2020; 15(2): 49-71.
• [49] Streimikiene D. COVID-19 impacts on Energy Poverty: Lithuanian case study. Montenegrin journal of economics. Podgorica: Economic Laboratory Transition Research (ELIT) 2022; 18(1): 215-223.
• [50] EPEE. The European Fuel Poverty and Energy Efficiency, 2023. https://www.finlombarda.it/c/document_library/get_file?p_l_id=1313844&folderId=1327936&name=DLFE-6278.pdf%20 (31.01.2024).
• [51] Tsani SZ. Energy consumption and economic growth: A causality analysis for Greece. Energy Economics 2010; 32(3): 582-590.
• [52] Uche E, Das N, Bera P, Cifuentes-Faura J. Understanding the imperativeness of environmental-related technological innovations in the FDI–Environmental performance nexus. Renewable Energy 2023; 206: 285–294.
• [53] Von Platten J. Energy poverty in Sweden: using flexibility capital to describe household vulnerability to rising energy prices. Energy Research & Social Science 2022; 91:102746.
• [54] Wang Q, Dong Z, Li R, Wang L. Renewable energy and economic growth: New insight from country risks. Energy 2022; 238: 122018.
• [55] World Economic Forum. Energy Poverty Action, 2010.
• [56] Yılmaz G, Daşdemir E. Renewable energy use and energy productivity: A panel data analysis, Journal of Sustainable Economics and Management Studies 2020; 1(1): 73-82.