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The Impact of Natural Gas, Oil, and Renewables Consumption on Carbon Dioxide Emissions: European Evidence

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  • Matheus Belucio

    (Economy of Francesco (EoF) Academy, Center for Advanced Studies in Management and Economics (CEFAGE-UE), University of Évora, 7000-809 Évora, Portugal)

  • Renato Santiago

    (Department of Management and Economics, University of Beira Interior, 6200-209 Covilhã, Portugal)

  • José Alberto Fuinhas

    (Centre for Business and Economics Research (CeBER) and Faculty of Economics, University of Coimbra, 3004-512 Coimbra, Portugal)

  • Luiz Braun

    (Mechanical Engineering Department, Federal University of Santa Catarina, Florianópolis 88040-900, Brazil
    Mechanical Engineering Department, University of Coimbra, 3030-194 Coimbra, Portugal)

  • José Antunes

    (Department of Management and Economics, University of Beira Interior, 6200-209 Covilhã, Portugal)

Abstract

Natural gas has returned to prominence in the agenda of European countries since the beginning of the invasion of Ukraine by Russia in 2022. However, natural gas is a fossil source with severe environmental implications. This paper aims to verify the impact of natural gas on carbon dioxide (CO 2 ) emissions for a European panel from 1993 to 2018 for sixteen countries. An Autoregressive Distributed Lag (ARDL) model in the form of an unrestricted error correction model was used to identify the short-run impacts, the long-run elasticities, and the speed of adjustment of the model. The results indicate that in the short-run, natural gas has a negligible impact on CO 2 emissions when faced with oil consumption (6.7 times less), whereas the consumption of renewables and hydroelectric energy proved to be able to decrease the CO 2 emissions both in the short- and long-run. The elasticity of oil consumption is lower than the unit, indicating that efficiency gains have been achieved during the process of the energy transition to clean energy sources. If economies use non-renewable energy, governments must continue to prefer natural gas to oil. Renewables and hydroelectric consumption must be used to revert the path of CO 2 emissions. Given the unstable scenario that has been caused by the War in Eastern Europe, politicians should focus on accelerating the transition from fossil to renewable energies.

Suggested Citation

  • Matheus Belucio & Renato Santiago & José Alberto Fuinhas & Luiz Braun & José Antunes, 2022. "The Impact of Natural Gas, Oil, and Renewables Consumption on Carbon Dioxide Emissions: European Evidence," Energies, MDPI, vol. 15(14), pages 1-16, July.
    • Handle: RePEc:gam:jeners:v:15:y:2022:i:14:p:5263-:d:867273
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