Indicators for sustainable energy development: A multivariate cointegration and causality analysis from Tunisian road transport sector

This paper studies causal mechanism between indicators for sustainable energy development related to energy consumption from Tunisian road transport sector. The investigation is made using the Johansen cointegration technique and the environmental Kuznets curve (EKC) approach. It examines the nexus between transport value added, road transport-related energy consumption, road infrastructure, fuel price and CO 2 emissions from Tunisian transport sector during the period of 1980-2010. Empirical results show that road transport-related energy consumption, transport value added, transport CO 2 emissions and road infrastructure are mutually causal in the long-run. These results do not support the hypothesis of neutrality between energy and income for the Tunisian road transport sector. Also, there is a unidirectional causality running from fuel price to road transport-related energy consumption with no feedback in both the short and long runs. The fuel price and the road infrastructure are significant in the causal chain. Though the estimated long-run cointegrated equation, we conclude that there is an inverse N-shaped relation between transport value added and transport CO 2 emissions, with income turning point respectively equal to 75 and 579 (constant 2000 TND prices). Therefore, our empirical findings refute the hypothesis of an inverted U-shaped EKC for transport CO 2 emissions in Tunisia. The findings of this study have a number of policy implications. Economic growth, environmental degradation, energy and transportation policies should be recognized in order to improve the energy efficiency in transport sector. All measures that should reduce petroleum consumption and greenhouse gas emissions without affecting economic growth may be undertaken. The policymakers in Tunisia should plan urban transport, relocate production units, improve fuel-efficient vehicles and reinforce legislation on controlling emissions in order to copying with policies based on low-carbon development and climate-resilient strategies.