Impact of renewable and fossil fuel energy consumption on environmental degradation: evidence from USA by nonlinear approaches

ABSTRACT

The study investigates impact of energy consumption on environmental degradation at aggregated and disaggregated levels. In this context, the study considers carbon dioxide (CO₂) emissions as proxy of environmental degradation, and focuses on the United States of America (USA) as the biggest economy and highest second carbon-emitting country. Moreover, the study uses monthly data between 1989 January and 2021 September and performs nonlinear approaches as Wavelet Coherence (WC), Granger Causality-in-Quantiles (GCQ), and Quantile-on-Quantile Regression (QQR). Besides, Quantile Regression (QR) is used for robustness checks of the QQR. The results show that (i) energy consumption has an important impact on the CO₂ emissions in the short, medium and long term, while the impact changes according to times and frequencies; (ii) causal effect exists in almost all quantiles excluding some lower (0.05, 0.25), middle (0.65, 0.70, 0.75, 0.80) and higher (0.95) quantiles, whereas indicator-based results change a bit; (iii) the QR results confirm that the QQR results are robust; (iv) overall, the effects of the energy consumption indicators change according to times, frequencies, quantiles, and aggregated/disaggregated levels. Hence, the empirical outcomes underline the significance of renewable energy consumption in improving environmental quality through limiting CO₂ emissions at aggregated and disaggregated levels. The results imply that the USA policymakers should focus on the efforts the decreasing fossil sources and increasing renewable sources through conversion of energy systems to limit CO₂ emissions while considering changing impacts of energy consumption at various times, frequencies, quantiles, and aggregated/disaggregated levels.

KEYWORDS:

• Renewable energy
• fossil fuel energy
• energy consumption
• CO₂
• USA

Highlights

• The study investigates impacts of energy consumption on environmental degradation.

• The study analyzes United States of America at aggregated and disaggregated levels.

• The study applies nonlinear models as the WC, GCQ, QQR, and QR approaches.

• The results show significant impacts of the energy consumption on the CO₂ emissions.

• The impacts change to times, frequencies, quantiles, and aggregate/disaggregate levels.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Consent for publication

The authors are willing to permit the Journal to publish the article.

Authors contributions

The authors have contributed equally to this work.

Data availability statement

The data that support the findings of this study are available in the US Energy Information Administration (EIA) at https://www.eia.gov/totalenergy/data/monthly.

Supplementary material

Supplemental data for this article can be accessed online at https://doi.org/10.1080/13504509.2022.2087115

Additional information

Funding

This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors.