How Much Does Increasing the Share of Non-Fossil Fuels in Electricity Generation Reduce Carbon Dioxide Emissions?

Final version published in Applied Energy (2017) Vol. 107, pp. 212-221, DOI:10.1016/j.apenergy.2017.04.025

USAEE Working Paper No. 15-215

16 Pages Posted: 11 Sep 2015 Last revised: 23 Sep 2017

See all articles by Brant Liddle

Brant Liddle

Energy Studies Institute, NUS

Perry Sadorsky

York University - Schulich School of Business

Date Written: June 4, 2015

Abstract

Many international organizations have called for an increased usage of renewable energy as a means to reduce CO2 emissions and address climate change. This paper uses a large panel data set of 117 countries and recently developed panel estimation techniques to answer the question by how much does increasing the share of non-fossil fuels in electricity generation reduce the subsequent carbon dioxide emissions. For the full sample, we find long-run displacement elasticities of approximately -0.75, indicating that a one percent increase in non-fossil fuel electricity generation reduces CO2 emissions per capita from electricity generation by about 0.75%. Long-run displacement elasticities for non-OECD (OECD) countries are approximately - 0.90 (-0.60). These results have a number of policy implications.

Keywords: Carbon dioxide emissions; fossil-fuel displacement; renewable electricity; timeseries, cross-section methods

Suggested Citation

Liddle, Brant and Sadorsky, Perry, How Much Does Increasing the Share of Non-Fossil Fuels in Electricity Generation Reduce Carbon Dioxide Emissions? (June 4, 2015). Final version published in Applied Energy (2017) Vol. 107, pp. 212-221, DOI:10.1016/j.apenergy.2017.04.025; USAEE Working Paper No. 15-215. Available at SSRN: https://ssrn.com/abstract=2614524 or http://dx.doi.org/10.2139/ssrn.2614524

Brant Liddle (Contact Author)

Energy Studies Institute, NUS ( email )

29 Heng Mui Keng Terrace
Singapore
Malaysia

Perry Sadorsky

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

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