Evaluating the Impact of Renewable Energy Consumption on Economic Growth in Emerging Economies: A Dynamic Panel Data Analysis

Decarbonisation, achieved through the switch to renewable energy sources, is critical to tackling issues related to climate change.However, the process is costly, especially for emerging economies, where financial constraints and competing priorities must be taken into consideration.Policymakers are tasked with addressing these complexities by developing strategies that efficiently distribute resources and encourage investment from the private sector.This analysis explores the connection between the use of renewable energy and economic expansion in 18 developing nations, using data from the World Development Indicators spanning the years 2000 to 2023.The findings indicate an absence of a statistically significant relationship between the utilisation of renewable energy and economic growth.Nonetheless, the analysis reveals a robust and consistent link between capital formation and economic expansion, underscoring the significance of investment as a crucial catalyst for growth.The findings indicate that although the adoption of renewable energy is essential for sustainability, its immediate economic advantages in emerging markets are constrained.It is essential for those in positions of authority to focus on approaches that harmonise environmental objectives with the overarching necessity to foster economic growth and optimise resource use.