Assessing The Environmental Impact of Energy in the European Union Countries: The STIRPAT Model Analysis for the Period 2000-2019

As a global leader in environmental protection policies, the European Union has greatly emphasized reducing CO2 emissions, the primary contributor to climate change. To achieve this, it has made a strong effort to align its energy policies with its environmental policies. Focusing on the EU’s directives in its energy policy, this study attempts to reveal the factors contributing to CO2 emissions in the EU-27 for the period 2000-2019 within the framework of the STIRPAT model. Employing the fixed effects model with Driscoll and Kraay standard errors, this study reveals that the impacts of population growth, financial development, and energy intensity on CO2 emissions are positive. On the other hand, the impacts of renewable energy consumption and energy-related tax revenue on CO2 emissions are negative in the EU-27.