Digitalization, Energy and GHG Emissions: A Path Analysis of the Impact

The transition to a carbon-neutral society represents one of the most pressing global challenges of the 21st century, requiring a radical transformation in how energy is produced, consumed, and managed. Digitalization has emerged as a pivotal driver in energy transition, offering innovative Pathways to enhance energy efficiency and penetrate renewable energy that should lead to reduced GHG emissions. The aim of the research was to develop a model for the evaluation of digitalization impact on GHG emissions where energy serves as a mediating factor. The data of 27 European Union Member States was employed for the investigation covering the period 2014–2023. Principal Component Analysis was utilized to calculate the composite indicators of digitalization and energy. A comprehensive and systematic analysis of the complex interactions of digitalization, energy and GHG emissions was performed using a path analysis. The findings emphasized the critical role of the rebound effect of digitalization as the advantages associated with energy efficiency and the integration of renewable energy, facilitated by digitalization, are overweighted by increased energy consumption. The research ultimately contributes to a deeper understanding of how digitalization can be measured, guided, and optimized to support sustainable energy and mitigation of climate change.