Revisiting the load capacity curve hypothesis: evidence from fintech, renewable energy and environmental sustainability in G-20 economies

Purpose This study aims to examine the impact of financial technology (fintech), renewable energy consumption (REC), government effectiveness (GE) and industrialization (IND) on load capacity factor (LCF). The study is conducted for G-20 economies and takes into consideration the LCF as a measure of environmental sustainability. Additionally, the present research examines the load capacity curve (LCC) hypothesis, highlighting a U-shaped relationship between economic growth (EG) and environmental health. Design/methodology/approach A panel dataset from G-20 countries covering 2005–2022 is analysed using a dynamic panel estimation approach based on the two-step system generalized method of moments technique. A composite Fintech Index is constructed via principal component analysis. Findings The study concludes that (1) fintech and GE positively and significantly influence LCF, (2) IND negatively impacts sustainability and (3) REC shows no statistically significant effect, likely due to its limited integration in the total energy mix, and (4) confirms the LCC hypothesis, indicating that EG initially degrades but later enhances environmental quality. Originality/value This study adds to the existing literature by making three contributions as follows: (1) it considers LCF as a dual-sided sustainability indicator. LCF captures both the ecological supply and demand sides; (2) the study incorporates governance and industrial development to better understand the environmental implications of fintech, which has not been adequately explored, and (3) it provides empirical evidence on the validity of the LCC hypothesis in G-20 economies, thereby addressing an important gap in global sustainability research.A model shows how fintech, growth, renewable energy, governance, and industrialization affect the load capacity factor.A legend at the bottom explains that red arrows indicate “Insignificant effect” and blue arrows indicate “Significant effect”. The model places a central rectangular block labeled “Load Capacity Factor”, surrounded by five rectangular blocks: “Fintech” at the upper left, “Renewable energy consumption” at the lower left, “Government Effectiveness” at the bottom, “Industrialization” at the lower right, and “Economic Growth” at the upper right. A blue arrow connects “Fintech” to the central block through a small block labeled “positive”. A red arrow connects “Renewable energy consumption” to the central block through a block labeled “negative”. A blue arrow links “Government Effectiveness” upward to the central block through a block labeled “positive”. A blue arrow connects “Industrialization” to the central block through a block labeled “negative”. A blue arrow labeled “U shape” links “Economic Growth” to the central block. The text at the top reads: Examining the impact of fintech, economic growth, renewable energy consumption, government effectiveness, and industrialization on Load Capacity Factor.