Towards <scp>SDG</scp> ‐Aligned Carbon Neutrality in <scp>EU</scp> Countries: How Energy Policy, Energy R&amp;D Budget, and Sustainable Growth Shape the Transition?

ABSTRACT This paper presents a comprehensive policy framework for achieving Sustainable Development Goals 7 and 9 and evaluates the EU's carbon neutrality target for 2050. In this context, the effects of renewable energy consumption, energy R&amp;D budget, energy taxes, and economic growth on the carbon footprint are examined for nine selected EU countries with available data, covering the period 1995–2022. The estimation results, which also examine the validity of the EKC hypothesis, are as follows: The EKC hypothesis is valid in EU countries. This implies that economic growth has a carbon footprint‐reducing effect beyond a specific point. Energy tax and renewable energy policies followed in EU countries have a carbon footprint‐reducing effect. The R&amp;D budget allocated to energy by EU countries is not an effective policy tool for managing carbon footprint. In general, it is recommended that policymakers allocate more of their budget to energy R&amp;D and use an energy tax effectively to achieve sustainable environmental quality and promote renewable energy sources.