Does ESG Uncertainty Accelerate Energy Transition? Evidence of Demand Reallocation Toward Renewables in Canada

This study investigates whether ESG-related uncertainty in Canada reallocates energy demand toward cleaner sources or reduces overall energy use during 2002Q1–2024Q4. Using multivariate wavelet quantile regression and robustness checks, we identify heterogeneous effects across quantiles and time scales. The results show that ESG uncertainty is more consistently linked to a higher share of renewables in total energy than to broad declines in aggregate energy use, supporting a reallocation channel rather than a demand-reduction channel.