Do drivers of renewable energy consumption matter for BRICS economies? Nexus among technological innovation, environmental degradation, economic growth, and income inequality

Abstract

In light of increasing concerns about climate change and energy security, renewable energy has been seen as the most promising solution to fulfl future energy needs. This study examines the drivers of renewable energy consumption (REC) and the nexus between GDP growth, technological innovation, gross fxed capital formation, CO2 emissions, income inequality, and renewable energy consumption (REC) using annual data from BRICS countries. To this end, the study uses the augmented mean group (AMG) estimator, a second-generation estimator that takes slope homogeneity and cross-sectional dependence into consideration. For robustness, the pooled mean group (PMG) estimator has also been utilized. The fndings of both estimators indicate that carbon emissions, technological innovation, and gross fxed capital formation exert adverse and signifcant impacts on REC. The fndings also show that the use of renewable energy will rise as income inequality declines. We also employ the Dumitrescu and Hurlin (DH) granger causality test. The results of the analysis demonstrate a one-way causal association between income inequality and REC. This fnding confrms that a reduction in income inequality will have a major impact on the adoption of renewable energy sources.