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Achieving global carbon neutrality necessitates a decisive transition to clean energy sources. This study examines the dynamic relationships between green finance, mineral resources, technological innovation, carbon taxation, and the green energy transition (GET) within the Nordic energy market from 1995 to 2021. Motivated by the urgent need to understand the key drivers and barriers to sustainable energy adoption, this study employed a robust panel data technique, including Driscoll and Kraay standard errors, cross-sectional dependency tests, and heterogeneity tests, to ensure reliable and generalizable findings. Results from the study confirmed that mineral resources, technological innovation, and green finance play a significant role in promoting the shift to clean energy. In contrast, a carbon tax may negatively hinder this transition by increasing operational costs for energy firms. Furthermore, the causality analysis reveals a unidirectional influence of carbon tax, mineral resources, and technological innovation on GET, as well as a bidirectional relationship between green finance and GET. These findings underscore the importance of carefully designed carbon tax policies and increased support for innovation and green finance to drive the clean energy transition effectively. Additionally, enhanced support for technological innovation, sustainable mineral resource management, and green finance initiatives is essential for accelerating the clean energy transition. This study offers novel empirical insights with significant policy implications to inform Nordic and global efforts toward sustainable energy futures. • Mineral resources, technology innovation, and green finance drive green energy. • Carbon tax may slow down the shift to clean energy. • One-way causality exists from carbon tax, mineral resources, and innovation to GET. • Green finance and green energy transition have a bidirectional causal link.
Dong et al. (Wed,) studied this question.