Abstract The global transition toward renewable energy has intensified as concerns over environmental sustainability and climate change continue to grow. Despite this momentum, the high upfront capital requirements of renewable energy projects highlight the critical role of financialization in facilitating their development. Against this background, this study examines the impact of financialization on three major renewable energy sources such as solar, wind, and hydro incorporating the roles of financial technology, institutional quality, geopolitical risk, and political cooperation in the top 32 Renewable Energy Country Attractiveness Index (RECAI) countries over the period 2000 to 2024. To achieve these objectives, the study employs a range of panel econometric techniques to analyse the long-run and short-run relationships among the variables. The empirical results indicate that conventional financial development does not significantly support the expansion of renewable energy sources in RECAI countries. In contrast, financial technology emerges as a key driver of solar and wind energy development. Furthermore, institutional quality and political cooperation do not promote solar and hydro energy deployment, while geopolitical risk shows a positive association with solar, wind, and hydro energy production. Based on these findings, the study highlights the need for RECAI countries to move beyond broad financial development strategies and adopt targeted financial and technological policies tailored to specific renewable energy sources. Strengthening fintech-driven financing mechanisms and designing risk-resilient energy policies could enhance renewable energy deployment and support long-term energy transition goals in leading renewable energy economies.
Kolati et al. (Mon,) studied this question.