Does Non-Fossil Energy Usage Lower CO2 Emissions? Empirical Evidence from China

This paper uses an autoregressive distributed lag model (ARDL) to examine the dynamic impact of non-fossil energy consumption on carbon dioxide (CO2) emissions in China for a given level of economic growth, trade openness, and energy usage between 1965 and 2014. The results suggest that the variables are in a long-run equilibrium. ARDL estimation indicates that consumption of non-fossil energy plays a crucial role in curbing CO2 emissions in the long run but not in the short term. The results also suggest that, in both the long and short term, energy consumption and trade openness have a negative impact on the reduction of CO2 emissions, while gross domestic product (GDP) per capita increases CO2 emissions only in the short term. Finally, the Granger causality test indicates a bidirectional causality between CO2 emissions and energy consumption. In addition, this study suggests that non-fossil energy is an effective solution to mitigate CO2 emissions, providing useful information for policy-makers wishing to reduce atmospheric CO2.