BACKGROUND AND OBJECTIVES: Vietnam has experienced rapid economic growth accompanied by increasing energy consumption and environmental pressures, particularly rising carbon intensity. Reducing carbon intensity is essential for achieving sustainable development and meeting climate commitments. Renewable energy and innovation are expected to contribute to improving energy efficiency and decoupling economic growth from environmental degradation. However, empirical evidence on whether renewable energy moderates the relationship between conomic growth and carbon intensity remains limited. The study objectives were to examine both long-run and short-run relationships among economic growth, renewable energy, innovation, and carbon intensity in Vietnam from 1988 to 2021, while also evaluating the moderating role of renewable energy.METHODS: This study applies a vector error correction modeling framework to analyze long-run equilibrium relationships and short-run adjustment dynamics among the variables. The modeling approach allows identification of cointegration relationships and estimation of both long-run coefficients and short-run adjustment processes using annual time-series data.FINDINGS: The results confirm a stable long-run equilibrium relationship. Economic growth has a negative and statistically significant effect on carbon intensity, with estimated coefficients of −0.00593 and −0.00503 in the two models, respectively, both statistically significant at the one percent level. In contrast, renewable energy consumption has a positive and statistically significant long-run effect on carbon intensity, with a coefficient of 0.00760, suggesting that renewable energy has primarily complemented rather than substituted fossil fuels during the study period. The interaction term between renewable energy and economic growth is statistically insignificant, indicating no moderating effect. Innovation also shows no statistically significant impact. In the short run, most coefficients are statistically insignificant, and the adjustment toward long-run equilibrium occurs slowly.CONCLUSION: The findings indicate that reducing carbon intensity in Vietnam is a long-term process that requires deeper structural transformation and stronger integration of renewable energy to support sustainable and low-carbon economic development.
Khang Nguyen (Wed,) studied this question.