Do Trade, Foreign Direct Investment and Economic Growth Influence the Renewable Energy Consumption? A Case of BRICS Countries

Abstract

To safeguard the natural environment and promote sustainable economic development, countries worldwide are designing and implementing policies to enhance the use of renewable energy in production processes and other economic activities. In this context, this study examines the significant determinants of renewable energy consumption, including trade, foreign direct investment, and economic growth, in the BRICS countries—Brazil, Russia, India, China, and South Africa. The study covers data from 2001 to 2020 and employs a panel ARDL approach for estimation. The research outcomes indicate that in this region, the mere presence of GDP has a positive impact on the adoption of renewable energy. Based on the findings, the study recommends that these countries should achieve economic growth through sustainable means to increase further the use of renewable energy for industry, transportation, and domestic use in the region.