The relationship between renewable and non-renewable energy consumption, CO₂ emission and sustainable development: The case of Turkey

In this study, the effects of the sources of renewable and non-renewable energy and CO2 emissions on sustainable development in Turkey and the relationship among them are investigated by employing time series analysis techniques for the years between 1972 and 2015 period. The variables used in the study are; CO2 intensity, GDP growth, fossil fuel energy consumption and renewable energy sources. VAR analysis, Granger causality test, impulse-response analysis and variance decomposition analysis are applied in the empirical section of the study. The results of the analysis show that there is a unidirectional causality relationship from renewable energy sources to CO2 intensity and fossil fuel energy consumption. According to the findings of the impulse-response analysis; it is observed that first GDP growth decreases and then increases in the presence of a standard deviation shock to fossil fuel energy consumption and combustible renewable. GDP growth first increases and then reaches the equilibrium point in the presence of one standard deviation shock to the CO2 intensity. It is seen that GDP growth first reacts as decreasing then disappears after reaching the equilibrium point in the presence of one standard deviation shock given to the fossil fuel energy consumption and itself. On the other hand, variance decomposition analysis results indicate that 57% of the change in GDP growth is explained by itself, 33% by renewable energy sources, 3% by fossil fuel energy consumption and 4% by CO2 intensity.