Does moving towards renewable energy causes water and land inefficiency? An empirical investigation

Abstract

This study investigates the effect of renewable energy production on water and land footprint in 58 developed and developing countries for the period of 1980-2009. Utilizing the ecological footprint as an indicator, the fixed effects, difference and system generalized method of moment (GMM) approaches were employed and eight different models were constructed to achieve robustness in the empirical outcomes. Despite the use of different methods and models, the outcome was the same whereby GDP growth, urbanization, and trade openness increase the water and land footprint. Moreover, renewable energy production increases the water and land inefficiency because of its positive effect on ecological footprint. Additionally, based on the square of GDP it is concluded that the EKC hypothesis does not exist while the square of renewable energy production indicates that renewable energy production will continue to increase water and land footprint in the future. From the outcome of this study, a number of recommendations were provided to the investigated countries.