Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns
As concerns regarding the adverse impacts of energy production and consumption on the environment grow, countries across the world are now charged with developing effective strategies that provide energy security and protect the environment. This means that efforts to generate significant investment...
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| Format: | Article |
| Language: | English |
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MDPI AG
2020-12-01
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| Series: | Energies |
| Subjects: | |
| Online Access: | https://www.mdpi.com/1996-1073/13/24/6740 |
| _version_ | 1797544008539439104 |
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| author | Ishaya Tambari Pierre Failler |
| author_facet | Ishaya Tambari Pierre Failler |
| author_sort | Ishaya Tambari |
| collection | DOAJ |
| description | As concerns regarding the adverse impacts of energy production and consumption on the environment grow, countries across the world are now charged with developing effective strategies that provide energy security and protect the environment. This means that efforts to generate significant investments and business opportunities to boost the growth of renewable energy need to increase rapidly. However, there are limited studies on what will facilitate the increase of renewable energy investment in Africa. The main factor considered in this study relates to the sensitivity to changes in oil prices, gross domestic product (GDP), interest rate and oil price volatility’s impact on the renewable energy investment (REI) in countries with energy security concerns and if there is any significant influence from oil price shocks. With the help of an unrestricted vector retrogressive model and an annual panel data approach that covers the period 1990–2018, this paper examines the link between renewable energy investment and three macroeconomic variables: oil prices, GDP growth-adjusted interest rates and oil price volatility. The results indicate that REI exhibited immediate positive responses to oil shocks. However, renewable energy investment continued to fluctuate negatively in response to GDP. The results also show that the REI responded positively to interest rates in Africa and it exhibited immediate negative responses to oil price volatility but became positive after the second period. |
| first_indexed | 2024-03-10T13:53:32Z |
| format | Article |
| id | doaj.art-7b85bbaa39b2426c9635493583b5f8e8 |
| institution | Directory Open Access Journal |
| issn | 1996-1073 |
| language | English |
| last_indexed | 2024-03-10T13:53:32Z |
| publishDate | 2020-12-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Energies |
| spelling | doaj.art-7b85bbaa39b2426c9635493583b5f8e82023-11-21T01:51:59ZengMDPI AGEnergies1996-10732020-12-011324674010.3390/en13246740Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security ConcernsIshaya Tambari0Pierre Failler1Centre for Blue Governance, Department of Economics and Finance, University of Portsmouth, Portsmouth P01 3DE, UKCentre for Blue Governance, Department of Economics and Finance, University of Portsmouth, Portsmouth P01 3DE, UKAs concerns regarding the adverse impacts of energy production and consumption on the environment grow, countries across the world are now charged with developing effective strategies that provide energy security and protect the environment. This means that efforts to generate significant investments and business opportunities to boost the growth of renewable energy need to increase rapidly. However, there are limited studies on what will facilitate the increase of renewable energy investment in Africa. The main factor considered in this study relates to the sensitivity to changes in oil prices, gross domestic product (GDP), interest rate and oil price volatility’s impact on the renewable energy investment (REI) in countries with energy security concerns and if there is any significant influence from oil price shocks. With the help of an unrestricted vector retrogressive model and an annual panel data approach that covers the period 1990–2018, this paper examines the link between renewable energy investment and three macroeconomic variables: oil prices, GDP growth-adjusted interest rates and oil price volatility. The results indicate that REI exhibited immediate positive responses to oil shocks. However, renewable energy investment continued to fluctuate negatively in response to GDP. The results also show that the REI responded positively to interest rates in Africa and it exhibited immediate negative responses to oil price volatility but became positive after the second period.https://www.mdpi.com/1996-1073/13/24/6740renewable energy investment (REI)oil pricegross domestic product (GDP)vector autoregression (VAR)renewable energy |
| spellingShingle | Ishaya Tambari Pierre Failler Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns Energies renewable energy investment (REI) oil price gross domestic product (GDP) vector autoregression (VAR) renewable energy |
| title | Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns |
| title_full | Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns |
| title_fullStr | Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns |
| title_full_unstemmed | Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns |
| title_short | Determining If Oil Prices Significantly Affect Renewable Energy Investment in African Countries with Energy Security Concerns |
| title_sort | determining if oil prices significantly affect renewable energy investment in african countries with energy security concerns |
| topic | renewable energy investment (REI) oil price gross domestic product (GDP) vector autoregression (VAR) renewable energy |
| url | https://www.mdpi.com/1996-1073/13/24/6740 |
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