The Nexus between Carbon Pricing, Clean Fuel Technology, and Renewable Energy Sources: Implications for Carbon Emission Reduction

Abstract

Many believe switching to renewable energy sources is the best way to reduce worldwide carbon emissions. Establishing the interaction of renewable energy sources is necessary for long-term sustainable growth, which requires various policy tools with a long-term horizon. This study investigates whether five countries' economies can reduce carbon emissions between 2001 and 2020 using nuclear power and various alternative energy sources. The panel quantile regression estimates range from 0.404% (10th quantile) to 0.211% (90th quantile) in terms of the percentage of carbon harm mitigated by the availability of clean fuel technology. Both nuclear power and other energy sources reduce CO₂ emissions by quantiles of 0.349% (40th percentile) and 0.286% (70th percentile), respectively. Higher carbon prices reduce carbon harm by 0.042% and 0.035% at the 30th and 40th quantiles, respectively. However, quantiles between 70 and 90 indicate increased carbon harm from renewable energy sources. Using clean fuel technology and sustainable energy sources can reduce the adverse effects of carbon. Causality judgments indicate that carbon harm drives clean fuel development, renewable energy adoption, and carbon pricing. However, carbon pricing is more likely to drive people to switch to renewable energy sources. Global renewable energy use trends are increasing due to advances in clean transportation and other energy technologies. Nuclear power is expected to result in a 5.539% variation shock in lower carbon emissions over the next decade. The study's findings suggest that nuclear and alternative energy sources are essential.