INVESTIGATING THE DRIVERS OF RENEWABLE ENERGY PRODUCTION: PANEL DATA EVIDENCE FOR CENTRAL AND EASTERN EUROPEAN COUNTRIES

Abstract

The current study investigates the factors that influence the renewable energy production in Central and Eastern European countries (CEECs), over the period 1990-2019. The empirical research covers several types of renewable energy (renewables and biofuels, hydro, wind, solar photovoltaic, primary solid biofuels, biogases), along with driving factors such as GDP per capita, energy dependence, total natural resources rents, greenhouse gas emissions, unemployment, foreign direct investment flows and patent applications. Mixed linkages are supported by the results of panel data fixed- and random- effects regressions, as well as panel fully modified least squares. Also, the empirical results indicate long-run cointegration between the explored variables. Besides, panel causality analysis reveals several causal relationships between each type of renewable energy and the selected measures. These findings have implications for decision-makers in the public and private sectors who invest in renewable energy.