Determinants of CO2 Emissions and the Role of Renewable Energy in Romania

Abstract

The present study investigates the determinants of CO2 emissions in Romania, analyzing annual data from 1980 to 2022. The research highlights key factors influencing energy consumption and their economic and social implications. It finds that any short-term increase in energy demand is primarily met through nonrenewable energy sources, as renewable energy usage remains limited in Romania. Several factors contribute to this limited adoption of renewable energy, including high installation costs and a general lack of awareness about environmental responsibilities. A significant positive correlation is identified between nonrenewable energy consumption and CO2 emissions, indicating that as nonrenewable energy use increases, CO2 emissions also rise substantially. This persistent increase in CO2 emissions highlights the urgent need for a transition to renewable energy sources, despite their current minimal role in Romania's energy landscape. In Romania, the dependency on nonrenewable energy sources such as coal, oil, and natural gas is a primary driver of CO2 emissions. This reliance is rooted in the established infrastructure and lower short-term costs associated with these energy sources. However, this practice has severe environmental consequences, contributing to the accumulation of CO2 in the ecosystem and exacerbating climate change issues. The study underscores that high installation costs and a lack of robust policies supporting renewable energy adoption are significant barriers to reducing reliance on nonrenewable energy sources. The findings suggest that Romania needs to address these barriers to shift towards more sustainable energy solutions. Investment in renewable energy infrastructure, subsidies or incentives for renewable energy projects, and public awareness campaigns about the benefits of renewable energy are crucial steps in this transition. By increasing the share of renewable energy in the overall energy mix, Romania can reduce its CO2 emissions and mitigate environmental degradation. Moreover, the study emphasizes the role of policy intervention in accelerating the adoption of renewable energy. Policymakers must focus on creating favorable conditions for renewable energy investments, including financial incentives, streamlined regulatory processes, and support for research and development in renewable technologies. These measures can help overcome the initial cost barriers and promote a broader understanding of the importance of sustainable energy practices. Additionally, the social implications of energy consumption and CO2 emissions are significant. High levels of pollution adversely affect public health, leading to increased healthcare costs and reduced quality of life. By transitioning to cleaner energy sources, Romania can improve public health outcomes, enhance energy security, and foster economic growth through the development of new industries and job opportunities in the renewable energy sector.