Renewable energy for achieving environmental sustainability: institutional quality and information and communication technologies as moderating factors

Abstract

The environmental challenges are currently placed at the forefront in order to achieve sustainable development. Although existing studies have largely examined the underlying factors of the environmental sustainability, the institutional quality and the role of information and communication technologies (ICTs) still insufficiently investigated. The aim of this paper is to clarify the role played by institutional quality and ICTs to mitigate environmental degradation at different scales of the ecological gap. Therefore, the purpose of the study is to examine whether the quality of institutions and ICTs consolidate the contribution of renewable energy to reduce the ecological gap and thereby, promote environmental sustainability. The results of panel quantile regression applied to fourteen selected Middle East (ME) and Commonwealth of Independent States (CIS) countries from 1984 to 2017 showed that the rule of law, control of corruption, Internet use, and mobile use exert no beneficial effects on environmental sustainability. The ICTs and the institutional development through the presence of an appropriate regulatory framework and the control of corruption have rather advantageous moderating effects on the environmental quality. Indeed, our findings revealed that the effects of renewable energy consumption on the environmental sustainability are positively moderated by the control of corruption, Internet use, and mobile use for countries with medium and high ecological gaps. The beneficial ecological effects of renewable energy are also moderated by the presence of a solid regulatory framework, but only for countries with high ecological gaps. In addition, our results showed that financial development promotes environmental sustainability in countries with low ecological gaps. Urbanization has perverse effects on the environment across all quantiles. The results found lead to important practical implications for preserving the environment as it suggests designing ICTs and improving the quality of institutions oriented to renewable energy sector in order to reduce the ecological gap. In addition, the findings from this paper can serve decision-makers in terms of environmental sustainability given the globalizing and conditional approach followed.

Keywords: Ecological gap; Information and communication technologies; Institutional quality; Renewable energy.