Renewable Energy and Proven Oil Reserves Relation: Evidence from OPEC Members

The well documented literature on the relation between energy consumption and climate change has been extended by the addition of renewable energy consumption. Several studies show its impact on technical efficiency, per capita income or carbon dioxide (CO2) emission levels for developed and developing countries. However, to the extent of our knowledge, very few of them state the importance of renewable energy for the countries where the main type of fossil fuels, oil, is exported. This study aims to explore the association between renewable energy, real gross domestic product (GDP), CO2 emission level, real oil prices as well as the proven oil reserves for seven members of Organization of the Petroleum Exporting Countries (OPEC). The analyses are conducted using panel data techniques, namely fixed effect – random effect tests. Our results show a positive and significant relation between renewable energy consumption, and real GDP and CO2 emission level. A statistically not significant coefficient is found for the relation between renewable energy and the proven oil reserves. The relation between energy and real oil prices is also insignificant.