The impact of energy sources on carbon dioxide emissions in Sweden: ARDL bounds test analysis

Abstract

The increasing population and the environmental problems caused by this population have caused the demand for energy resources to increase rapidly, and this has become one of the most critical issues for many countries today In this context, the number of countries aiming to become 'carbon neutral' by creating climate policies and making emission commitments in meeting energy demand is increasing rapidly. The aim of this study is to determine the impact of selected energy sources on CO<inf>2</inf> and the connection between these variables using the ARDL Bounds Test Approach and the Toda-Yamamoto technique between 1990 and 2022 for Sweden, which is known for its goal of being carbon neutral in the near term. Given the results, the findings indicate that hydroelectric energy, oil and renewable energy variables have a long-term and substantial impact on carbon dioxide emissions. A 1% elevates in hydroelectric energy and oil variables led to an increase in carbon dioxide emissions of 0.55% and 0.04%, respectively. In addition, a 1% increase in renewable energy variable decreases carbon dioxide emissions by 0.73%. Furthermore, a unidirectional causality from hydroelectric energy to CO<inf>2</inf>, coal and natural gas, and a unidirectional linkage from CO<inf>2</inf> and renewable energy to natural gas are observation in the study. A bidirectional relationship from oil to natural gas and a unidirectional relationship from natural gas to coal are found. Based on these findings, renewable energy should be encouraged and fossil fuel use should be reduced for environmental sustainability. Also, for the efficiency of hydroelectric energy, natural resources should be preserved. © 2025 The Authors. Published by Elsevier B.V.