- Developing countries, Environmental sustainability, Renewable energy, Renewable energy consumption, Renewable energy potential.
This study investigated the nexus between renewable energy consumption and economic growth in developing countries and the role of environmental sustainability in the nexus between renewable energy consumption and economic growth. To achieve the objective, the researcher employed General Method of Moment (GMM) to solve for the possible problem of endogeneity common in previous studies using data sourced from World Bank. It was discovered that renewable energy consumption has positive but weak impact on economic growth in developing countries but when environmental sustainability is accounted, the impact of renewable energy consumption improves. Similarly, interacting CO2 with renewable energy changes the sign of CO2 from positive to negative. The implication of this study is that renewable energy consumption impacts on the economy might be weak but is justified giving its environmental sustainability potential.