An investigation on the role of electric vehicles in alleviating environmental pollution: evidence from five leading economies.

ABSTRACT

The relationship between battery electric vehicles (BEV) and carbon dioxide emission (CO2) has significant environmental outcomes. Notwithstanding, battery electric vehicles have not been extensively explored through econometric approach. For countries to meet their net zero targets, it is crucial to consider the role of battery electric vehicles, renewable energy consumption, and CO2. As a result, it is critical to scrutinize a variety of variables that contribute to a sustainable future. This study therefore examines the dynamic correlation between BEV, gross domestic product (GDP), urbanization (URB), renewable energy consumption (REC), population (POP), and CO2 in five leading countries (the United States of America (USA), China, France, Germany, and Norway) using panel data from 2010 to 2020. The study adopted the Westerlund cointegration method to ascertain the long-term nexus among the series. The cross-sectionally augmented autoregressive distributed lag CS-ARDL technique is adopted to evaluate the variables long-run elasticity. The study applied the common correlated effect mean group (CCEMG) and augmented mean group (AMG) approach to ascertain the robustness of the long-run relationships among the variables. Dumitrescu and Hurlin's panel causality analysis determines the extent of the significant causality linkage. The results demonstrate that increased economic growth, urbanization, and population growth accelerate carbon emissions and environmental depletion. However, BEVs were found to be more energy efficient and the adoption of renewable energy through the manufacturing and battery production process would reduce CO2 emission especially in China and the USA. Finally, the research proposed several policy implications for policy and decision-makers in the five leading countries for combating climate change and increasing productivity in the electric vehicle market and renewable energy consumption.