CO2 emissions and energy technologies in Western Europe

In this paper, we investigate the path to the green transition in Europe. In so doing, we implement an empirical model of dynamic panel data on a sample of sixteen Western European countries over the period 1980 to 2019. The model is consistent withvariousfeaturesofneoclassicalgrowththeoryincorporatingenergyuse.Ourfocus is on the short-run determinants of carbon emissions within that set of countries. We provide evidence that the relationship between economic activity and CO2 emissions is strong in economies where economic booms depend on energy-intensive sectors. Also,themitigatingroleofrenewableenergytechnologiesiskeywhenenergyintensity rebounds. These circumstances may constitute a challenge for the climate transition goals targeted in the EU’s Recovery Plan, whose main objective at this very moment is to mitigate the economic and social impact of the coronavirus pandemic.Wethank Pau Pujolas, Jesús Rodríguez-López and Jesús Ruiz for helpful comments, and seminar participants at ICAE-UCM and Universidad de Cantabria. We also thank two anonymous referees and the editors for multiple suggestions. We acknowledge the Spanish Ministry of Science and Innovation (Grant PID2019-107161GB) for financial support