IMPACT OF RENEWABLE AND NON-RENEWABLE ENERGY TOWARD CO2 EMISSIONS IN MALAYSIA

Abstract

In Malaysia, carbon dioxide (CO2 ) emissions result from the usage of nonrenewable energy sources. In recent decades, energy usage in Malaysia has significantly increased, driven by both residential and industrial factors. The increased demand for power is partially attributable to the nation’s rapid economic development and urbanisation. Therefore, Malaysia is conscious of its responsibility in developing sustainable energy in order to fulfil SDG7 by 2030. This research analyses whether hydroelectric power, as a clean energy source, and various sources of fossil fuel-based energy affect CO2 emissions in Malaysia. The research employs the Autoregressive Distributed Lag (ARDL) and Non-linear Autoregressive Distributed Lag (NARDL) methodologies to examine the cointegration between renewable and non-renewable energy for CO2 emissions in the near term and extended term from 1970 to 2021. The findings showed that a near-term analysis reveals an inverted U-shaped Kuznets curve, where GDP positively impacts the release of CO2 at 6,706 while GDP squared negatively affects it at -0.333. The ARDL extended-term analysis confirms this pattern, showing GDP as significantly positive at 7.505 and GDP squared as significantly negative at -0.394.