Energy Policy 174 (2023) 113469

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Energy Policy
journal homepage: www.elsevier.com/locate/enpol

Overcoming the shock of energy depletion for energy policy? Tracing the
missing link between energy depletion, renewable energy development and
decarbonization in the USA
Mohammad Razib Hossain a, b, Sanjeet Singh c, Gagan Deep Sharma d, *,
Simona-Andreea Apostu e, f, Pooja Bansal c
a
School of Economics and Public Policy, Adelaide Business School, The University of Adelaide, Australia
b
Department of Agricultural Finance and Cooperatives, Bangabandhu Sheikh Mujibur Rahman Agricultural University, Gazipur, Bangladesh
c
University Centre for Research and Development, Chandigarh University, Gharuan, Mohali, Punjab, India
d
University School of Management Studies, Guru Gobind Singh Indraprastha University, Sector 16C, Dwarka, New Delhi, 110078, India
e
Bucharest University of Economic Studies, Romania
f
Institute of National Economy, Bucharest, Romania

A R T I C L E I N F O A B S T R A C T

Keywords: In purifying the world’s atmosphere and deterring the negative externalities from the excessive usage of fossil
Energy depletion fuels, researchers have indoctrinated the global community to look for alternatives to fossil fuels, which is also in
Non-renewable energy depletion line with the Glasgow Climate Pact (COP26). To unveil how to absorb energy depletion shock, this paper turns
Economic growth
the spotlight on the dynamic relationship between CO2 emissions, energy depletion, renewable energy devel­
CO2 emissions
Dynamic ARDL
opment, and economic growth in the USA, spanning from 1980 to 2019. We have applied the novel dynamic
USA ARDL model to reach our empirical conclusions. Our results unveil that economic growth negatively affects the
USA’s ecological balance. We observe that energy depletion negatively affects CO2 emissions in the short and
long-term, ameliorating USA’s environmental sustainability. Additionally, the transition to renewables lessens
the overall pollution in the long-run. Overall, energy depletion can fix the loopholes within the USA’s natural
environment and atmosphere; however, it can be scary for higher authorities, given that it may curb economic
growth. Therefore, the USA should judiciously estimate and juxtapose the costs and benefits of energy depletion
and transition to renewables. If the cost is too high, the country can consider a phase-to-phase transition rather
than a complete 100% transition.

1. Introduction Today’s world has unleashed many new opportunities, where energy
sources have always been key protagonists in designing new policies
Our natural environment is going through continuous hardships due (Chien, 2022). Energy has been and will remain the cornerstone of
to our insane actions. Now and then, these actions are triggering natural economic growth worldwide (Liu and Hao, 2018; Stern, 2019; K. H.
havoc, causing irreversible losses to our lives, properties, and natural Wang et al., 2021). However, the energy sources on which we rely for
resources. Developed nations have better risk absorption capacities our economic amelioration are highly sourced from the natural envi­
induced by disturbances to the natural environment due to technological ronment, most specifically the old-school fossil energies, which, if
forwardness (Afawubo and Noglo, 2022). However, developing coun­ exposed and burnt, can breed deleterious effects and cause damage to
tries suffer the most due to violations of environmental laws (Aryal et al., the earth’s natural atmospheric sustainability (Tawalbeh et al., 2021).
2020). We have witnessed that our planet has transitioned through Today, energy has become a relative indicator of how powerful a nation
various stages where the industrial revolution, staggering technological is in the global hemisphere, which is why global leaders are dedicating
advancement, urbanization, rapid economic growth, and agriculture 4.0 more money and efforts to trace new sources of petroleum hydrocarbons
are some of the significant stages we have collaboratively achieved. buried under the ground (Erdoğan et al., 2020; McBeath et al., 2022).

* Corresponding author.
E-mail addresses: mohammadrazib.hossain@adelaide.edu.au (M.R. Hossain), singh.sanjeet2008@gmail.com (S. Singh), angrishgagan@gmail.com (G.D. Sharma),
simona.apostu@csie.ase.ro (S.-A. Apostu), pbansal711@gmail.com (P. Bansal).

https://doi.org/10.1016/j.enpol.2023.113469
Received 14 October 2022; Received in revised form 19 January 2023; Accepted 26 January 2023
Available online 1 February 2023
0301-4215/© 2023 Elsevier Ltd. All rights reserved.
M.R. Hossain et al. Energy Policy 174 (2023) 113469

The expedition is not confined only to the terrestrial landscapes; for is still second to none (Forbes, 2022; World Population Review, 2022).
most littoral nations, the expedition has also found its way to the blue Additionally, regarding coal production, the USA also makes it to the top
ocean. five producers list (Global Data, 2021). Being second to none in the
The global demand for most petroleum hydrocarbons (i.e., coal, oil, production and consumption of the highly sought petroleum hydrocar­
natural gas) has been increasing unprecedently over the last few years, bons also means that the USA is approaching the end of its fossil fuel era,
except for the COVID-19 pandemic, when the demand went down where the speed of depletion has skyrocketed after the COVID-19
sharply (Khanna, 2021), causing a demand shock induced volatility in pandemic (EIA, 2023). Based on the USA’s emissions history referred
the global fossil fuel market (Wan et al., 2021). During this bumpy by the US Environmental Protection Agency (EPA, 2020), the trans­
roller-coaster ride, many strong economies have witnessed prolonged portation sector (27%) is the highest contributor to CO2 emissions,
recessions, severe unemployment issues (Su et al., 2021), and rapid followed by electricity production (25%). A recent report published by
decay in the revenue coming from the natural resource trade (Ma et al., Bloomberg (2022) claims that around 95% of US vehicles are
2021). It has been speculated that the demand for and the supply of non-electric vehicles, verifying the excessive dependence on fossil fuels,
petroleum hydrocarbons are very inelastic, meaning they are less leading to their gradual depletion. Regarding electricity production,
responsive due to the shock on the price in the short-run (EIA, 2022a).1 USA’s electricity generation is still heavily dependent on fossil fuels [
Due to the unexpected shock in the price, the oil market loses its steady fossil: renewables 80:20]. In 2021, the USA produced almost 38%, 22%,
state equilibrium and fails to get cleared due to demand and supply 20%, 19%, and 1% of its total electricity from natural gas, coal, re­
mismatch. Once the consumers adjust to the new prices, the market newables, nuclear, and other petroleum sources, respectively (EIA,
starts to get clear. Apart from the demand-supply mismatch, other sig­ 2021). We have prepared a doughnut chart to portray the statistics in
nificant factors can breed oil market volatility, changing consumption Fig. 1 below. The production, distribution, and consumption of elec­
patterns and behavior. Geo-political stability is one of the most critical tricity, which furthers economic development, incessantly fosters the
factors in keeping the oil-market volatility under control (R. Wang et al., depletion of energy sources, unleashing negative consequences on USA’s
2021; Zavadska et al., 2020), given that the ruling government controls environmental sustainability in both the short and long term.
oil fields within a specific territory. Apart from this, oil production and Contemporary scholarship on energy research and environmental
supply decisions from the Organization of the Petroleum Exporting sustainability focusing on the USA is much more diverse than other
Countries (OPEC) matter significantly in surpassing a possible developed nations. One of the reasons behind this is that the USA has
oil-market volatility. Therefore, the petroleum markets can experience constantly been named as one of the top contributors to atmospheric
recursive stages, including crude oil price bubbles (A. Khan et al., 2021; GHG emissions, regardless of the nation’s staggering technological
Umar et al., 2021) and the burst of the bubbles, which can reshape the forwardness, research and development (R&D), and economic stability.
consumption, extraction, and supply of the fossils in the international USA’s emissions-induced cumulative negative impact on the environ­
market. ment is surging rapidly. In this milieu, the nexus between the USA’s
Humans are one of the vital components of our natural environment, renewable and non-renewable energy consumption and CO2 emissions
where we share a symbiotic relationship with mother nature (Leviston has received substantial attention in the literature (see Ezici et al., 2020;
et al., 2018). The ecosystem services that we receive from nature are Pata, 2021; Salari et al., 2021). Moreover, USA’s growth-emissions
priceless. However, overexploitation of ecosystem services has posed nexus has also received sufficient attention from scholars (see Cevik
severe consequences such as global warming, a physical risk of climate et al., 2021; Raza et al., 2019; Wang et al., 2018). Additionally, the
change. Beginning with the industrial revolution, worldwide industri­ Environmental Kuznets Curve (EKC) hypothesis has received ample
alization and manufacturing of different consumable products bred attention in the literature; however, the aftermaths are equivocal (see
millions of metric tons of greenhouse gases (GHGs), including carbon Alola and Ozturk, 2021; Aslan et al., 2022; Pata, 2021; Sarkodie and
dioxide (Dong et al., 2019; Mahmood et al., 2020). For instance, ac­ Strezov, 2018). Top polluters like the USA should play leading roles in
cording to United Nations (2022) climate change report, global GHG limiting climate change, where CO2 emissions reduction needs to be
emission in the first half of 2022 was 1.2% higher than during the prioritized, among other actions. In this context, the energy depletion
pre-pandemic time. In this context, energy consumption, economic concept can be a robust instrument to dwindle emissions in the USA.
growth, and environmental degradation have become vital issues at Large economies like the USA will never be willing to compromise their
national and international levels. Considering the challenges generated economic growth by curtailing their exorbitant dependence on fossils;
by climate change worldwide, public authorities and international in­ however, the nation will undoubtedly agree to make a trade-off between
stitutions are focusing more on finding solutions to minimize the impact fossils and renewables (Pew Research Center, 2022). Willingness to
of human activity on the ecosystem. The issue is that the ecosystem has transition from fossils to renewables will mean that the energy depletion
no physical outlet and cannot communicate and say, “sorry we are out of rate has reached its highest peak unless the participating nation does it
stock.” This is on us to decide how much to consume from an ecosystem voluntarily to save the planet. At this point, failure to accomplish the
and when is the payback time. In this context, nations with an over­ transition will mean a downturn in the steady state economic growth
whelming stock of petroleum hydrocarbons have authoritative roles in (Batten et al., 2020; Semieniuk et al., 2021), which is the transition risk
controlling global carbon footprint. In this paper, we have introduced of climate change. The transition risk can be avoided with a 100%
one of these fossil fuel-rich economies and assessed the effects of the transition from fossils to renewables, and to attain that, large fossil fuel
overexploitation of petroleum hydrocarbons on CO2 emissions. To consumers like the USA should keep an eye on the depletion rate and
accomplish this endeavor, we have selected the USA case, given that the prepare well ahead of time. In this way, tracking the depletion rate can
USA is one of the largest producers and consumers of fossil energies (i.e., be a crucial instrument in controlling physical risks (i.e., environmental
coal, oil, and gas). In terms of the production and consumption of fossil hazards) as well as transition risks of climate change. However, research
fuels, the USA outwits most of its rivals. In 2021, the USA’s per capita in the depletion rate-emissions nexus domain has received scant atten­
consumption of fossils was 63,130 (kWh), which was ten times higher tion, and no research focuses on the USA’s context. Therefore, through
than what the Indian citizens consumed in 2021 (Our World in Data, this paper, we would like to fill the existing research gap. Why should
2021). Regarding the production and consumption of natural gas, the the depletion rate-emissions nexus be prioritized in energy research?
USA is the highest producer and consumer globally (World Population, The answer lies in the first fundamental theory of thermodynamics,
2022a). Moreover, in terms of oil production and consumption, the USA which relates to the conversion and transition of energy from one place
to another and one form to another. The burning of fossils primarily
generates heat, which is accountable for emissions and global warming.
1
EIA stands for U.S. Energy Information Administration. However, most renewable energies provide work rather than heat and

2
M.R. Hossain et al. Energy Policy 174 (2023) 113469

Fig. 1. Electricity production in the USA from different aggregated sources.

(Source: EIA, 2021)

work as a pro-environmental component (Eyre, 2021). The law of the context of energy-based literature. We have also controlled for
thermodynamics mostly discusses the inter-conversion of heat and work, variables like GDP growth and renewable energy consumption. The
which leads to the energy transition. Energy transition not only means present scholarship reveals substantial evidence that renewables are a
switching from high carbon-emitting sources but also means switching boon for the attainment of both economic and environmental sustain­
from heat-producing sources to work-producing sources (Eyre, 2021). ability (Hossain, 2020, 2021; Jahanger et al., 2022, 2023; Magazzino
Therefore, by evaluating the role of energy depletion on the environ­ et al., 2022; Wang et al., 2022) and, therefore, a transition from fossil
ment, this paper justifies the rationality of the first law of thermody­ fuels to renewables has been touted by environmentalists, energy
namics, given that energy depletion triggers the need for the energy economists and policymakers, which is also in line with the Paris
transition. The main lesson that can be learned from energy depletion Agreement and the Glasgow Climate Pact. However, 100% transition is
shock is that nations must adopt energy transition policies before they not possible anytime soon due to many unavoidable constraints (i.e.,
run out of fossils. Based on the above-mentioned background, we claim technological backwardness, hunger for economic growth), which per­
our novelty as follows: 1) This is the first paper in the literature focusing suades many nations to remain strongly attached to old-school fossil
on the effects of the energy depletion rate on the USA’s environmental energies (i.e., coal, gas, oil, and other mineral resources). This over­
insecurity. Most of the earlier articles have prescribed that transition exploitation of fossil fuels has led historic energy sources toward the
from fossils to renewables can assist in dwindling the atmospheric car­ brink of depletion. It is speculated that these hydrocarbons will be
bon footprint, which is a “one size fits all” type of solution without phased out in the next five to six decades, which gives goosebumps to
further justifications. Against this milieu, the inclusion of the depletion many who are not pro-environmentalists and aspire to achieve economic
rate justifies why large economies should aim 100% transition to re­ amelioration by any means. The literature in the domain of energy
newables immediately or phase-by-phase. 2) Moreover, in this paper, we research is very comprehensive, containing the findings in the context of
have controlled for variables like renewable energy consumption and cross-country studies and country-specific studies, detailing the out­
economic growth, which helps unveil how the depletion rate curbs comes of the why’s and how’s of environmental degradation. Fossil
environmental degradation in the same nexus where we are controlling fuel-fed economic development is considered a significant impediment
the effects of two other crucial variables. 3) Furthermore, this paper to the attainment of environmental sustainability in both the developed
provides a background and justifies the theoretical underpinning and West and developing South (Dogan and Ozturk, 2017; Hossain et al.,
rationality of the first law of thermodynamics. 4) Additionally, this 2022a; Pata, 2021; Ramzan et al., 2022). Moreover, asymmetries exist
paper contributes to the existing literature by incorporating the recently regarding the relationships explored, as some associations have received
developed novel dynamic ARDL model (Jordan and Philips, 2018) as our wider attention than others. Against this milieu, the CO2
primary econometric technique, which is not only commodious in pro­ emissions-energy depletion nexus has received the least attention in the
ducing quantitative coefficients by generating shock on the explanatory scholarship. We have triumphed in addressing the gaps in the literature
variables but also capable in visualizing, simulating and forecasting the in the following sections.
counterfactual effects of the explanatory variables on the dependent
variable. For the computation of the dynamic ARDL model, the “dy­
namic” package in R – software (4.2.2) and STATA (version 15) were 2.1. CO2 emissions and economic growth
used.
The rest of this paper is structured as follows: Segment 2 briefly Economic sustainability and environmental sustainability have been
discusses relevant literature in the field, Segment 3 presents the data and the most discussed concepts in this domain of energy research in the last
methodology, Segment 4 reveals major results and discussions, and two decades, where the primal focus of the researchers has been to find a
Segment 5 concludes. solution that degrades the environment as least possible and, at the same
time, does not thwart the ongoing economic development (Barbier,
2. Literature review 2009; Charfeddine et al., 2018; Goodland, 1995; Zhang et al., 2021;
Ramzan et al., 2022; Sharma et al., 2021). Down the line, the cumulative
As discussed above, we have unveiled the dynamic relationship be­ essence of the existing studies is that a trade-off exists in the form of
tween CO2 emissions and its selected determinants in the USA. In doing environmental degradation if we aspire to achieve economic develop­
so, we have evaluated the association between CO2 emissions, depletion ment fueled by historic hydrocarbons. Energy conservation strategies
of energy, and depletion of fossil fuels, a highly time-demanding topic in can be helpful; however, the opportunity cost of curtailing fossil fuel
options can be huge for many developing nations. It has been made clear

3
M.R. Hossain et al. Energy Policy 174 (2023) 113469

that the fossil fuel era is not ending soon due to the opportunity cost poverty (X. Zhao et al., 2022), which is why undivided attention to
issue and the lack of commodious alternatives (Brockway et al., 2019; ameliorating renewable energy sources is required to combat energy
Ediger, 2019; Paterson, 2021). There is also an issue with the equitable consumption heterogeneity. Studies featuring the USA have also pro­
management of the termination of fossil fuel usage (Lenferna, 2018), claimed that renewable energy development can be a boon for the USA’s
given that many developed nations (i.e., the USA, Japan) are still heavily environmental and economic sustainability, which is why financial
dependent on fossil fuels, let alone the technologically backward development in this sector has been advocated by experts (Chen et al.,
developing and least-developed countries. However, to meet the climate 2022; Pata et al., 2022). In addition, current literature also claims that
goals set by the Paris Climate Agreement, Rio Earth Summit, and the last the energy consumption heterogeneity is burgeoning in the USA, as a
COP27, we need to dwindle the consumption of fossils by any means new study notes that around 16% of the total citizens in the USA are
(Erickson et al., 2018; Piggot et al., 2020) and we need to find substitutes energy-poor (Scheier and Kittner, 2022). Therefore, renewable energy
for the fossil energies. GDP growth has been documented as the main penetration can be a holistic approach toward an inclusive and secure
protagonist behind the surge of CO2 emissions in the last few decades energy transition.
(Hossain et al., 2023), and there is a growing call to decouple economic
growth from CO2 emissions. However, it is also appalling to many that 2.3. Environmental degradation and energy depletion
absolute decoupling is impossible and can hamper economic develop­
ment if executed. For instance, Neves and Marques (2021), in their study With the growing demand for energy across the world, energy se­
in the USA, noted that the number of alternatives to fossils is still curity has become one of the major concerns for many nations, showing
insufficient in the USA, and a transition from fossils to alternative en­ us the severity of the dual problem (i.e., meeting environmental integ­
ergies can bring deleterious effects on USA’s economic growth. More­ rity on the one hand and ensuring sufficient energy for all on the other)
over, despite the claim of attaining absolute decoupling followed by in the strand of energy research. The overexploitation of ecosystem
astounding investment in renewables, some nations (i.e., China and services has created hardships for our environment as the natural
India) are still at the bottom of the ladder in satisfying the emissions environment fails to rekindle its original biocapacity. Contemporary
targets (see Wang et al., 2019; Wei et al., 2020). Moreover, the esti­ scholarship in energy research is teeming with the dynamics of re­
mations within the Environmental Kuznets Curve (EKC) hypothesis lationships between natural resource abundance and environmental
framework also divulge conflicting outcomes across the cross-country pollution, unraveling both positive and non-positive associations in the
and country-specific studies, which indicate possible loopholes in the nexus. For instance, Balsalobre-Lorente et al. (2018) highlighted a
selection of variables, estimation procedures, and construction of hy­ negative association between natural resources rent and environmental
potheses. Based on our thorough analysis, we unravel that conflicting degradation among selected European nations from 1985 to 2016. Be­
observations exist in USA’s EKC hypothesis domain. For instance, Dogan sides, Zahoor et al. (2022) further unveiled a non-positive association in
and Turkekul (2016) and Dogan and Ozturk (2017) failed to validate the the nexus in China. Contrarily, Langnel et al. (2021) disclosed that
EKC hypothesis in the USA. Contrarily, some other studies unveiled the natural resource abundance is pernicious for the environment among
presence of the EKC hypothesis in the USA (Alola and Ozturk, 2021; the Economic Community of West African States (ECOWAS) member
Aslan et al., 2018; Pata, 2021). Scholars have also reported significant countries. Bekun et al. (2019) also documented a homogenous positive
heterogeneities in the state-level studies focusing on the USA (Işık et al., association among 16 selected European Union nations. Moreover,
2019a; Isik et al., 2019). studies have also pointed out heterogeneity in terms of the relationship
in the nexus across different quantiles and countries within a panel (see
2.2. CO2 emissions and renewable energy consumption Altinoz and Dogan, 2021; Nathaniel, 2021). Thus, it is discernible that
ambiguity exists in the nexus, a concern that needs to be addressed.
As touted by environmentalists, energy economists, and policy­ However, the most alarming concern about natural resources is that the
makers, renewable energy sources have immense potential to dwindle stock of non-renewable resources is gradually depleting. This depletion
the ongoing emissions. Studies in the CO2 emissions-renewables usage is irredeemable and has other fatal consequences, which have started to
nexus have postulated that due to environmental safety concerns as well unfold one by one. The price of fossil energies (i.e., coal, oil, gas) is
as energy safety issues, we need to choose an energy mix that contains skyrocketing every year, posing unavoidable burdens on the nations that
more renewable energy options compared to its fossil counterparts mostly rely on importing non-renewable energies from other countries.
(Hashemizadeh et al., 2022; Hossain et al., 2022b; Rehman et al., 2022; Amid the depletion, resource-rich nations like the USA, Russia, and
Seriño, 2022; Chopra et al., 2022; J. Zhao et al., 2022). However, we Saudi Arabia are earning hefty amounts from the trade of these valuable
observed an unprecedented gap between ambition and reality regarding resources. Therefore, the depletion of non-renewable energies means
renewable consumption across different countries. Although the situa­ more exploitation of fossils and augmented consumption of fossils,
tion is improving in mitigating the augmented demand-supply mismatch which can severely jeopardize environmental integrity (Abbasi et al.,
of energies, the contribution of renewables is still the tip of the iceberg 2021a,b; Hussain et al., 2020; I. Khan et al., 2021). Apart from this,
and needs to be boosted exponentially. It is also true that there are incessant fossil mining can be detrimental to the ecosystem, biodiver­
constraints that can significantly hinder the progress toward the sity, and the planet as a whole. To thwart the depletion of energy, effi­
amelioration of renewable energy development. Investment in techno­ cient energy usage must be ensured through sane usage of power,
logical advancement and infrastructural development has been identi­ technological advancement, mitigating the power distribution loss, and
fied as one of the significant barriers to renewable energy penetration managing sustainable energy storage systems through the development
across many nations globally. For instance, Oryani et al. (2021) docu­ of batteries. Furthermore, our analysis of the contemporary literature
mented that lack of investment is one of the significant limitations for also divulges that equivocal findings persist in the context of the USA
the flourishment of renewable energy development in Iran. Homoge­ regarding the natural resource-environmental degradation nexus, where
nous findings have also been revealed by Appiah-Otoo et al. (2022), K. Khan et al. (2021) and Zafar et al. (2019) unraveled negative asso­
Qadir et al. (2021), and Shahbaz et al. (2021) across many other ciation and Huang et al. (2021) noted a positive connection.
developed and developing nations. Among others, keeping up with the Overall, our thorough literature review in the context mentioned
current economic growth is another barrier to ameliorating renewables above discloses the following gaps in the literature. Firstly, the number
as it impedes the positive spillovers of renewable energy sources. Many of empirical works portraying the natural resource-CO2 emissions nexus
unforeseeable events (i.e., the Covid-19 pandemic) can also bolster the in the context of the USA is very scant. The USA is a resource-rich nation
consumption of fossils (Billon et al., 2021; Smith et al., 2021). Moreover, where insufficient research in the mentioned domain may lead to
renewable energy penetration can also support alleviating energy loopholes in policymaking, leading to inaccurate forecasting in resource

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

availability, exploitation, and consumption. Secondly, the current 3.2. Model specification and modelling approach
literature is excessively biased, given that it has mostly focused on the
natural resource abundance side and its effect on environmental The present manuscript analyses the impressions of GDP, ED, RE, and
degradation, ignoring the depletion of the non-renewable resources and NRED on CO2 emissions (dependent variable), using the novel dynamic
its consequences on CO2 emissions, at least in the case of the USA, one of ARDL simulation method. This methodological approach aims to surpass
largest producers and consumers of fossil energies of the world. Thirdly, the challenges of the conventional ARDL model in examining multifac­
there is no study so far detailing the extent to which the depletion of eted parameters in the long and short run. Following Morshed and
energy can have a moderating impact on the exploitation of renewable Hossain (2022), we have constructed our basic model as follows:
and fossil energy sources on environmental degradation.
CO2 = f (GDP, ED, RE, NRED) (1)
3. Data and methodology with intercept and coefficient terms, Eq. (1) can be written as follows:

3.1. Data and their descriptions CO2t = β0 + β1 GDPt + β2 EDt + β3 REt + β4 NREDt + εt (2)

This study examines the relationship between energy depletion (ED), Where β0 is the constant and β1 − β4 are the coefficients of independent
renewable energy (RE), non-renewable energy depletion (NRED), gross variables and εt stands as the white noise error term.
domestic product (GDP), and carbon dioxide emissions (CO2) in the This paper applies a novel dynamic ARDL simulation method to
USA. The annual time series data from 1980 to 2019 are employed in the analyze the dynamic response of a dependent variable caused by
current study to capture the empirical associations between the explanatory variables. To accomplish the dynamic ARDL approach, we
explanatory and response variables. We selected this timeframe based have undertaken the following steps:
on the availability of data on our designated variables, given that some
variables had missing values prior to 1980. The designated variables 1. Before proceeding to the empirical modelling, we must check the
used in this paper have been selected based on the research questions of stationary properties of our modeled variables, given that statio­
this paper. Among the explanatory variables, economic growth has been narity is one of the critical attributes of time series. The stationarity
captured using the GDP (in constant 2015 US$) data, followed by the of variables is tested by applying several unit roots tests such as the
progress in the recent scholarship (see Khan et al., 2022; Mohsin et al., augmented Dickey-Fuller (ADF) test (Dickey and Fuller, 1979),
2022). We chose GDP to proxy economic growth, given that GDP reflects Kwiatkowski–Phillips–Schmidt–Shin (KPSS) (Kwiatkowski et al.,
an economy’s accurate size and output generation capacity (Harvard 1992) test, and Philips Perron (PP) test (Phillips and Perron, 1988) at
Business Review, 2019). The effect of renewable energy consumption both level and first differences. For implementing ARDL/DARDL
(RE) is captured by the quantity of renewable energy consumed, approach, the dependent variables must be I (1) stationary, where all
expressed in the British Thermal Unit (BTU). We used this variable fol­ of the explanatory variables have to be either level-stationary or
lowed by the progress in the recent scholarship (Ehigiamusoe and first-difference stationary. The second step involves the selection of
Dogan, 2022; Miao et al., 2022). RE has been selected as it represents the the optimum lag length based on various selection criteria - Schwarz
actual consumption scenario of renewables. Moreover, the energy Information Criteria (SIC), Hannan-Quinn (HQ) Information Criteria,
depletion rate (ED) has been proxied by the adjusted savings (in current Akaike Information Criteria (AIC), Adjusted R-squared and Final
US$), followed by Abbasi et al. (2021a,b). Adjusted saving has been Prediction Error (FPE). The ARDL model is specified based on the
chosen to proxy ED as the adjusted savings (% of GNI) is estimated as a selected optimal lag length.
ratio between the available energy stock’s total value and the remaining 2. After determining the unit root properties and lag order, before
reserve lifetime (World Bank, 2023). Additionally, non-renewable en­ jumping into the estimation of the long and short-term coefficients,
ergy depletion (NRED) is used as an interaction term, followed by Abbasi we need to test the presence of a cointegrating relationship between
et al. (2021a,b), taking the non-renewable energy and depletion rate CO2 emissions and its selected determinants. The long-term cointe­
into account. Finally, we have captured the environmental degradation gration of the unconditional linear corrected model (ULCM) is esti­
using CO2 emissions (in metric tons per capita), followed by Abbasi et al. mated based on the ARDL model with its different bounds for testing
(2022), Liu et al. (2022), and others. The data were collected from given by Eq. (3).
multiple sources, including the World Development Indicators (WDI) of ΔCO2t = α0 + λ0 CO2t− 1 + λ1 GDPt− 1 + λ2 EDt− 1 + λ3 REt− 1 + λ4 NREDt− 1
the World Bank (2020), the US Energy Information Administration (EIA, p q1 q2
∑ ∑ ∑
2020), and Our World in Data (2020). The source and description of the + αi ΔCO2(t− i) + β1i ΔGDPt− i + β2i ΔEDt−
(3)
i
data are specified in Table 1 below. 1 1 1
q3
∑ q4
∑
+ β3i ΔREt− i + β4i ΔNREDt− i + εt
1 1

Where “Δ” divulges the first-difference operator and p denotes the

optimal lag length of CO2 and q1 − q4 denotes the optimal lag lengths of
Table 1 GDP, ED, RE and NRED, respectively. Moreover, λ1 − λ4 and β1 − β4
Source and description of parameters.
stand for the long- and short-term coefficients, respectively. The F-sta­
Sl. Data Description Units of Source tistics bound test is compared with upper and lower fixed critical bounds
No. label measurement to study long-term cointegration between CO2 emissions and its selected
1. GDP Gross Domestic Constant 2015 World Bank determinants. Based on Pesaran et al. (2001) approach the null and
Product US$ (2020) alternative hypotheses are:
2. CO2 Carbon dioxide Metric tons per EIA (2020)
Emissions capita H0 : λ1 = … = λ4 = 0
3. ED Adjusted Savings Current US $ World Bank
Energy Depletion (2020)
H0 : λ 1 ∕
=… ∕
= λ4 ∕
=0
4. RE Renewable Energy Quad BTU EIA (2020)
Consumption The possible results are:
5. NRED Non-Renewable TWH Our World in
Energy Depletion Data (2020)

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

• F-statistics > critical value of upper bound (Long-term cointegration) depicts the highest mean among the selected variables, and RE depicts
• F-statistics < critical value of lower bound (No long-term the lowest mean. Besides, the standard deviations across all the chosen
cointegration) variables are very low, indicating less variability across the data points
• The calculated F-statistic falls within the lower and upper limits (No over time, which also delineates and cancels out the possibility of out­
conclusive result. However, negative and significant ECM indicates liers. From the kurtosis analysis, we unravel that ED and NRED show
long -run cointegration) heavier tails as the values surpass and stay well above a standard limit
1. The Error correction model (ECM) is defined as three, whereas other variables have lighter tails as they fail to meet the
standard limit. Regarding the skewness analysis, all the variables are
ΔCO2t = α0 + λ0 CO2(t− + λ1 GDPt− 1 + λ2 EDt− 1 + λ3 REt− 1 + λ4 NREDt−
1) 1
skewed with a left-tail distribution except for RE, which is skewed with a
right-tail distribution. ED has the most extended left-tail distribution
p
∑ q1
∑ q2
∑
+ αi ΔCO2(t− i) + β1i ΔGDPt− i + β2i ΔEDt−
among all the modeled variables. Moreover, the Jarque-Bera test sta­
i
1 1 1
q3
∑ q4
∑ tistics reveal that GDP and CO2 are normally distributed as we fail to
+ β3i ΔREt− i + β4i ΔNREDt− i + ∅1 ECTt− 1 + εt reject the null of normality. Contrarily, for variables ED, RE, and NRED,
1 1 the test statistics are very high, and we can reject the null of normality at
(4) a 5% level of significance.
The term ECTt− 1 in Eq. (4) indicates the one-lagged error correction After our preliminary assessment, we assessed the stationarity status
term (ECT). ECT must be negative and significant to adjust any shock in of our selected variables. We deployed multiple unit root tests to obtain
the short-term towards the long-run equilibrium. our research objectives. We have placed the findings in Table 3 below. It
is conspicuous that our chosen variables are non-stationary at the level,
1. Moreover, we have deployed several diagnostic tests to check the as referred to by the ADF and PP test statistics, except for ED and NRED,
serial autocorrelation, heteroskedasticity, normality of residuals, and which are stationary at the level at a 5% level of significance. However,
model specification. This step is crucial to represent and testify that the KPSS test delineates that all our modeled variables are stationary at
our model is reliable and that the outcomes produced are efficient the level at 5% significance level, except for NRED. Moreover, after the
and replicable. first difference, we note that all our variables become stationary under
the PP test. Therefore, we can conclude that all the roots of the modeled
Once we are done with the above-mentioned econometric ap­ variables lie within the unit circle, as there is no unit root issue. Also, we
proaches, we can proceed with our final econometric technique, the confirm a mixed order of integration [I (0) and I (1)] among the vari­
novel dynamic ARDL (DARDL) model (Jordan and Philips, 2018). The ables. In this milieu, the ARDL model is the best fit to tackle the mixed-
DARDL model can effectively measure both short and long-run co­ order integration among the variables. Therefore, we have exploited the
efficients from the shocks on the explanatory variables in the model. advanced novel dynamic ARDL framework to identify the long-term
This is a simple model to be estimated compared to the conventional relationships between CO2 emissions and its selected determinants in
ARDL framework, which poses challenges due to its complex structure. the USA.
Moreover, the DARDL method facilitates by producing dynamic coun­ After confirming that there is no unit root issue among the variables,
terfactual images of the dynamics of relationships between a dependent we switch to the lag selection criteria. The findings are displayed in
and an independent variable through visual plots. The change in each Table 4 below. We harnessed the AIC, SBIC, and HQIC criteria to select
regressor and its impact on the response variable can be identified the appropriate lag for our model. AIC and HQIC criteria select a lag
individually by keeping the effect of other independent variables con­ order of four, whereas SBIC selects a lag order of one. Among these
stant. The DARDL model is given as: criteria, SBIC is more useful in selecting a correct model, and AIC is more
appropriate in finding the best model for predicting future observations.
ΔCO2t = α0 + λ0 CO2(t− 1) + λ1 GDPt− 1 + λ2 EDt− 1 + λ3 REt− 1 + λ4 NREDt− 1 Our aim is to choose the most parsimonious model to avoid multi­
+ β1 ΔGDPt + β2 ΔEDt + β3 ΔREt + β4 ΔNREDt + ∅1 ECTt− 1 + εt collinearity, serial autocorrelation, and misspecification of errors.
(5) Keeping this in mind, we chose the SBIC criterion and selected lag order
one for our empirical model.
With λi s and βi s are long and short -run coefficients, respectively. We employed the ARDL bounds test to determine the existence of a
′ ′

long-run cointegrating relationship between CO2 emissions and its

4. Results and discussion selected determinants. The outcomes are posted in Table 5 below. Based
on the estimation, the F-statistic (7.051) is greater than all the upper and
4.1. Descriptive statistics, unit root, lag selection, and cointegration test lower bound values, depicting that we can reject the null hypothesis of
findings no level relationship and endorse that a long-run relationship exists
between CO2 emissions and its selected parameters (ED, GDP, NRED,
At the beginning of our econometric analysis, we conducted a sum­
mary check for all our modeled variables. The results of the same are
summarized in Table 2 below. It is discernible that the obtained mean Table 3
(both minimum and maximum) across all variables is positive. NRED Unit root results.
Variables ADF KPSS PP
Table 2 Level GDP − 1.51 1.09* − 2.84
Summary statistics. ED − 2.49 0.10* − 21.36*
RE − 1.57 0.81* − 3.88
Statistics GDP ED RE NRED CO2
NRED − 2.37 0.09 − 21.08*
Mean 30.16 24.58 1.94 34.54 8.57 CO2 − 0.94 0.58* − 1.28
Standard deviation 0.32 0.60 0.23 0.61 0.09 First Difference Δ GDP − 2.78 0.13 − 23.02*
Min 29.59 22.14 1.64 32.12 8.39 Δ ED − 3.18 0.19 − 40.03*
Max 30.63 25.66 2.44 35.69 8.70 Δ RE − 3.52 0.34 − 37.16*
Skewness − 0.32 − 1.63 1.01 − 1.41 − 0.36 Δ NRED − 3.13 0.15 − 39.77*
Kurtosis − 1.19 5.96 − 0.21 5.09 − 0.67 Δ CO2 − 2.79 0.33 − 31.45*
Jarque-Bera test 3.003 59.62* 6.43* 43.5* 1.724
Note: ‘*’ indicates that p-values significant at 5% significance level, ‘Δ’ repre­
Note: ‘*’ divulges that p-values significant at 5% level of significance. sents the first difference symbol.

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

Table 4
Lag order selection.
Lag logL LR FPE AIC HQIC SBIC

0 176.486 5e-11 − 9.53 − 9.45 − 9.31

1 391.464 429.96 1.3e-15 − 20.08 − 19.62 − 18.76***
2 405.904 28.882 2.6e-15 − 19.49 − 18.65 − 17.07
3 453.281 94.753 9.5e-16 − 20.74 − 19.51 − 17.22
4 495.074 83.586*** 6.2e-16*** − 21.67*** − 20.06*** − 17.05

Note: “LR” denotes sequential modified LR test statistic, “FPE” refers to final prediction error, “HQIC” is Hannan-Quinn information criterion, SBIC is Schwarz Bayesian
information criterion. “*” divulges lag order selected by each criterion.

Consequently, the USA’s concern is only maintaining the steady-state

Table 5
growth level throughout its fiscal years. To maintain the steady-state
ARDL bound test analysis.
growth level, USA’s economic activities remain highly driven by the
Test statistic value k H0 H1 exploitation and consumption of natural resources, where the extraction
F-stat 7.051*** 4 No level Relationship brings deleterious consequences on environmental sustainability. At the
t-stat − 0.725 relationship exists disaggregated level of natural resource consumption, the USA is still
Critical values
highly dependent on fossil fuels (i.e., petroleum, natural gas, and coal)
Significance F-stat t-stat
level I (0) I (1) I (0) I (1) to escalate its economic performance. According to the US Energy In­
10% 2.66 3.84 − 2.57 − 3.66 formation Administration (EIA, 2022b), in 2021, the USA consumed
5% 3.20 4.54 − 2.86 − 3.99 around 546 million short tons (MMst) of coal, which met 11% of the
1% 4.43 6.25 − 3.43 − 4.60 USA’s total primary demand. It is also notable from the observation of
Note: *** indicates 1% level of significance. EIA that, in 2021, 36% of the total energy supply came from petroleum
hydrocarbons, 32% came from natural gas, and the rest came from nu­
and RE) in the USA. clear and renewable sources (EIA, 2022c). CO2 emissions have the
highest contribution toward the atmospheric greenhouse gas emissions
in the USA, accounting for around 80% of total GHG emissions in the
4.2. Findings of the dynamic ARDL model USA in 2020 (EIA, 2022d). However, a paradigm shift is apparent in the
trend of growth-induced CO2 emissions in the USA as the nation at­
As mentioned earlier, we have exploited the dynamic ARDL (DARDL) tempts to obtain the green growth myth (another American dream),
model to estimate the short and long-term elasticities of the explanatory which falls within the country’s Nationally Determined Contributions
variables in the model. The DARDL model is a modified ARDL model, (NDCs) list to dwindle the CO2 emissions by 2030 and attain net zero
which captures the effect of each regressor on the response variable emissions by 2050. The green growth initiative has escalated the call to
(CO2 in this case), keeping all other variables constant. The DARDL decouple economic growth from fossil fuel, which is perceptible from
framework also cushions the simulations of the modeled explanatory the USA’s latest investment initiative in renewable energy development.
variables and demonstrates the counterfactual mutation, which is a Due to the USA’s green growth initiative, the long-term effect of eco­
robust way of finding the original effect of the model parameters on the nomic growth will be insignificant on CO2 emissions, which the findings
outcome variable. The results of the DARDL model are summarized in of this paper have endorsed. Furthermore, the transition to green growth
Table 6 below. The examined outcome unravels that with all other re­ can boost economic activities in the long-term by creating more job
gressors remaining constant, a 1% boost in the GDP escalates the CO2 facilities in the renewable sectors, corroborated by Georgeson and
emissions by 0.04% in the short-term. Contrary to this positive associ­ Maslin (2019) in the context of the USA.
ation, we find a non-positive association in the nexus in the long-term; Moreover, it is also perceptible that energy depletion is negatively
however, the outcome is statistically insignificant. Regarding the entangled with CO2 emissions in the USA. In other words, a 1% inflation
finding of the short-run effect, our observation is in line with that of in ED dwindles the CO2 emissions by 0.98% and 0.1% in the short and
Ortega-Ruiz et al. (2022), Pata (2021), and Wang et al. (2019), who long-term, respectively. The coefficients are significant at a 5% and 10%
highlighted similar views in the case of the USA. The apparent short-run significance level, respectively. The energy depletion rate indicates the
effect, which is positive, makes sense and can be corroborated in the extreme pressure on ecosystem services coming from natural resource
context of the USA. The US economy is unique regarding its shock ab­ exploitation and consumption. An upsurge in the depletion rate cor­
sorption capacity, size, and percentage share of total global output roborates that consumption of natural resources at both aggregated and
(Focus Economics, 2022), facilitating steady-state economic growth. disaggregated levels has increased within a certain time frame, leading
to a stock of natural resources that is diminishing over time. As the
Table 6 supply of natural resources (i.e., fossils at the aggregated and dis­
Dynamic ARDL simulation outcomes. aggregated levels) becomes limited, we observe less extraction of fossils
Variable Coefficient Std. Error t-values followed by discounted consumption of fossils and other energy options,
which ultimately thwarts the level of CO2 emissions. This negative
Constant 0.021 0.006 3.303 ***
ECTt-1 − 0.32 0.107 − 3.012 *** relationship is also justified because ecosystem services take time to
GDPt-1 − 0.011 0.009 − 1.18 restore to their earlier capacities, where overexploitation impedes the
Δ GDPt-1 0.044 0.01 4.454 *** recovery rate significantly. For instance, it took millions of years for
EDt-1 − 0.093 0.049 − 1.89 * these fossil energies to be produced, which the USA and other nations
Δ EDt-1 − 0.985 0.459 − 2.144**
REt-1 − 0.014 0.006 − 2.29 **
have been consuming, and once finished, it is unclear when new sources
Δ REt-1 0.0006 0.001 0.59 will evolve. Therefore, this relationship in the nexus of ED-CO2 emis­
NREDt-1 0.0950 0.054 1.749* sions calls for immediate actions to rely more on renewable energy
Δ NREDt-1 0.988 0.44 2.243** sources and to keep untapped what is left of the fossils, at least for the
(adj) R2 0.699 F-stat (p-value) 10.81(<0.001) **
oncoming generations. Our observation is in line with that of Abbasi
Note: ***, ** and * represent 1%, 5% and 10% level of significance, respectively, et al. (2021a,b) in Thailand.
“Δ” indicates the short-run elasticities.

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

Additionally, we discovered that renewable energy consumption consumption basket and divert the consumption toward more sustain­
shares a non-positive relationship with CO2 emissions in the USA in the able fuel options like renewables and nuclear energies. Our findings are
long-term. Put it differently, a 1% upsurge in renewables consumption also in line with Abbasi et al. (2021a,b) in the case of Thailand.
thwarts environmental degradation by 0.01% in the long-term, whereas Table 6 also delineates that the error correction term (ECT) is
the short-run effect is insignificant. This finding is interesting and aligns negative and highly significant at a 1% significance level. The coefficient
with USA’s green growth agenda. The consumption of renewables also of ECT (− 0.32) unravels that our model attains its long-run equilibrium
indirectly means the consumption of electricity from renewable sources. at a speed of adjustment of 32%/year. The adjusted- R squared value is
Due to its geophysical attributes and geographical structure, the USA 0.7, which depicts that the explanatory variables of our model can
holds immense potential to generate renewable electricity that can explain almost 70% of the total variation in the dependent variable.
significantly motivate the nation’s green growth directory. Based on the
EIA’s latest observation on the progress of the USA’s renewable goals, in
4.3. Visualization of the counterfactual changes
2021, the nation managed to produce around 20% of its total electricity
from renewable sources (EIA, 2022e), commendable progress amid the
We used the DARDL model for an additional benefit that the con­
Covid-19 pandemic. However, abatement of coal consumption has been
ventional ARDL model fails to accommodate. The DARDL model assists
USA’s main challenge towards the transition to renewables, given that
in visualizing, estimating, forecasting, and predicting the counterfactual
coal is cheap and readily available in the USA. Against this backdrop, the
changes in the dependent variable coming from the shock on selected
Biden administration in the USA aspires to produce 100% clean elec­
regressors. The DARDL simulations automatically plot the forecasts of
tricity by 2035 (The Washington Post, 2020), which can fade away due
actual regressor change and their effect on the dependent variable while
to excessive dependence on fossils. The global energy crisis, the
keeping other explanatory variables constant. The counterfactual sim­
COVID-19 pandemic, the Russian invasion of Ukraine, and other un­
ulations captured by the dynamic ARDL model are portrayed in the
certainties have led many nations to depend more on fossils, and the
figures below. The black dots refer to the average prediction values, and
USA is one of them, where post-pandemic coal consumption is
the dark blue to light blue lines refer to 70%, 90%, and 95% confidence
increasing rapidly (Bloomberg, 2021). Therefore, to keep up with
intervals, respectively. Fig. 2 below portrays the response of CO2
president Biden’s ambitious climate goals and Paris Agreement, the
emissions due to a 10% positive and negative shock on GDP in the USA.
USA, at this stage, needs a boost in its renewable investment plan, which
It is apparent from Fig. 2 that a positive 10% change in GDP tends to
can foster the shutdown of coal-fired power stations and will also curtail
plunge the CO2 emissions in both the short and long-term; however, the
the depletion of energy. The finding of this paper is homogenous to that
long-term effect is more extreme compared to the short-term impact.
of Pata (2021), Saidi and Omri (2020), Sharif et al. (2019), and Yu et al.
Contrarily, a 10% negative shock on GDP escalates the CO2 emissions in
(2022). Furthermore, the depletion of non-renewable energy (NRED) is
the long-term, as depicted in Fig. 2 below. Moreover, Fig. 3 illustrates
positively connected with CO2 emissions in the USA. In other words, a
the change in CO2 emissions due to the shock in ED. It is conspicuous
1% rise in NRED escalates the CO2 emissions by 0.09% and 0.9% in the
that a 10% positive change in ED dwindles the CO2 emissions in the
long and short-term, respectively. The findings are significant at 10%
long-term, whereas there is no momentous change in the short-term.
and 5% significance levels, respectively. The depletion of non-renewable
Conversely, a 10% negative shock in ED generates no meaningful dif­
energy sources mostly represents the over-exploitation of fossils at both
ference in CO2 emissions in the short-term; however, we unveil pro­
aggregated and disaggregated levels. In the case of the USA, the current
longed escalation in the emissions history in the long-term.
exploitation of natural resources and fossils, generation of fossil-based
The response to CO2 emissions due to the positive and negative
electricity, and over-exploitation of ecosystem services are in harmony
shocks on RE has been captured in Fig. 4. It is discernible that a 10%
with our findings. Our observation also delineates that the USA is the
positive shock on RE dwindles the CO2 emissions in the short and long-
sole consumer of its extracted fossils (i.e., coal, gas, and oil), given that
term, whereas a 10% negative shock on RE boosts the CO2 emissions in
the depletion augments USA’s environmental pollution in the short and
the short and long-term. Similarly, the response to CO2 emissions due to
long-term. Therefore, we propose that the USA diversify its energy
the positive and non-positive shocks on NRED has been captured in

Fig. 2. Impulse response plot of GDP on CO2 emissions.

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

Fig. 3. Impulse response plot of ED on CO2 emissions.

Fig. 4. Impulse response plot of RE on CO2 emissions.

Fig. 5. Impulse response plot of NRED on CO2 emissions.

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

Fig. 5 below. It is perceptible that a positive 10% change does not Table 7
generate any remarkable shift in the CO2 emissions history in the short- Diagnostic test results.
term. However, CO2 emissions soar in the long-term. Conversely, a 10% Tests Test p- Test result
negative change in NRED dwindles the CO2 emissions in the long-term stat values
in the USA, whereas the short-term change is very flimsy. Breusch-Godfrey LM 0.34 0.559 No Evidence of serial
We conducted a few relevant diagnostic tests to check the stability autocorrelation
and robustness of our empirical model. The diagnostic test outcomes are Breusch-Pagan-Godfrey 0.00 0.99 No evidence of
aligned in Table 7 above. It is evident from the results that our model is heteroskedasticity
Ramsey RESET test 1.37 0.267 Model specified correctly
free from any serial autocorrelation, as suggested by the Breusch- Shapiro-Wilk Test for 0.981 0.738 Residuals are normally
Godfrey LM test. The Breusch-Pagan-Godfrey test also corroborates Normality distributed
that our model is free from heteroskedasticity issues. Moreover, the
Ramsey RESET test divulges that our model is correctly specified, and
there is no omitted variable bias issue. Furthermore, the Shapiro-Wilk more time in generating workhorse models that can mitigate the crisis of
Test for Normality delineates that the residuals are normally distributed. energy depletion, which will materialize as the historic fossil fuels get
depleted in the next five to six decades.
5. Conclusion and policy implications The overall findings of this paper unravel that, being a top CO2
emitter of the world, this is high time that the USA focuses more on
Through this paper, we endeavored to establish a dynamic link be­ sustainable energy options, which can be a boon for the USA’s economic
tween the breach of environmental integrity, depletion of energy, and and environmental sustainability. The energy diversification strategy
depletion of non-renewable energy sources in the USA, while controlling needs to be more policy-oriented, where the USA’s focus should be on
for economic growth and renewable energy consumption. The USA is the transition process to renewables. The current depletion rate of the
one of the world’s largest economies, where the overall economic system fossils is alarming, and for many nations like the USA, which are highly
primarily relies on historical fossil fuels, the main protagonist behind dependent on fossils, this is a desperate time. A high depletion rate also
global warming. It is cumbersome for many nations to switch from indicates that the USA’s economic sustainability will face severe issues
fossils to other alternative energy options that have been touted as clean in the long-term, which is highly reliant on the incessant supply of
and environmentally friendly. However, for a top polluter like the USA, fossils. Therefore, at this point, higher authorities in the USA should
the transition needs to be made for the sake of the global environment, focus more on the 100% transition to renewable energies. However, at
which requires that policymakers, thinktanks, and researchers unveil the same time, it is also important that the country makes judicious
the why’s and the how’s of the transition that can ensure the most decisions regarding the transition so that it receives the least negative
positive spillover for the environment and least negative spillover for the impact on its economic activities. The transition process has to be
economic sustainability. To achieve this research objective, we have balanced, adjusted, and phase-by-phase depending on the overall eco­
introduced the negative consequences of the overexploitation of nomic condition. Moreover, the Biden administration needs to invest
ecosystem services within a nexus of renewable energy development and more in R&D to equip the nation’s renewable industry with better
economic growth. Hence, this paper evaluates the pattern of the rela­ environment-friendly technologies to curb ongoing emissions. Overall,
tionship between CO2 emissions, ED, RE, GDP, and NRED, using the we suggest that the policymakers of the USA make a trade-off between
time-series data from 1980 to 2019. We endeavored to unearth the fossil fuel and renewable energy options, depending on the overall status
consequences of the energy depletion on environmental integrity in the of the US economy. The ratio between the former and the latter should
USA, which remained uncharted for a long time, while we controlled for be less than one to keep the warming level below the desired limit. We
the effects of the variables like GDP, and RE. We deployed a series of claim that our study is novel; however, it also has some limitations. We
econometric techniques to generate reliable and replicable outcomes. could not accommodate a large sample size due to the unavailability of
The final modelling has been accomplished by deploying the novel data. Besides, we had to exclude a few parameters due to their missing
DARDL model due to its superiority over the conventional ARDL values. Therefore, future studies can be conducted using additional
method. control variables if data availability approves that. Moreover, a panel
The findings of our paper depict that economic activities and growth data study based on the same sets of variables is highly encouraged,
hypothesis pose deleterious effects on the USA’s environmental sus­ comprising the top emitters of the world.
tainability only in the short-term. The impact of renewable energy
consumption is non-negative in the long-term, as expected, indicating CRediT authorship contribution statement
that consumption of renewable energies can be a boon for the USA’s
long-term environmental goals. The effect of ED, the main variable of Mohammad Razib Hossain: Data curation, Writing – original draft.
interest in this paper, is negative on CO2 emissions in both the short and Sanjeet Singh: Methodology, Software. Gagan Deep Sharma:
long-term. Finally, the impression of the interaction term between non- Conceptualization, Writing – review & editingWriting- Reviewing and
renewable energy use and depletion rate (NRED) is found to be non- Editing. Simona-Andreea Apostu: Software, Validation. Pooja Bansal:
negative in both the short and long-term. Moreover, this paper makes Visualization, Investigation.
the following contribution to the existing literature. 1) By unveiling the
dynamic relationship in the energy depletion-CO2 emissions nexus, this Declaration of competing interest
paper points out the rationality of why the USA and other top emitters
should allocate more time, effort, and financial assistance in the energy The authors declare that they have no known competing financial
conversion and transition process, which is deemed to be the best interests or personal relationships that could have appeared to influence
strategy toward the attainment of net-zero emissions target by 2050.2) the work reported in this paper.
The findings of this paper concur with the theoretical underpinnings of
thermodynamics by providing the rationality of the inter-conversion of Data availability
heat to work, where the former degrades environmental integrity, and
the latter ameliorates environmental health. 3) The findings of this Data will be made available on request.
paper also delineate that energy depletion can be shocking; however, it
unleashes new trajectories to find alternatives to fossils in the long-term.
In this milieu, this study suggests that policymakers as front liners invest

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M.R. Hossain et al. Energy Policy 174 (2023) 113469

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