Ghalieb Mutig Idroes, Iffah Hafizah, Djoni Hartono, Dian Budi Dharma, Irsan Hardi, Teuku Rizky Noviandy, Rinaldi Idroes
Hydropower presents significant environmental advantages over fossil fuels, particularly due to its minimal emissions during operation. This research examines the dynamic effects of hydropower energy consumption, fossil fuels, economic growth, manufacturing, agriculture, capital formation, and labor on CO2 emissions in Southeast Asian (SEA) countries from 2000 to 2022. Utilizing methods such as the Autoregressive Distributed Lag (ARDL), Vector Error Correction Model (VECM), and Dumitrescu-Hurlin (D-H) causality tests, the study provides empirical insights into the interactions among these variables. According to our findings, CO2 emissions decrease when hydropower energy consumption and capital formation rise. In contrast, factors such as fossil fuels, economic growth, agriculture, and labor are associated with rising CO2 emissions. The impulse response analysis indicates that shocks in hydropower energy consumption result in a decrease in CO2 emissions. Additionally, the findings reveal a bidirectional causality between CO2 emissions and hydropower energy consumption. These results underscore the critical importance of sustainable energy policies in SEA countries, promoting investment in hydropower and renewables to mitigate emissions and support environmental sustainability. To meet the region's long-term environmental and economic objectives, it is imperative to reduce reliance on fossil fuels, improve energy efficiency, and promote green technologies. © The Author(s) 2025.
Department of Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh, 23111, Indonesia; Energy and Green Economics Unit, Graha Primera Saintifika, Aceh Besar, 23371, Indonesia; The Bartlett School of Environment, Energy and Resources, University College London, London, WC1E 6BT, United Kingdom; Department of Economics, Faculty of Economics and Business, Universitas Indonesia, Jawa Barat, Depok, 16424, Indonesia; Research Cluster On Energy Modeling and Regional Economic Analysis, Department of Economics, Faculty of Economics and Business, Universitas Indonesia, Jawa Barat, Depok, 16424, Indonesia; Energy and Mineral Resources Agency of Aceh Province, Banda Aceh, 23115, Indonesia; Economic Modeling and Data Analytics Unit, Graha Primera Saintifika, Aceh Besar, 23371, Indonesia; Department of Information Systems, Faculty of Engineering, Universitas Abulyatama, Aceh Besar, 23372, Indonesia; School of Mathematics and Applied Sciences, Universitas Syiah Kuala, Banda Aceh, 23111, Indonesia
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