Does Climate Policy Uncertainty Plunge Renewable Energy Consumption? New Insights from Novel Fourier Augmented Ardl Approach

It is extensively cited that renewable energy consumption is one of the options that may lead to higher economic growth without deteriorating environmental quality. Thus, discerning its drivers is an inevitable line of research in energy economics. Although several drivers of renewable energy have been comprehensively scrutinized in the existing literature, the relationship between climate policy uncertainty on the use of renewable energy remains disregarded. Wherefore, this paper scrutinizes whether climate policy uncertainty affects renewable energy consumption in the US. We employ the novel Fourier augmented ARDL approach. The outcomes confirm that climate policy uncertainty mitigates renewable energy consumption in both the long- and short-run. Based on the results, several policy implications are reported to escalate renewable energy consumption that may help to achieve specific Sustainable Development Goals. The paper suggests that policymakers should introduce climate policies for a longer span to limit climate policy uncertainty while avoiding climate policy reversals that shrink it