Effect of Energy Consumption on Environment: A Case Study of China

Abstract

The issue of environmental degradation was forced by significant energy consumption. This study examined the effect of energy consumption on environmental degradation in People’s Republic of China region. To explore the relationship between dependent variables Carbon emission CO2 and independent variables Domestic Investment, Primary Energy Consumption, Population, FDI, Trade. The annual time series data used from 1990 till 2020. In this research, the study applied Ordinary Least Square Method (OLS), and Granger Causality Test. The result of OLS of model shows that there is a significantly positive impact of energy consumption, Population, Domestic Investment and, Trade on carbon emission CO2 and FDI negative impact on Carbon emission CO2.  Findings of the study suggest that to reduce the positive effects of energy use on CO2 emissions, environmentally friendly technology should be promoted alongside increases in energy efficiency.