Analyzing the effects of real income and biomass energy consumption on carbon dioxide (CO2) emissions: Empirical evidence from the panel of biomass-consuming countries

Even though the energy-growth-environment literature put a lot of effort into investigating the impact on carbon dioxide (CO2) emissions of aggregate energy consumption, aggregate renewable energy consumption and aggregate non-renewable energy consumption, the importance of biomass energy consumption for the environment is not well covered. Besides, the existing studies do not reach a consensus on the validity of the Environmental Kuznets Curve (EKC) hypothesis. Therefore, this study fulfills the gaps in the literature by investigating the impact of biomass energy consumption on CO2 emissions in the EKC model for the panel of biomass-consuming countries. By using some control variables and applying econometric approaches that take into account heterogeneity and cross-sectional dependence across countries in the panel, we find that the EKC hypothesis is valid and biomass energy consumption decreases the level of CO2 emissions. These results are supportive of the international notion that investing in biomass energy infrastructure and biomass supply are an appropriate direction the energy policy makers can use in their efforts to reduce environmental degradation in the long-run.