<p>This study examines the influence of democratic institutions, renewable energy consumption, and their combined effect on CO₂ emissions across 40 European countries from 2002 to 2022. In our analysis, we employ Fully Modified Ordinary Least Squares, Dynamic Ordinary Least Squares, the Fixed Effects OLS method with Driscoll–Kraay standard errors, the Dumitrescu–Hurlin panel causality tests, and the Method of Moments Quantile Regression approach. We provide the first comprehensive European-level analysis of democratic institutions as a moderator in the renewable energy–emissions relationship, by disaggregating democracy into distinct dimensions. Our long-run parameter estimates indicate that liberal, deliberative, egalitarian, participatory, and electoral democracies are associated with a positive impact on environmental degradation. In contrast, renewable energy consumption and its interactions with different dimensions of democracy improve environmental quality. The Dumitrescu–Hurlin causality tests reveal bidirectional causality between CO₂ emissions and GDP per capita, trade openness, renewable energy consumption, and most dimensions of democracy, except for participatory democracy. MMQR results show that democracy indices have a positive and significant direct effect on environmental degradation across most quantiles, while their interaction with renewable energy causes a negative and more pronounced effect, particularly at higher emissions levels. These findings suggest that the increasing reliance of European countries on renewable energy sources, coupled with a higher level of public engagement in the climate policy agenda, contributes to reducing environmental degradation. Broad social support and active involvement in implementing environmental strategies are likely to facilitate the achievement of the climate goals set by European countries.</p>