The Relationship Between Clean Energy, Economic Growth, and Environmental Quality in Italy: Investigating the LCC Hypothesis Through NARDL Approach

As the global community addresses the pressing challenges of climate change, understanding the intricate relationship between clean energy technologies and environmental quality is crucial. This research paper focuses on Italy and utilizes data from 1977 to 2018. By employing the NARDL model, this study reveals significant and positive impacts of positive changes in clean energy technologies on load capacity factor, ultimately leading to a substantial improvement in environmental quality. Furthermore, the analysis uncovers the influence of negative shocks in clean energy technologies on the load capacity factor. The LCC hypothesis is also confirmed in the long run, providing evidence of a U-shaped relationship between per capita income and the load capacity factor. This finding underlines the importance of considering the economic dimension when assessing environmental quality. The implications of this study are particularly valuable for policymakers in Italy, as it guides them in their endeavors to bolster environmental well-being and promote a greener, sustainable economy through the efficient use of clean energy technologies.