Assessment of the environmental kuznets curve within EU-27: Steps toward environmental sustainability (1990–2019)

Abstract

Reducing environmental pollution is a critical goal in global environmental economics and economic development. The European Union (EU) faces environmental challenges due to its development activities. Here we present a comprehensive approach to assess the impact of carbon dioxide (CO₂) emissions, energy consumption (EC), population structure (POP), economy (GDP), and policies on the environment within the EU using the environmental Kuznets curve (EKC). Our research reveals that between 1990 and 2019, the EU-27 experienced an increase of +1.18 million tonnes of oil equivalent (Mtoe) per year in energy consumption (p < 0.05), while CO₂ emissions decreased by 24.25 million tonnes (Mt) per year (p < 0.05). The highest reduction in CO₂ emissions occurred in Germany (−7.52 Mt CO₂ annually), and the lowest in Latvia (−0.087 Mt CO₂ annually). The empirical EKC analysis shows an inverted-U shaped relationship between GDP and CO₂ emissions in the EU-27. Specifically, a 1% increase in GDP results in a 0.705% increase in carbon emission, while a 1% increase in GDP² leads to a 0.062% reduction in environmental pollution in the long run (p < 0.01). These findings indicate that economic development within the EU has reached a stage where economic growth positively impacts the environment. Overall, this study provides insights into the effectiveness of environmental policies in mitigating degradation and promoting green growth in the EU 27 countries.