The Relationship of Primary Energy Consumption, Renewable Energy Consumption and Economic Growth: An Analysis on Turkey

Energy plays an important role in providing economic developments and realizing socio-economic improvements of countries. Although there are many studies dealing with the relationship between energy consumption and economic growth, one of the most discussed and emphasized in energy area in the recent years is renewable energy resources, which, on the one hand, reduce foreign-dependency of countries and, on the other hand, are extremely important in terms of environmental pollution. In this direction, in the study, adding the renewable energy consumption as a third variable to the relationship between primary energy consumption and economic growth, the renewable energy consumption and effect of renewable energy on the growth in Turkey are analyzed in the direction of Johansen Co-integration and Granger Causality test with moving from the data of the period 1975- 2016. According to the data obtained, while there is a unidirectional causality relationship from energy consumption to economic growth, there is not any causality relationship from renewable energy to economic growth. In return to this, any causality cannot be reached from economic growth to energy consumption and renewable energy.