Green Horizons: Enabling the Energy Transition through Climate Change Policies

Abstract

n response to the goals set by the COP21 Summit, the challenges brought about by the COVID-19 pandemic, and the ongoing conflict between Russia and Ukraine, this study aims to develop an effective policy framework to support the transition to sustainable energy. This framework considers key elements such as managing energy risks, leveraging green finance, navigating carbon markets, and evaluating three climate change policy indicators: the impact of climate change summits (CCS), government climate programs (CCGP), and climate change taxation (CCT). Utilizing the Quantile Vector Autoregressive (QVAR) approach and analyzing monthly data from the United States from August 1, 2014, to August 30, 2022, our research examines the influential role of these climate policy indicators. The results show that climate summits, governmental initiatives, and climate taxes are significant influencers, affecting both renewable and conventional energy sectors, carbon market movements, and green finance. The study underscores the importance of government initiatives and climate policies in driving the transition to renewable energy and fostering environmentally sustainable financial activities. Focused on advancing Sustainable Development Goals 7 (Affordable and Clean Energy) and 13 (Climate Action), this research contributes to shaping effective policy frameworks and enriching policy debates on sustainable energy transition