CLEAN ENERGY TRANSITION AND TECHNOLOGICAL INNOVATION FOR ENVIRONMENTAL SUSTAINABILITY: NEW EVIDENCE FROM LOAD CAPACITY FACTOR AND QUANTILE DYNAMICS IN BRICS ECONOMIES

Abstract

Environmental sustainability is a critical challenge for developing economies, particularly the BRICS nations, given their significant contributions to global economic activity and the environmental pressures they face. This study investigates the effects of technological innovation (lnTI), renewable energy consumption (lnREC), natural resource rents (lnNRR), economic growth (lnGDP), and trade openness (lnTO) on environmental sustainability in BRICS economies from 2000 to 2024. The study employs an integrated econometric framework incorporating slope heterogeneity, CSD, second-generation unit root, and Westerlund cointegration tests, followed by the Method of Moments Quantile Regression (MMQR) to capture heterogeneous effects across the conditional distribution of Load Capacity Factor (LCF). The findings reveal that technological innovation significantly reduces LCF at lower and middle quantiles but is not significant at higher quantiles, signifying that technological progress does not uniformly increase environmental sustainability. In contrast, lnREC, lnNRR, and lnGDP positively and significantly enhance LCF across all quantiles. lnTO consistently hurts LCF, supporting the pollution haven hypothesis. The results remain robust when estimated using FGLS. These findings underscore the importance of accelerating the adoption of renewable energy, leading technological innovation toward environmentally efficient applications, enhancing the management of natural resource revenues, and encouraging environmentally reliable trade policies. Overall, the study highlights the need for differentiated policy strategies that reflect the heterogeneous environmental conditions of BRICS economies.