Enhancing Environmental Quality: Investigating the Impact of Hydropower Energy Consumption on CO2 Emissions in Indonesia


  • Putri Maulidar Department of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia
  • Sintia Fadila Electrical and Instrumentation, PT. Solusi Bangun Andalas, Aceh Besar 23363, Indonesia
  • Iffah Hafizah The Bartlett School of Environment, Energy and Resources, University College London, London WC1E 6BT, United Kingdom
  • Naswatun Zikra Department of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia
  • Ghalieb Mutig Idroes Energy and Green Economics Unit, Graha Primera Saintifika, Aceh Besar 23371, Indonesia; Renewable Energy and Sustainable Economics, Konstanta Utama, Aceh Besar 23371, Indonesia




Global warming, Environmental sustainability, CO2 emissions, Hydropower energy consumption, Economic growth, ARDL, Granger causality


Achieving sustainable environmental quality has become a critical global issue, necessitating the reduction of carbon dioxide (CO2) emissions and greenhouse gas (GHG) emissions to mitigate environmental pollution. Hydropower energy has the potential to play a significant role in this effort by providing a clean, renewable energy source that can help reduce reliance on fossil fuels and decrease CO2 emissions. This study examines the dynamic impact of hydropower energy consumption, economic growth, capital, and labor on Indonesia's CO2 emissions from 1990 to 2020. Applying the Autoregressive Distributed Lag (ARDL) method, the findings demonstrate that hydropower energy consumption has a negative effect on CO2 emissions in both the short and long term, indicating that increasing hydropower energy consumption leads to a reduction in CO2 emissions. Conversely, labor exhibits a positive influence on CO2 emissions in both the short and long term, suggesting that a rise in labor contributes to higher levels of CO2 emissions in Indonesia. Furthermore, the Granger causality analysis reveals a bidirectional relationship between CO2 emissions and hydropower energy consumption. The robustness of ARDL results is confirmed through additional tests using Fully-Modified Ordinary Least Squares (FMOLS), Dynamic Ordinary Least Squares (DOLS), and Canonical Cointegrating Regressions (CCR) methods. The findings underscore the importance of promoting sustainable hydropower energy for effective environmental management in Indonesia. Policymakers should prioritize investments in sustainable hydropower infrastructure, encourage the adoption of energy-efficient technologies, and develop a skilled workforce to mitigate the environmental impact of increased labor force participation.


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How to Cite

Maulidar, P., Fadila, S., Hafizah, I., Zikra, N. and Idroes, G. M. (2024) “Enhancing Environmental Quality: Investigating the Impact of Hydropower Energy Consumption on CO2 Emissions in Indonesia”, Ekonomikalia Journal of Economics, 2(1), pp. 53–65. doi: 10.60084/eje.v2i1.180.