The geopolitical risk effect on the US renewable energy deployment

Our paper focuses on whether the geopolitical risk can generate a cleaner production and sustainable environment or not. It empirically investigates the geopolitical risk influence on the United States’ renewable energy deployment. The United States’ economy is the largest globally, and its economic, political, and military interests spread all over the contents. Thus, it could be the most frequent nation influenced by the world's geopolitical uncertainty. Our paper postulates that geopolitical risk stimulates countries to be independent and rely on renewable energy sources to reduce fossil fuel inflows’ risk. We use a cointegration analysis and estimate an autoregressive distributed lag model using quarterly data (1973: q1-2020: q1). We find that geopolitical risk has a significant and positive effect on the United States renewable energy deployment. Hence, it is a driver, not a barrier to renewable energy diffusion. On the policy implication side, we expect to notice more deviations toward renewable energy technology by the United States and the other nations within the high probability of geopolitical uncertainty. Thus, geopolitical risk is expecting to enhance cleaner production and a sustainable environment.