The Effect of Hydroelectricity Consumption on Environmental Degradation–
The Case of South America region

Matheus Koengkan , Luciano Losekann, José Alberto Fuinhas, e António Cardoso Marques


This article analyses the impact of hydroelectricity consumption on environmental degradation (CO2 emissions) in seven South American countries, in a period from 1966 to 2015. The Unrestricted Error Correction Model (UECM) form of the Auto-regressive Distributive Lag (ARDL) was utilized. The initial tests prove the presence of heteroskedasticity, cross-sectional independence, and first-order autocorrelation. The results show that the consumption of hydroelectricity causes a reduction of -0.0465 in environmental degradation in the short-run, and increase 0.0593 in the long-run. This empirical evidence could encourage the creation of new policies, which introduce new energy technologies that release zero carbon in the energy matrix.

Palavras-chaves: Energy economics; Economic growth; Environmental degradation; Renewable
energy; South America.