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This study investigates the impact of remittances on renewable energy consumption (REC) using a panel of 25 top remittance-receiving countries for 1990–2018. We use a generalized two-stage least squares random effect model to estimate the impact of remittance on renewable energy use. Results showed that remittances and REC have a generally positive relationship among the studied nations. Governments may create a system to incentivize remittance-receiving households to adopt and utilize more carbon-neutral energy devices at a lower cost if they pay with remittances. This approach could lead to higher societal adoption and consumption of green energy. Remittance and renewable energy consumption in the context of developing and developed countries. [Display omitted] • The generalized two-stage least square technique is used to estimate the impact of remittances. • Remittances have a positive effect on REC in the top 25 remittance-receiving countries. • The adoption of renewable energy via remittances is higher in developing nations. • Governments may incentivize carbon-neutral energy devices for remittance-receiving households. [ABSTRACT FROM AUTHOR]

This paper examines the effect of remittance income on energy consumption and the economy between 1976 and 2019 in the four highest remittance recipient nations of South Asia. The detailed analysis explores long-run and directional relationships utilizing stationary tests, the panel cointegration test, dynamic ordinary least square (DOLS), fully modified ordinary least square (FMOLS), and Granger causality tests using a Vector Error Correction Model (VECM). The study reveals the presence of long-run relationships among remittances, energy consumption, GDP and urbanization. Cointegrating regression identifies that remittance income, economic growth and urbanization individually have a positive and significant effect on energy consumption in the long-run. Results showed that a 1% increase in remittance income results in a 0.045% increase in energy consumption. Among nations analyzed, this effect was found to be strongly dominant in case of Bangladesh and Pakistan. The statistically significant and negative coefficient of the error correction term confirms long-run causality from remittance, GDP, and urbanization toward energy consumption. Variance decomposition analysis demonstrated that energy usage is heavily impacted by remittance inflows among studied variables. Policy implications of this study suggest that higher remittance inflows will increase energy consumption in South Asian countries, engendering positive economic growth and sustainable development. Image 1 • The effects of remittance on energy consumption studied for South Asian countries. • Novel statistical approaches applied to explore the causality and direction between remittance income and energy use. • Remittance income provides a potential stimulus toward national investments and ensures reliable and clean energy sources. • It is evidence that 1% raise in remittance income results in a 0.045% increase in energy consumption in the long run. • Policy makers can formulate strategic plans for migrant workers to ensure affordable clean energy. [ABSTRACT FROM AUTHOR]