Laima Okunevičiūtė Neverauskienė

Department of Economics Engineering,

Vilnius Gediminas Technical University, Lithuania

neverauskiene@vilniustech.lt

ORCID 0000-0002-7969-3254

How investments into renewable sources affect economic development: A case of the EU countries

Virgilijus Dirma

Institute of Business and Economics, Faculty of Public Governance and Business, Mykolas Romeris University, Lithuania 

vidirma@stud.mruni.eu

ORCID 0009-0007-4798-0092

Irena Danilevičienė

Department of Financial Engineering, Faculty of Business Management, Vilnius Gediminas Technical University,

Lithuania

irena.danileviciene@vilniustech.lt

ORCID 0000-0003-1943-4135

Laura Gudelytė-Žilinskienė

Department of Financial Engineering,

Vilnius Gediminas Technical University, Lithuania

laura.gudelyte.zilinskiene@vilniustech.lt 

ORCID 0000-0002-5942-9608

Manuela Tvaronavičienė

Department of Business Technologies and Entrepreneurship,

Vilnius Gediminas Technical University, Lithuania;

General Jonas Žemaitis Military Academy of Lithuania, Lithuania;

Daugavpils University, Latvia

manuela.tvaronaviciene@jssidoi.org

ORCID 0000-0002-9667-3730

Abstract. Energy consumption trends reflect an increasing demand for energy. Waste sorting, energy stewardship, and investing in renewable energy sources can help mitigate the consequences of climate change. Sustainability is increasingly dependent on renewable energy sources, as they help ensure long-term economic growth and social stability without dependence on fossil fuels. Scientists, politicians, and investors are interested in the development of alternative energy sources. It is assumed that greater investments in renewable energy not only help reduce environmental pollution but also stimulate innovation and economic development. This article aims to assess the impact of investments in renewable energy sources on the economy and to identify the relationships between the scale of investments and changes in economic indicators. An eclectic specification of the economic growth model, based on the neoclassical conditional beta convergence model supplemented with various economic growth factors (using panel analysis), allowed for the testing of hypotheses and sub-hypotheses raised. The results revealed that investments in renewable sources do not directly impact economic development; however, they do affect other economic indicators that play a crucial role in the economic development process.

Received: December, 2024

1st Revision: September, 2025

Accepted: December, 2025

DOI: 10.14254/2071-8330.2025/18-4/12

JEL Classification: O33, O44, Q42, Q43

Keywords: energy, economic growth, investments, renewable sources