How the European Union’s renewable energy directives impact the global energy industry : evidence from global stock markets
Year: 2019
Type: dissertation
Abstract: This thesis investigates the impact of renewable energy regulations imposed by the European\nUnion on the energy industry. By employing an event study methodology on three directives\ndating from 2007 to 2018; The Renewable Energy Directive (2009/28/EC), The Indirect Land\nUsage Change Directive (2015/1513) and the Renewable Energy Directive II (2018/2001/EU);\non a sample of 75 firms, consisting of 30 fossil fuel and 45 renewable energy firms from the\nregions Europe, North America and Asia-Pacific. An abnormal return is estimated for each\ncompany at the time of introduction of the three different directives. The results show\nsignificant positive abnormal returns for the energy industry with the introduction of the\nRenewable Energy Directive.\nFurthermore, the results show a significant difference between the fossil fuel segment and the\nrenewable energy segment, with positive returns for renewable energy firms, while fossil fuel\nfirms show weak adverse effects. There is no significant impact from the Indirect Land Usage\nChange Directive, as well as the Renewable Energy Directive II. Finally, there is weak\nevidence for a difference between regions with the introduction of the Renewable Energy\nDirective. However, when controlling for additional variables under the regression analysis,\nthe significant effect disappears. This suggests that the regions react similarly to the\nintroduction of renewable energy directives proposed and passed by the European Union.
Authors: Jonathan Soelberg Bierach, Eirik Hoel
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W3009046740