Sectoral Analysis of the Causal Relationship Between Renewable and Non-Renewable Energy Consumption and Real Output in the US

Abstract This study examines the causal relationship between renewable and non-renewable energy consumption by sector and real Gross Domestic Product (GDP) in the US using annual data from 1949 to 2006. The Toda-Yamamoto long-run causality tests reveal the absence of Granger-causality between commercial and industrial renewable energy consumption and real GDP, respectively. Bidirectional Granger-causality exists between commercial and residential non-renewable energy consumption and real GDP, respectively. Finally, the results indicate unidirectional causality from residential renewable energy consumption and industrial non-renewable energy consumption, respectively to and real GDP.