Determinants of renewable energy development in the EU countries. A 20-year perspective

The objective of the paper is to identify factors which determine energy policy in the EU countries in the middle of 1990s. This objective is achieved in three stages. First, the changes in the distribution of RES in 26 EU countries in the period between 1995 and 2014 are investigated. The analysis demonstrates that over the last 20 years the EU countries diversify the RES they use, which results in substantial changes in their distribution. Second, the distribution of energy sources in 1995 is described, as it is assumed that the distribution might be a crucial factor influencing energy policy in each country. Third, several other factors related to energy security, environmental concerns, economy and politics are considered as potential determinants of renewable energy development. Two statistical methods of variable selection, namely, the best subset regression and the LARS method, reveal that the present (in 2014) share of RES in the energy mix significantly depends on the condition of the EU countries in the middle of 1990s. The distribution of energy sources in 1995 is the crucial determinant of renewable energy development. Countries without their own fossil fuel sources are the ones which develop renewable energy to the greatest extent. Other important factors boosting RE development include: GDP per capita, concentration of energy supply (SWI), and the costs of consumption of energy obtained from fossil fuels in relation to GDP.