Formulating sustainable development policy for a developed nation: exploring the role of renewable energy, natural gas efficiency and oil efficiency towards decarbonization

Limiting CO2 emissions is crucial for sustainable development, environmental protection, and climate change mitigation, ensuring a more resilient and cleaner future. Prioritizing sustainable urbanization renewable energy, and energy efficiency is vital for achieving this prosperous and sustainable future. As a result, we adopt the Fourier testing approach for stationary, cointegration, estimator, and causality, to scrutinize the role of renewable energy, energy efficiency, and urbanization on CO2 emissions in Finland over the period between 1990 and 2020, controlling economic growth and trade openness. The empirical analysis of the Fourier ARDL estimator establishes that energy efficiency measures such as gas and oil efficiency exhibit an adverse effect on CO2 emissions, so energy efficiency mitigates CO2 emissions. Similarly, the study also found that urbanization and renewable energy reduce CO2 emissions. Conversely, economic growth and trade openness induce CO2 emissions. Additionally, the Fourier-Toda-Yamamoto method provides robust evidence regarding the long-term implications of the examined factors. Based on this result, the study emphasizes that implementing a regulatory framework to enhance energy efficiency, promote renewable energy adoption, and support sustainable urban development will be an essential strategy in the global effort to attain the net-zero emissions target, which offers valuable insights to other countries seeking to transition towards cleaner and more sustainable energy sources.