The Impact of Biodiesel Consumption by Transport on Economic Growth in the European Union

Abstract

The EU today is the main biodiesel producer in the entire world. Many countries are promoting biodiesel production for various reasons: for satisfying their own internal growing need for energy, to ensure fuels’ availability for the transport sector, thus lowering the dependence on fossil fuels, for more efficient combating of climate changes. The actual strategies of sustainable development have determined a very fast increase in biodiesel consumption within the EU, especially since 2005. In this context, using the available data, we assessed the effects of biodiesel consumption by transport on economic growth in the EU over the period 2010-2016. The results based on the panel data approach indicate a positive, but very low impact of energy obtained from biodiesel consumption by transport on the EU’s economic growth. There is only a unidirectional causality relationship between these two variables: the biodiesel consumption Granger caused the EU economic growth from 2010 to 2016. Policy recommendations should focus on the extension of biodiesel consumption for transport within the EU by establishing a higher minim percentage of biodiesel in transport.

DOI: http://dx.doi.org/10.5755/j01.ee.30.1.21831