Digitalization-Driven Clean Energy Transition and Emission Reduction in ASEAN

Abstract

This study inspects how digitalization, clean energy and economic growth influence the carbon emission in selected ASEAN states. The study is based on balanced panel data from 2000 to 2025. The panel unit root tests and the Pooled Mean Group (PMG) technique are employed to ascertain the short run dynamics and long run associations. Digitalization has substantially decreased carbon emissions by enabling safer production processes and improving energy efficiency according to the long-term outcomes. Renewable energy consumption and reduced energy intensity further contribute to emission mitigation, while economic expansion raises emissions due to scale effects. The short-run outcomes indicate that renewable energy and energy efficiency have an immediate impact of reducing emissions. Moreover, digitalization has a transient effect of increasing emissions at the same time because it will cause more electricity consumption during the initial years of adoption. Long-run cointegration and convergence is confirmed by negative and significant error correction term. Incorporating GDP squared confirms an inverted U-shaped environmental kuznet curve, signifying emission reductions beyond a given level of income. Generally, the outcomes highlight the role of digital transformation and clean energy in the attainment of sustainable growth, which is aligned with SDG 7, SDG 9, and SDG 13.