Geopolitical Turmoil and G7 Renewable Electricity Production: Impacts of the Russian-Ukrainian Conflict

Abstract

This paper scrutinizes the transformation in the electricity production structures of G7 nations in the wake of the Russian invasion of Ukraine. The inquiry centers on discerning shifts in the trajectory of energy production, particularly toward more sustainable and secure sources. With the imposition of economic sanctions against the Russian economy, an anticipatory transition from combustible fuels to renewable energy sources within G7 countries is envisaged. An empirical investigation is conducted utilizing panel data analysis of energy data across the G7. First and second-generation unit root tests have been used. Cointegration tests and the Vector Error Correction Model have been applied to see short-term and long-term relationships between renewable energy-sourced electricity production and combustible energy-sourced electricity production. Additionally, predictive modeling, employing SARIMA and Machine Learning model (Prophet) with Python, is employed to forecast future trends in energy production. This comprehensive analysis sheds light on the profound impact of geopolitical events on the energy landscape of influential global economies. The results of the econometrics and predictive models show that there is a significant effect of Russia-Ukrainian conflicts on electricity production in favor of more secure and clean energy. This trend change in renewable energy-sourced electricity production should fortify more regulatory aspects.