Does green finance promote renewable energy? Evidence from China

In the context of sustainable development, how to promote renewable energy is worthy of widespread research and discussion. Based on provincial data from 2001 to 2019, this paper offers an empirical study on renewable energy in China from the perspective of green finance. The results show that green finance directly promotes renewable energy and even indirectly promotes it by driving research and development, strengthening market openness, and boosting the economy. In addition, a high-level economy and high-level government support are important prerequisites to facilitate this impact. Compared to traditional renewable energy, green finance plays a stronger role in promoting new renewable energy. With further development of renewable energy, the marginal impact of green finance on renewable energy increases. Moreover, green finance has a positive spatial effect on renewable energy by promoting it in neighboring provinces. When looking at a region, the spillover effect of green finance is usually much larger than the direct effect.