Urbanization, Energy Use, and CO₂ Emissions in Pakistan: A Time-Series Analysis

Abstract

The last decades have become the years of urbanization, increased energy usage, and increased CO2 emissions, which become the key environmental issues in Pakistan. As the population moves more and more to urban centres, there has been a significant increase in the need of energy intensive infrastructure, transport, and industrialism, which has led to a consistent increase in greenhouse gas emissions. This paper analyses the dynamic relationship between urbanization and energy consumption and CO2 emissions in Pakistan in terms of a time-series econometric model. To study the stationarity, the Augmented Dickey-Fuller (ADF) test is used and subsequently, the ARDL bounds testing method is used to estimate the long-run cointegration. Elasticities of the short-run and long-run are estimated and diagnostic tests provide reliability of the model. The results indicate that urbanization and energy use have extensive positive impacts on the long-term CO2 emission, whereas the short-term changes are explained by the changes in energy use. Long-run equilibrium is confirmed by the introduction of a high error correction term. These findings stress the importance of sustainable urban planning, clean energy transitions, and energy-saving technologies as the government of Pakistan tries to balance the economic growth and environmental sustainability.