Do the United States’fscal decentralization, money supply, and environmental policies promote the clean energy transition?

Following the “Glasgow Climate Change Conference (COP26)” in 2021, policymakers pay more light on the role of cleaner fuels in curbing environmental destruction. Despite being the second-largest user of renewable energy, the United States (USA) has not given much attention to the factors that determine “renewable energy consumption (RENC)”. In this milieu, this study considers some unique determinants such as “monetary policy, fscal decentralization, eco-innovation, economic growth, CO2e, the environmental policy stringency index, and economic policy uncertainty” to explore RENC. The current study uses wavelet coherence, as well as partial and multiple wavelet coherence techniques, with quarterly data extending from 1990Q1 to 2020Q4. The wavelet coherence fndings show a signifcant long-and medium-term in-phase connection between RENC, fscal decentralization, and economic growth, whereas money supply shows a signifcant in-phase connection in the medium-term frequency. Besides, increased carbon emissions, environmental policy stringency, and eco-innovation lead to higher RENC in the short-medium term. The analysis of partial and multiple are somewhat like the fndings of wavelet coherence in diferent frequency and time domains. These results have signifcant policy ramifcations for promoting RENC and achieving the “UN Sustainable Development Goals (UNSDGs) 7 (afordable clean energy)”. From a policy lens, the USA should decentralize its fscal policy at the state level, allocating more funds to clean technology research and development. Additionally, sufcient fnancial resources for increasing investment in the renewable energy industry and stricter environmental regulations may increase the usage of clean energy.