The Impact of Financial Development and Economic Growth on Renewable Energy Supply in South Africa

Reviewer 1

The abstract generally presents the subject of the research and outlines the findings. The aim of the article is defined and the methodology is indicated. However, the research gap that constitutes the novelty of the article is not articulated.

The research gap has been added to the abstract.

The introductory section presents the background of the research and also the context of the adopted research. It is worthwhile to add a few sentences about global needs and trends of activities in this field to move from global experience to local experience. It is also worth referring to world energy prices as a reference to the theorem in line 35. The article touches on financial issues, so it is worth paying special attention to these aspects throughout the study (how expensive? how much cheaper?).  In the introduction, it is also worth presenting the steps of the research undertaken in the article.

• The global context is provided in the introduction.
• Global prices for clean energy VS fossil fuels are provided in the introduction.
• Modelling steps are provided in the introduction.

The literature review was grouped thematically. It started with a gap definition and reviewed the research. The review is interesting and valuable. It is worth strengthening the global literature on the content presented in the introduction (according to the comments on this section). In this respect, it is worth studying, among other sources: https://doi.org/10.3390/en16155766 .

Key themes in research related to the determinants of green energy adoption are reviewed and a thematic evolution flow-chart is provided as part of the literature review section.

Point 3 Research methodology developed in a very interesting way, with strong literature support. What is somewhat lacking is the visualisation of the research steps (leyout) and their coupling with the methodology adopted and discussed.

Figure with modelling steps provided as part of the methodology section.

Point 4 - results. An introduction to the presentation of the results (to enrich the text) is worthwhile. Between the tables, (456 - 457 and others) the text should be completed.

An introduction to the results has been added to the article.

The texts between the referenced tables have been completed.

Conclusion - Consider moving part of the paper from this point to the missing "discussion" section. Care should then be taken to clearly separate the contributions of the literature to date from the authors' findings and to guide the discussion format. Implications should be reinforced.

The study has been restructured to reflect the results of the study, a Discussion section that links the study’s results to the literature and a conclusion section that is separated from the literature.

Implications have been included in section 5. Discussion

The Conclusion point should be directly related to the purpose of the paper as stated in the introductory section. The article's contribution to responding to the research gap should be more strongly emphasised to highlight its novelty. From the concluding section, the literature reference should no longer appear.

The study has been restructured to reflect the results of the study, a Discussion section that links the study’s results to the literature and a conclusion section that is separated from the literature.

We have updated the conclusion to tie back to the aim of the study and how it has been achieved.

The article has been updated to respond to the research gap and therefore indicating its contribution to previous research.

Reviewer comment

Author’s response

Reviewer 2

The selection of variables is explained and correct. The model was carefully designed and used. However, at the end, the authors should mention the possibilities of replicating the research.

The article has been updated to include the following paragraph in the methodology section:

The variables used in the study were standard and publicly available variables that are accessible for multiple countries and from various data sources. The model used for the study is a standard ARDL model. Therefore, if similar variables for other countries are employed with an ARDL model, this study can be replicated for those countries.

5.      Are the conclusions consistent with the evidence and arguments presented
and do they address the main question posed?

Only partially. The section on applications should be reworded. It should contain:

- research conclusions regarding relationships and impact;

- in-depth recommendations for South Africa,

- originality of research;

- limitations and directions for further research (this part is improved and sufficient).

The conclusion is updated to contain the conclusion on the impact of financial development and economic growth on renewable energy supply.

The study is updated to provide recommendations to NERSA and the South African regulatory body responsible for energy sector policies.

The originality of the study has been articulated in the conclusion.

Limitations and directions for future research are part of the conclusion section.

However, the conclusions should not include any discussion of previous research results. This material should be a separate DISCUSSION section. Then it is also possible to demonstrate that the gap has been carefully filled and that the text has a scientific value. In its current form, this is a serious drawback

The study has been restructured to reflect the results of the study, a Discussion section that links the study’s results to the literature and a conclusion section that is separated from the literature.

We have updated the conclusion to tie back to the aim of the study and how it has been achieved.

The article has been updated to respond to the research gap and therefore indicating its contribution to previous research.

Reviewer 3

Reviewer comment

Author’s response

1

1. The use of bibliographic references in the text of the article is inappropriate. Citation by reference number (which actually exists in the bibliography) is not used, but in a different way, in which the name of the first author and the year of publication are taken.

Please provide clarification for this comment as we are struggling to articulate it. Could you please also provide an example of the change requested?

2

2. The way the article is organized must be improved. Section/subsection notations with 4 digits are used improperly, which makes it difficult to follow the structure of the article. Also, there are sections (such as 3.1.2.2 - 3.1.2.6) consisting of a single paragraph, with 3-4 lines of 2 sentences each.

The section has been restructured and 4 digit notations have been removed.

3

3. The notation of the tables in the article is also completely incorrect. For instance, there is a table marked as Table 4. 5.1.1.

The table numbering has been corrected.

4

4. The figures are also notated incorrectly. There is in the article, for example, Figure 4.5.5.1.

The figure numbering has been corrected.

5

5. The notations used in the equations in the article are inconsistent. Thus, in equation (1), the notation ∆y represents the first difference operator, and in equation (2) the same notation ∆y represents the change in the number of lagged terms.

Please note that the equations are from two different sources and are modelled differently by each source, hence the notations will not be the same.

6

6. Not all the notations used in the equations are explained. Thus, for equation (1) it is not specified who p and y are, and for equation (2) it is not specified who αi and m are. For equation (3) notations α1-α6 and Dt−1 are not presented.

Generic equations i.e., the Phillips-Perron test and the Augmented Dickey-Fuller model are removed. The missing notations for the empirical ARDL model are added.

Reviewer 4

Reviewer comment

Author’s response

1

The novelty and scientific contribution should be expanded in terms of the methods and data applied.

Have these methods or data applied in similar studies in the past? How does these studies compare with the results obtained from this study?

The article has been updated to reflect previous studies that have applied similar data for all the variables, except for the variables that have not been previously explored by other researchers (these include Loadshedding, coal electricity supply and coal price changes).

The article also expands on the choice of the econometric model (ARDL) by indicating previous similar studies that have employed this model.

The link between the results of previous studies and this study is discussed in section 5. Discussion

2

Indicating the hypothesis and research questions of your study would be very important.

The research question is provided added under as part of the introduction and the hypotheses are added as part of the methodology section.

3

Afterwards, in the results sections the results should indicate how they are able to prove the hypothesis (or disproved) and how the research questions are answered. Indicating the impact on organizations and practitioners for the proposed methods and data would be relevant.

The hypothesis testing process is explained before the significance of each beta coefficient is considered.

The implications of the results are added to the discussion section.

4

The abstract should be improved to include the novelty and scientific contribution of the study. Afterwards it should be indicated how the results proved the hypothesis and contributed to the existing body of knowledge.

Research gaps and scientific contributions were added to the abstract and the results were discussed. 

5

The literature review should include a table and a flow chart to clarify the evolution of the topic, and the previous application of the proposed methods.

Key themes in research related to the determinants of green energy adoption are reviewed and a thematic evolution flow-chart is provided as part of the literature review section.

6

The method section should include a flow chart to indicate the connection and sequence of the applied methods.

Figure with modelling steps provided as part of the methodology section.

7

It would be relevant to indicate how this data and results have been applied in previous studies and how it compares with their application for this research.

A discussion in section 3. Research methodology and section 5. Discussion addressed this review comment.

8

The data description should be expanded, indicating the frequency and granularity of the data. Are all the data sources applied on the same periodicity (daily, weekly, etc) or have diverse frequency? If they have diverse frequency how was the data normalized to be applied in this study for the results to be generated.

The study used annual time series data from 1990 to 2021 for all the variables reported in the econometric model. This has been mentioned in section 3.1 Data description

9

The results for the study reports that financial development and economic growth have a positive impact on renewable energy supply in the long-run and short-run. This is a very relevant finding. It would be important to highlight previous studies that support this finding in the abstract, introduction, results, and conclusion. Indicating studies that have found similar impacts for other countries that have similar characteristics would be important.

Indicating why financial development and economic growth are the variables that have main effect on the development of renewable energy (over other potential variables such as regulatory changes or technology development) would help strengthen the novelty and scientific contribution of the study.

The link between the current study and previous studies has been done in section 5. Discussion as other reviewers have asked that the results and conclusion should be separated from previous studies, hence the new section included being 5. Discussion to discuss the link.

A statement has been included in the article in section 5. Discussion indicating the following:

Financial development and economic growth are variables identified to have the main impact on renewable energy supply as the aim of the study is to examine these particular variables. The main reason for the inclusion of other explanatory variables in the model of this study was to increase the robustness of the model and to contribute to the reported Adjusted R squared.

10

In the conclusion it would be important to address the uncertainty levels generated by the data, methods and of the results.

Indicating future research and potential applications of the research would be important to highlight its scientific contribution.  

The confidence level used in this study was added to the conclusion to indicate uncertainty levels.

Future research has been included in the conclusion section. We further included a discussion on how the relevant stakeholders can use this study to improve renewable

energy supply based on the findings of the study.

11

Extensive editing of English language required.

The document is edited as recommended.

Reviewer comment

Correction made

I continue to recommend that the literature review should include a table and a flow chart to clarify the evolution of the topic, the previous application of the proposed methods.

I included a figure that shows the thematic evolution of this research field in the literature review section.

I included a table depicting related articles that employed the ARDL model.

I believe that the flow chart in the methods section should be improved to indicate in further detail the connection and sequence of the applied methods.

The flow chart in the methodology section is improved by adding more detail.

The citations indicated in the text don’t have uniform format. Some of them don’t have the year and others have the information in different order. I would recommend to review this.

Reviewed and corrected.

I recommend to perform additional editions on the manuscript to improve English grammar and it narrative.

The article was edited by a professional editor and the confirmation letter attached.