The impact of natural disaster on energy consumption: International evidence

Highlights: • Natural disasters exhibit a negative impact on oil, renewable, and nuclear consumptions. • This negative impact clearly appears in low-income countries or in Africa region. • Different natural disasters and energy sources affect the disaster-energy consumption nexus. • Provide policy implications for governments, policy-makers, and researchers. This research shows that natural disasters may hurt energy consumption by using data on 123 countries over the period 1990–2015 and classifying them according to their economic development level and region based on World Development Indicators. We employ a two-step system-GMM method to examine the effect of natural disasters on energy consumption, presenting findings that support our hypotheses in the models and show a strong negative effect for low-income countries or those in the Africa region. After considering an alternative proxy for natural disaster, we implement quantile regression methods. Their results find that natural disasters exhibit a negative and significant impact on oil, renewable, and nuclear energy consumptions. The quantile regression models used in the robustness check present that the effects are stronger for low-level energy consumption economies.