Economic and Environmental Impacts of the Transition to Renewable Energy Sources and Their Effect on CO₂ Emissions and Energy Market Stability

The thesis examines how the rising share of renewable energy affects the level and volatility of daily spot electricity prices in the Czech Republic and CO₂ emissions. It uses daily data for 2023–2025 (Energostat, Carbon Monitor). Weekend zeros in EUA prices are handled via LOCF, stationarity is tested (ADF) and ARDL/UECM with Pesaran’s bounds test is estimated. Inference relies on robust standard errors (Newey–West, HC3/HC1). Price volatility is defined as the annualized 30-day standard deviation of daily returns and modeled in short-run first differences. Main results: electricity prices are cointegrated (p < 10⁻⁶) with fast error correction (ECT = −0.1788, ~18% reversion per day). In the long run, a higher RES share significantly lowers prices, while system load slightly increases the, EUA prices are not significant in levels. Short-run increases in RES have an immediate negative effect on price changes, findings are robust. For CO₂ emissions, ECT = −0.497 (~50% correction per day), long-run multipliers indicate coal generation, electricity price and EUA price raise emissions, whereas temperature lowers them. Changes in volatility are mainly driven by own lags, the RES effect is small and weakly positive with a two-day lag, load dampens volatility, and EUA price changes are not significant.