To read this content please select one of the options below:

External energy security elements and the riskiness of clean energy stocks: a volatility analysis

Aminu Hassan (Department of Accounting, Federal University Dutsin-Ma, Dutsin-Ma, Nigeria)

Sustainability Accounting, Management and Policy Journal

ISSN: 2040-8021

Article publication date: 13 March 2023

Issue publication date: 5 April 2023




Clean energy stocks are exhibiting signs of increasing volatility reflecting the varied and conflicting strategies employed by nations to pursue energy security objectives. In this regard, this paper aims to examine the response of NASDAQ clean energy stock returns volatility to the influences of external energy security elements including oil price, natural gas price, coal price, carbon price and green information technology stock price.


The paper uses symmetric and asymmetric generalised autoregressive conditional heteroskedasticity models (GARCH and TGARCH, respectively), which incorporate external energy security elements as exogenous variables, to estimate volatility models for clean energy stock returns.


Although, prices of oil, coal and natural gas are negatively associated with NASDAQ clean energy returns volatility, only the effect of natural gas price is significant. While carbon price affects NASDAQ clean energy returns volatility positively, green information technology price affects the volatility negatively. These results are robust to exponential GARCH and lead-and-lag robust ordinary least-squares as alternative estimation methods.

Research limitations/implications

The study lumps the effects of all other external and internal factors, including internal energy security elements, in the autoregressive conditional heteroscedasticity (ARCH) term to predict NASDAQ clean energy returns conditional variance. GARCH method does not disentangle individual roles of the factors captured in the ARCH term in predicting volatility.

Practical implications

Results documented imply that natural gas appears a closer substitute for renewable energy sources than crude oil and coal, such that its price rise is perceived as good news in the NASDAQ clean energy financial market, while a fall is considered bad news. Furthermore, both an increase in carbon price and a decrease in green information technology stock performance are perceived as negative shocks.

Social implications

In assessing risks associated with clean energy stocks, investors and fund managers should carefully consider the effects of external energy security elements.


To the best of the author’s knowledge, the paper is the first to identify external energy security elements and examine their effects on clean energy stock volatility.



Data availability statement: Sources of data for this paper are provided in Table 2 as Web links. Data set will be available at, after an embargo period.


Hassan, A. (2023), "External energy security elements and the riskiness of clean energy stocks: a volatility analysis", Sustainability Accounting, Management and Policy Journal, Vol. 14 No. 2, pp. 396-419.



Emerald Publishing Limited

Copyright © 2023, Emerald Publishing Limited

Related articles