Thailand’s transition toward a sustainable energy system has become a central concern in both academic discourse and national policymaking, particularly as the country faces rising energy demand, dependence on imported fossil fuels, and international commitments to emissions reduction. Despite increasing attention to renewable energy (RE) and foreign direct investment (FDI), empirical evidence on how these factors interact with economic growth (EG) remains fragmented. This study addresses this gap by combining econometric analysis with energy system modeling to examine the dynamic relationships among EG, FDI, fossil fuel (FFC) use, and RE consumption in Thailand from 1990 to 2023. Using a VECM framework, the historical analysis reveals that RE consumption has not yet exerted a statistically significant influence on EG, while FDI and FFC remain dominant drivers. To complement these historical findings and assess future transitions, the study integrates LEAP and MARKAL models to simulate technology-specific energy pathways and system-wide optimization scenarios to 2050. The results show that targeted green FDI, combined with efficiency-enhancing energy system design, can substantially increase renewable penetration and reduce emissions, even though the historical contribution of renewables has been modest. The study provides evidence-based policy insights for aligning investment strategies, energy planning, and decarbonization targets, and it highlights the need for more advanced modeling approaches to capture nonlinear and structural dynamics in Thailand’s evolving energy landscape. The findings suggest that Thai policymakers should prioritize green FDI incentives, RE infrastructure investment, and grid modernization policies to accelerate the transition to a more efficient, low-carbon energy system while sustaining long-term EG.
Nguyen et al. (2026) studied this question.