Climate governance credibility and renewable energy transition in G20 nations: an institutional signalling perspective on NDC compliance and implementation gaps (2016–2024)

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Original abstract

Introduction A core credibility problem exists in global climate governance: G20 nations collectively account for approximately 77% of greenhouse gas emissions, yet systematically diverge between their publicly signalled commitments and actual implementation under the Paris Agreement framework. This study examines NDC implementation gaps from an institutional signalling perspective, treating Nationally Determined Contributions as credibility-bearing commitments whose realisation depends on the institutional conditions that translate political signals into policy outputs. Methods Based on balanced panel data from 19 G20 economies covering 2016–2024, we construct a NDC Compliance Composite Index (NDCCI) and apply a two-way fixed effects model incorporating an interaction term between governance quality and renewable energy transition speed. Results The G20 group mean NDCCI declined continuously from 68.5 in 2016 to 55.3 in 2024, a cumulative decline of approximately 13 percentage points. The panel mean over the full sample period (2016–2024) stands at 76.4, reflecting sustained compliance levels below the full-compliance benchmark. Seven of 19 countries remain in persistent severe off-track status. A one-standard-deviation improvement in governance quality is associated with an average NDCCI level approximately 8 percentage points higher after conditioning on country and year fixed effects, an estimate that is interpreted as a robust conditional association rather than as a point-identified causal effect. The positive effect of renewable energy transition speed on NDC compliance exhibits a significant governance capacity threshold: in countries with a WGI composite index below −0.4, expansion of renewable energy installed capacity yields virtually no improvement in compliance rates. Fossil fuel subsidies represent the most important systemic barrier to implementation (β ≈ −4.5, p < 0.01). Conclusion These findings carry direct policy implications for the new round of NDC submissions in 2025, particularly regarding the need to align governance capacity building with renewable energy investment strategies and to prioritize fossil fuel subsidy reform as a prerequisite for closing implementation gaps.

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