The Impact of Energy Transition on Algeria's Financial Stability (1995-2025): An Econometric Study Using the NARDL Approach

Abstract

This study aims to analyze the impact of energy transition on financial stability in Algeria over the period (1995–2025), focusing on the role of renewable energy in shielding the general budget from the volatility of traditional resources. The study employs an econometric approach using the Non-linear Autoregressive Distributed Lag (NARDL) model to capture the asymmetric relationships between variables.
The findings reveal the existence of a long-term equilibrium and cointegration between energy transition and the fiscal balance, with a notable asymmetric effect. Specifically, the results indicate that negative shocks in energy savings (gas surplus shortages) exert a fiscal pressure far exceeding the gains generated by positive shocks. Furthermore, the results demonstrate that investment in energy alternatives, despite its short-term costs, acts as a catalyst for financial resilience in the long run. Consequently, the study recommends accelerating the integration of renewables to ensure the sustainability of the public treasury