The focus of this paper is to investigate whether carbon footprints are reduced due to renewable energy use in fuelling the business and commercial interests of the nation’s right from trade, production, consumption in the presence of foreign direct investment (FDI). The quantification of the relationship is carried out for three developed nations and five developing nations. Error Correction Model (ECM) using Autoregressive distributed lag (ARDL) methodology is used to assess short-term and long-term country-wise parameters for the chosen variables in sample countries from 1990 to 2017. The findings demonstrate the persuasive evidence that green energy use is the sustainable path of development. The cointegrated relationship amongst the variables for the long run is validated for all eight individual countries included in the study. High-economic growth and non-renewable energy use are recognized as the major sources of environmental degradation across the country analysis. However, the panel data series of eight countries did not support the analysis in the ARDL framework, hence the Random effect model and Granger Causality technique is used to quantify the magnitude and direction of association that exists between carbon emissions, renewable energy in the presence of other macroeconomic variables including square of GDP per capita (included to test EKC behaviour) respectively. In the presence of renewable energy resource as an influencer of carbon emissions, the overemphasized EKC hypothesis, however, is not supported in the panel data analysis and in country wise analysis.