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Abstract We evaluate the potential of China's pendent carbon tax policy in CO 2 (carbon dioxide) mitigations from the perspective of interfactor/interfuel substitution. The analysis is conducted by region given that interfactor/interfuel elasticities of substitution are often discrepant among different areas. The results indicate that nearly 3% reduction in CO 2 emissions from the 2010 level can be achieved by levying a carbon tax at 50 Yuan/tonne. The inelastic demand for fuel inputs in the face of rapid processes for industrialization and urbanization limits the effectiveness of China's carbon tax to a great extent. Specifically, a total amount of more than 130 million tonnes CO 2 emissions can be reduced in the East coast and Southwest areas, and the areas of Municipalities and Northwest could also achieve CO 2 mitigation by more than 3%. In contrast, the areas of Midland and Northwest can merely cut their CO 2 emissions by 1.6% and 0.92%, respectively.

Abstract This paper applies the zero-sum gains data envelopment analysis (ZSG-DEA) model to assess the provincial CO2 emission reduction scheme of China in 2020 and then calculates optimized values for the provinces in 2030. Results from two standard optimization procedures to solve the ZSG-DEA model are compared. We also extend the current methods by improving the iterative approach and then introduce fairness to the efficiency-oriented approach for the 2030 case. We found that the choice of optimization procedures has only a minimal impact on the results, but the specification of model does matter. For 2020, a standard DEA approach shows that only 2 provinces out of 30 are efficient. According to the estimation results of the ZSG-DEA model, 12 provinces need to set higher reduction targets, whereas the other 18 provinces could have lower target values to achieve overall efficiency. These results are generally consistent across different optimization approaches. The improved approach is applied to further evaluate a number of scenarios in 2030, in which the adjustment values towards optimum can be calculated for each scenario. Furthermore, we show that the inclusion of fairness can significantly affect the adjustment targets, which is of great importance to policymakers

Abstract In this paper, we try to investigate the effects of China's Western Development Strategy (WDS), carried out since 2000, on local ecological economic performance. We first construct an eco-productivity index that incorporates economic growth, inputs saving, and emissions reduction within an integrated analysis framework. Then the eco-productivity scores of 30 administrative provinces in China's over 1996–2015 are evaluated with sequential data envelopment analysis technique. The results indicate the eco-productivity score in the east and central area (ECA) declines continuously over the whole study period, while that in the west area (WA) increases persistently since 2000 when the WDS was launched. We infer from the narrowing gap of eco-productivity scores between the two areas that China's WDS implementation has promoted local ecological economic development to a certain extent. In subsequent, this preliminary inference is further verified by conducting an empirical test.

Abstract The Chinese government has made an important effort to diversify the country’s energy mix and exploit different sources of renewable energy. Although China’s installed wind power capacity has experienced a dramatic expansion over the past five years, electricity generation from wind power has not increased as expected. This paper aims to present the current status of wind generation in China and analyze the causes of the large discrepancy between installed capacity and generation. We find that this is mainly caused by the inadequacy of the power transmission grid, the absence of economic incentives to transmission and backup generation providers, and the lack of a generation-based renewable portfolio standard.

Energy saving and emissions reduction has recalibrated China’s economic development mode to a more sustainable way. In this paper, we construct a novel total factor productivity (TFP) index using a sub-vector enhanced hyperbolic distance function, which simultaneously credits for an expansion in economic output along with contractions in energy input and undesirable output. Subsequently, this index is employed to evaluate the TFP change for 30 provincial regions in China during 2006–2015. The results indicate that China’s productivity considering energy saving and emissions reduction experiences a gradual improvement shifting from decline to increase throughout this decade, and the amelioration can mainly be attributed to the efficiency improvements from the east regions, while the contributions from technical change component will not emerge until 2013 due to insufficient energy and environmental R&D investments. Finally, some policy recommendations are also put forward on how to enhance China’s productivity.

Abstract Substituting energy with capital (SEC) in economic productions has become a common practice both for business owners and policy-makers to improve their energy and environmental efficiency. However, seldom previous studies on energy efficiency and/or environmental performance evaluation took this role into account. This paper aims to shed some light on the effects of SEC on China's aggregated energy and environmental efficiency (AEEE) within a parametric stochastic frontier analysis framework. Moreover, influencing factors of regional efficiency score are also discussed using a pooled regression model. The results indicate that SEC poses significant effects on improving China's AEEE, and this impact appears obvious regional variation that regions with lower efficiency scores hold more extensive potential to improve their AEEE by means of SEC. Furthermore, upgrading industrial structure and decreasing the proportion of coal in energy consumption make great sense to improve China's AEEE.

Low economic profit usually reduces the incentive of producers to operate their wastewater treatment technologies effectively. It is necessary to investigate the performance of environmentally friendly production technologies that reduce wastewater discharges and generate economic outputs simultaneously (EPTWs) in China over the past decade. In this paper, we apply the Malmquist-Luenberger productivity index widely used in the field of economics to evaluate the productivity change of EPTWs for 30 administrative provinces in China during 2003–2015. The pathways of the productivity change are further identified by decomposing the productivity index into two components: technological change and technical efficiency change. The results show that China’s environmental productivity index associated with wastewater reduction had undergone a downward trend, and evident spatial disparities are observed among the 30 provincial regions. Moreover, the changes of China’s environmental productivity over the whole studied period can mainly be attributed to technological progress, while the technical efficiency component has contributed little, although its annual contributing rate is in an increasing trend.

Abstract In order to effectively curb the rapidly-increasing energy consumption in manufacturing industry, China has clearly stated in Made in China 2025, to reduce energy consumption per unit of industrial added value of the manufacturing by 18% in 2020 and 34% in 2025 relative to the 2015 level. Based on the ZSG-DEA and CAT models, this paper attempts to establish an efficiency-oriented energy-consuming right trading system (ECRTS) to design the energy allocation scheme along with the energy trading scheme for China’s 18 manufacturing sectors in 2020 and 2025. We find sectors with the allocated energy-consuming right could not only reach the DEA efficiency frontier, but also upgrade their energy-consuming mix. Further, the allocation scheme considering the sectoral heterogeneity is more rational as it relieves the pressure on some sectors to conserve energy. Finally, by integrating energy offsetting mechanism into the united energy market, the energy trading mechanism designed in this work can largely simplify the transaction process and improve the after-trading efficiency for all target sectors.

Energy conservation has been a critical argument in China's development agenda for decades. China had 8 billion tons of greenhouse gas (GHG) emission in 2012 (shared 27% of total global GHG emission), which received attention from researchers at home and abroad. This paper summarizes China's major policy development pathway on energy efficiency since the 1978 open‐door policy. The major focuses of this paper are provided from the perspectives of building energy efficiency capacity and reducing long‐term energy intensity as well as accelerating China's economic transformation. According to the characteristics of economic development phases, energy efficiency policy improvement in the past 35 years could be divided into three categories: planned economic period (1978–1991), partial market economic period (1992–2002) and technology‐oriented economic transformation period (2003‐present). This paper also recommends China's future energy efficiency plan to enable a long‐term energy conservation mechanism, particularly to place a close emphasis on economic transformations. WIREs Energy Environ 2016, 5:715–730. doi: 10.1002/wene.213This article is categorized under: Energy Policy and Planning > Economics and Policy Energy Policy and Planning > Systems and Infrastructure Energy Policy and Planning > Climate and Environment