Pathway and policy analysis to China’s deep decarbonization

The Paris Agreement marks the beginning of a new era in the global response to climate change, which further clarifies the long-term goal and underlines the urgency addressing climate change. For China, promoting the decoupling between economic growth and carbon emissions as soon as possible is not only the core task of achieving the medium- and long-term goals and strategies to address climate change, but also the inevitable requirement for ensuring the sustainable development of economy and society. Based on the analysis of the historical trends of the economy and social development, as well as society, energy consumption, and key end-use sectors in China, this paper studies the deep carbon emission reduction potential of carbon emission of in energy, industry, building, and transportation and other sectors with “bottom-up” modeling analysis and proposes a medium- and long-term deep decarbonization pathway based on key technologies’ mitigation potentials for China. It is found that under deep decarbonization pathway, China will successfully realize the goals set in China’s Intended Nationally Determined Contributions of achieving carbon emissions peak around 2030 and lowering carbon dioxide emissions per unit of gross domestic product (GDP) by 60–65% from the 2005 level. From 2030 onward, the development of nonfossil energy will further accelerates, and the share of nonfossil energies in primary energy will amounts to about 44% by 2050. Combined with the acceleration of low-carbon transformation in end-use sectors including industry, building, and transportation, the carbon dioxide emissions in 2050 will fall to the level before 2005, and the carbon dioxide emissions per unit of GDP will decreases by more than 90% from the 2005 level. To ensure the realization of the deep decarbonization pathway, this paper puts forward policy recommendations from four perspectives, including intensifying the total carbon dioxide emissions cap and strengthening the related institutional systems and regulations, improving the incentive policies for industrial low-carbon development, enhancing the role of the market mechanism, and advocating low-carbon life and consumption patterns.     

Empirical analysis of carbon tariff’s effect on the export structure of China’s manufacturing industry and social welfare based on the GTAP model

In recent years, carbon emissions have gradually evolved from an environment issue into a political and economic one. Carbon tariff has brought about new trade barriers of developed countries, and in order to enhance the industrial competitiveness of developed countries, it will produce unfavorable impact on developing countries. Concentrated on the manufacturing industry, which is the most intensive high-carbon industry in China’s export structure, this article studies the relationship between carbon tariff policy and industry structure of export trade and builds up a relation between climate change and international trade. First, by means of establishing a partial equilibrium model, it applies geometric analysis and mathematical analysis to compute the impact on China’s manufacturing export trade and the consequences of the introduction of the US carbon tariff to China’s manufacturing industry that has already imposed a domestic shipping carbon tax. Furthermore, with the application of the GTAP model, it estimates the overall economic and welfare effects on China’s manufacturing industry if the US and Europe introduce carbon tariff by means of four ways, and then analyzes the influence on China’s manufacturing industry export structure and social welfare as well. The result shows that the introduction of the US carbon import tariff lowers China’s export price and export volume, and the implementation of a domestic carbon tax justifies a higher export price and a lower export volume for China. However, the degree of export reduction is smaller than that under the effect of the US carbon tariff. In the case of developed countries imposing carbon tariff on China’s energy-intensive industries, such as chemical rubber products, oil and coal-processing industry and paper industry, whose export would be reduced, the negative impact on the paper industry is the severest, which will decrease the paper industry’s export ranging from 1.79% to 6.05%, whereas the other industries’ export will increase. Anyhow, it will promote China’s manufacturing industry to adjust the export structure to a certain extent. In addition, it will lead to a decrease in China’s welfare, with a decrease between $2.134 billion and $8.347 billion. Finally, this paper provides information on international coordination, export structure adjustment and green manufacturing adjustment as a reference for the development of China’s manufacturing industry.     

Evaluation on the development degree of China’s seven pilot carbon markets

China is preparing to establish a nationwide carbon market in 2017, and in order to facilitate this goal, seven pilot carbon markets have been under study for the past few years. This paper summarizes the operation experience and challenges of the seven pilot carbon markets in China. It has been widely accepted that the essence of a carbon market is to solve environmental problems through market mechanisms, with environmental benefit being the fundamental purpose, market mechanism being the key measure, and policies and regulations being an important guarantee for an orderly carbon market. Therefore, this paper constructs an evaluation index system composed of 34 detailed sub-indexes in three dimensions, such as environmental constraint force, market resource allocation ability, and supporting policies and facility completeness. Through analyzing the operation data from 2013 to 2016, the weights of the sub-indexes are obtained. In addition, the study obtains experts’ opinions from over 10 carbon permits exchanges, consultancy firms and research institutions in China, and conducts a comprehensive evaluation on the development degree of the seven pilot carbon markets. Results show that the pilot carbon markets that include private SMEs as the covered entities for emissions control present relatively higher environmental constraint force. But too many covered entities could increase the difficulty of market performance management, while the pilots that include high energy-consuming state-owned enterprises as the entities for emissions control demonstrate a phenomenon of “high market compliance rate with low trading volume”. The resource allocation capability of China’s carbon market has not been effectively brought into play, and low degree of market participation has become an important constraint factor for market development. Due to the lack of laws and regulations at the national macro-level, the legally binding force of the pilot markets construction is obviously insufficient, and the supporting policies are lacking foresights. Generally, the development of China’s pilot carbon markets is still in such a fragmented state as in the aspects of environment, market and policy development, and the market operation has not yet achieved the purpose of solving environmental problems through market mechanisms. Accordingly, policy recommendations pointed out by this study are that tightening the allowance of free quota and progressively increasing the auction proportion, improving legal construction, increasing the services and products of carbon finance and standardizing the order of market transactions, enhancing capacity building of local governments and promoting the participation willingness and capability of emissions control entities, will be necessary.     

A review of research on China’s carbon emission peak and its forcing mechanism

In order to make further steps in dealing with climate change, China proposed to peak carbon dioxide emissions by about 2030 and to make best efforts for the peaking early. The carbon emission peak target (CEPT) must result in a forcing mechanism on China’s economic transition. This paper, by following the logical order from “research on carbon emission history” to “carbon emission trend prediction,” from “research on paths of realizing peak” to “peak restraint research,” provides a general review of current status and development trend of researches on China’s carbon emission and its peak value. Furthermore, this paper also reviews the basic theories and specific cases of the forcing mechanism. Based on the existing achievements and development trends in this field, the following research directions that can be further expanded are put forward. First, from the perspective of long-term strategy of sustainable development, we should analyze and construct the forcing mechanism of CEPT in a reverse thinking way. Second, economic transition paths under the forcing mechanism should be systematically studied. Third, by constructing a large-scale policy evaluation model, the emission reduction performance and economic impact of a series of policy measures adopted during the transition process should be quantitatively evaluated.     

Distributional dynamic and trend evolution of China’s agricultural carbon emissions – an analysis on panel data of 31 provinces from 2002 to 2011

Researching the dynamic distribution characteristics and trend evolution of agricultural carbon emissions is of considerable significance in formulating an effective agricultural carbon reduction policy. Based on measurement of agricultural carbon emissions of 31 provinces over the period 2002–2011, the study observed regional differences and the dynamic evolution of distribution of agricultural carbon emissions using agricultural carbon intensity as the indicator, accompanied by Gini coefficients and the kernel density estimation method. The results demonstrate first that agricultural carbon emissions for China show an obvious nonequilibrium nature in regard to spatial distribution. According to the differences in agricultural carbon emissions dynamic trends, we divided the 31 regions into four types – continuous decline, fluctuating decline, continuous increase, and fluctuating increase. Further, agricultural carbon emissions intensity showed a downward trend with significant differences in the research areas. Second, the gap in spatial distribution of national agricultural carbon emissions is gradually expanding based on the results calculated by Gini coefficient. From the perception of regional differences in agricultural carbon emissions, the eastern region showed an average level, the gap was more obvious in the central region, while western region showed a trend of fluctuating downward. Third, according to estimation by kernel density, the regional disparity in agricultural carbon emissions had a downward, but limited, trend. In regard to agricultural carbon emissions over the three areas, the regional gap not only tended to decrease but also showed a “four way” differentiation phenomenon in the eastern region. The difference in the central region difference was narrower. On the whole, the gap for the western region reduced steadily over a small range.     

Research on the effects of command-and-control and market-oriented policy tools on China’s energy conservation and emissions reduction innovation

The impact of environmental regulation on technology innovation is a hot spot in current research where a large number of empirical studies are based on Porter Hypothesis (PH). However, there are still controversies in academia about the establishment of “weak” and “narrow” versions of PH. Based on the panel data of application for patent of energy conservation and emission reduction (ECER) technology of Chinese city scale during 2008–2014, comprehensive energy price, pollutant emission, etc., mixed regression model and systematic generalized method of moments method were adopted, respectively, to study the impact of market-oriented and command-and-control policy tool on China’s ECER technology innovation. The results show that the environmental regulation hindered the technological innovation in the immediate phase; however, it turned out to be positive in the first-lag phase. Hence, the establishment of “weak” PH is time-bounded. The command-and-control policy tool played a more positive role in promoting technological innovation in the first-lag phase than market-oriented policy tool. Therefore, “narrow” PH is not tenable. The reason is that the main participants of China’s ECER technology innovation are state-owned companies and public institutions. Regionally speaking, the impact which command-and-control policy tool has on technological innovation at sight was non-significant in the eastern, the central, and the western regions of China whilst market-oriented policy tool had a negative effect. And market-oriented policy tool in the central region had strongest negative effect, which would diminish in the eastern region and become weakest in the western region. This was related to regional energy consumption level and the market economic vitality.     

Decoupling and decomposition analysis of carbon emissions in Beijing’s tourism traffic

Environment, Development and Sustainability - Using the calculation method of the United Nations World Tourism Organization (UNWTO), this paper measured the carbon emissions of tourism traffic and...     

China’s three north shelter forest program: cost–benefit analysis and policy implications

Environment, Development and Sustainability - Sandstorms and soil erosion are serious problems around the world, but particularly in arid northern China. In response to these problems, the Chinese...     

The role of capital deepening in China’s energy transition

ABSTRACT

This paper provides a theoretical model to explain the causality between China’s energy transition and capital deepening found by the empirical study. We prove that in the equilibrium, China’s energy transition is endogenously determined by capital deepening due to the homogeneity of electricity and the monopolistic competition features of China’s electricity market. Price effect, which is the effect of change in relative factor price, will affect energy transition only if the policy intervenes electricity price in terms of the primary sources from which it is generated. We propose that investment can promote energy transition by stimulating capital deepening which is biased to clean energy development. In this regard, our paper provides a new way of thinking for other developing countries to design an effective energy transition policy.     

Influences of Border Carbon Adjustments on China’s Foreign Trade

Abstract

The EU, the United States and other economies, with the intention to implement unilateral trade measures Border Carbon Adjustments, impose emission reduction pressure on developing countries. Once implemented, the measures will have great impact on China’s foreign trade. Using the input-output table in 2007, this paper had analyzed the influences on China’s foreign trade as a whole and sub-sectors in three tax rates scenarios. The results showed that the tariff level of China’s exports will increase by 3.6%–6.3% if the tax was levied on exports embodied emissions, and by 1.0%–1.7% if levied on export direct emissions. In 2007, the former total amount of carbon tax was about US$42.6–73.0 billion, 4 times that of the latter. Based on export embodied emissions, sectors largely influenced were non-traditional energy intensive ones, such as textile, et al. These sectors should be encouraged to carry out industrial upgrading, raising the value-added of export goods, and reducing their embodied emissions by reduction of energy intensity. Taking into account of the complexity of data collection, the tax levied on products direct emission is more operational. The results showed that the five top sectors most affected were other chemical materials, processing of petroleum and nuclear fuel, coking, smelting and rolling of ferrous metal and textile. Most of them were energy intensive sectors. Therefore, adjusting export products structure, and controlling too fast development of energy intensive industries are also important strategies in China.     

Influences of Border Carbon Adjustments on China’s Foreign Trade

The EU, the United States and other economies, with the intention to implement unilateral trade measures Border Carbon Adjustments, impose emission reduction pressure on developing countries. Once implemented, the measures will have great impact on China’s foreign trade. Using the input-output table in 2007, this paper had analyzed the influences on China’s foreign trade as a whole and sub-sectors in three tax rates scenarios. The results showed that the tariff level of China’s exports will increase by 3.6%-6.3% if the tax was levied on exports embodied emissions, and by 1.0%-1.7% if levied on export direct emissions. In 2007, the former total amount of carbon tax was about US$42.6-73.0 billion, 4 times that of the latter. Based on export embodied emissions, sectors largely influenced were non-traditional energy intensive ones, such as textile, et al. These sectors should be encour-aged to carry out industrial upgrading, raising the value-added of export goods, and reducing their embodied emissions by reduction of energy intensity. Taking into account of the complexity of data collection, the tax levied on products direct emission is more operational. The results showed that the five top sectors most affected were other chemical materials, processing of petroleum and nuclear fuel, coking, smelting and rolling of ferrous metal and textile. Most of them were energy intensive sectors. Therefore, adjusting export products structure, and controlling too fast development of energy intensive industries are also important strategies in China.     

Review of China’s policy and management system for the paid use of sea area

As a carrier to develop various marine resources, sea area is regulated as a kind of important resources through legislation by many coastal countries with a management system for the paid use of sea area. Since the early 1990s, China has begun to implement the paid use and formed an institutional system comprised of three levels after developing it for more than two decades. From 2002 to 2015, the Chinese Government transferred the use right of sea area of 33,910 km² by paid use and levied a total of 75.89 billion CNY (11.328 billion US dollars) of sea area use payment. Apart from this, the Government has gained rich experience in operating and managing the compensable use of sea area. After retrospectively analyzing the development history of paid use of China’s sea area, the research presents an institutional structure and the implementation of the management system for the paid use of sea area and the main problems therein. On this basis, management policies and feasible policy suggestions are proposed. Research results from this study can provide available references for other developing countries and emerging economies to apply and improve native management system for the paid use of sea area.     

Impact of Climate Change on Urban Agglomerations in China’s Coastal Region

Climate change and urbanization issues are the two key factors that make humans liable to be affected by disasters, which are overlapped in urban agglomeration. The five big urban agglomerations of China with strong economic power are the important engines for national economic and social development. However, being in the sea-land mutual interaction belts with a vast hazard-bearing body, they are affected by sea-land compound disasters, and are liable to suffer heavy disaster losses with climate change. It is suggested that government departments concerned should fully recognize the impact of climate change on coastal urban agglomerations, propose strategies as soon as possible, and integrate the impact of climate change and adaptation countermeasures into the various kinds of social-economic development plans for coastal urban regions.     

Discussion on the Mode of China’s Low-carbon Society and Construction Routes

In responding to global climate change,the idea of low-carbon economy emerges as the times require.Developing low-carbon economy is based on the construction of low-carbon society.The so called "two-orientation society"(resources conservation orientated society and environmental friendly orientated society) is the concrete representation of low-carbon society with Chinese characteristics,and an actual action for China in developing low-carbon economy.Based on urban agglomeration,the paper discusses the meaning of and the route to low-carbon society which would better reflect the intrinsic requirements of such a society.     

The clean development mechanism and community forests in Sub-Saharan Africa: reconsidering Kyoto’s “moral position” on biocarbon sinks in the carbon market

Negotiations of the Kyoto Protocol reached what has been called a moral position on biocarbon sinks which saw important limitations on their use in the Clean Development Mechanism (CDM), the Protocol’s main carbon offset system. After outlining this moral position, this article examines the consequences of these limitations on the viability of community forest participation in the CDM through a case study of three community forests in West Africa. Results suggest that there is significant carbon mitigation potential from forest conservation, reforestation as well as from improved fuelwood cookstoves at the community level. Yet under the current rules of the CDM, little of this overall carbon mitigation potential is able to be realized. Using qualitative research methodologies, it was learned that community respondents showed a pragmatic, yet cautious interest in the CDM while also emphasizing a need for land-use flexibility. The paper closes with a political discussion of the “‘moral position” on biocarbon sinks in the carbon market and concludes with policy recommendations for biocarbon sinks, in both the CDM and REDD, in the post-Kyoto climate change regime.     

Carbon emissions of china’s industrial sectors based on input–output analysis

This study uses an input–output model presenting the embodied carbon emission in the import–export procedure, as well as the responsibility allocation between China’s 35 sectors and 7 main trade partners from 1995 to 2011. Results indicate that the amount of carbon emissions in China’s industrial sectors is immense and that the industrial sectors are in serious imbalance. Such imbalance exists mainly in textiles, basic and fabricated metal, electrical and optical equipment, and machinery, among others. Based on the consumer-responsibility principle, the responsibility of 29 departments is reduced. Correspondingly, foreign sectors become more responsible. America, as China’s largest trading partner, should account for most of the total responsibility, followed by developed countries such as Japan, South Korea, and Germany.     

Threshold effects of tourism agglomeration on the green innovation efficiency of China’s tourism industry

ABSTRACT

Industrial agglomeration is an essential and effective way to integrate resources and elements. Its impact on the green innovation efficiency of the tourism industry is a process of continuous development and dynamic change. This paper, based on the provincial panel data from 2006 to 2015, uses super SBM model to measure the green innovation efficiency of China’s tourism industry. The threshold regression model is employed to conduct empirical tests of the nonlinear threshold effect of agglomeration on the green innovation efficiency of tourism industry. The inter-provincial differences of various threshold effects and their possible causes are analyzed. Results indicate that the green innovation efficiency of China’s tourism industry is generally growing, while regional disparity is significant with a gradient decrease along the eastern-central-western regions. There is an obvious positive nonlinear relationship between tourism agglomeration and green innovation efficiency. It is also found that with the increase of agglomeration, its influence is at a high level. As the level of agglomeration crosses the first threshold, its impact is at a low level, and when it crosses the second threshold, the impact of tourism agglomeration is at an intermediate level. Finally, this paper proposes the basic path and some policy recommendations to promote the green innovation efficiency of the tourism industry in China.     

Mixed oligopoly,foreign penetration and China’s environmental policy: a research based on mixed oligopoly model

This paper analyzes how the foreign penetration affects China’s environment policy in a mixed oligopoly framework, and gets several interesting conclusions. First, our result shows that government should strengthen the degree of environmental policy along with increasing proportion of domestic ownership of multinational firms. Second, we show that an increase in domestic ownership of multinational firms raises not only domestic private firms’ profit but also public firm’s profit as well as social welfare. Third, the government will raise the environmental tax to control environmental damage.     

An analysis of China’s investment in the hydropower sector in the Greater Mekong Sub-Region

The Mekong River’s natural resources offer large benefits to its populations, but it also attracts the interest of foreign investors. Recently, Chinese firms, banks and government bodies have increasingly invested in large hydropower projects in the Greater Mekong Sub-Region. Due to China’s rapid economic growth, its rapid industrialisation and its limited domestic natural resources, the Chinese government has issued the ‘Going Out Strategy’ which promotes investments in overseas natural resources like water and energy resources. In search for climate-friendly low-carbon energy, cheap electricity and access to a growing market, Chinese institutions turn to Southeast Asia where Chinese institutions are currently involved in more than 50 on-going large hydropower projects as contractors, investors, regulators and financiers. These Chinese institutions have influence on environmental and social practices as well as on diplomatic and trade relations in the host countries. Currently, there are major gaps in understanding who is engaged, why, how and with what impacts. This paper therefore aims to assess the motives, actors, beneficiaries and the direct and indirect impacts of China’s investment in large hydropower projects in the Greater Mekong Sub-Region. The authors use the ‘Rising Powers Framework’ to assess these issues, which is an adapted version of the Asian Drivers Framework.     

China’s Import of Wastes and Its Implications

Abstract

The trade of wastes in the world has been increasing and China has become the largest importer of wastes. This paper examines the import trend of different wastes and finds out that the total import volume to China approved by the Chinese government keeps increasing and the illegal trade can not be banned despite repeated prohibitions; therefore, China is not only “a world factory”, but actually “a global garbage dump”. In order to well understand the implications of wastes import, this paper further analyzes the resource and environmental effects and risks of different wastes imports as well as the strong driving force of wastes imports. Based on these detailed analysis and solid data, policy recommendations are put forward to reduce the demand for raw materials, to further strengthen the inspection of and supervision over the international trade of the wastes that can be used as raw materials by using the life cycle analysis and risk analysis, to improve the environmental standards and strengthen the disposal capacity, to re-export the raw materials produced from the imported wastes, to develop the long-term planning for the import of wastes and to promote international cooperation.