The Power of Trading Innovation: Is Market-Oriented Trading of Distributed Power Generation Greening the Energy Industry?

Kai Zhu, Xiangran Cheng, Kangyin Dong () and Tooraj Jamasb
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Kai Zhu: Chinese Academy of International Trade and Economic Cooperation, Beijing 100710, China
Xiangran Cheng: School of Statistics, Tianjin University of Finance and Economics, Tianjin 300222, China

No 6-2026, Working Papers from Copenhagen Business School, Department of Economics

Abstract: Amid the global green energy transition, China faces bottlenecks in renewable energy integration due to underdeveloped market-based trading systems. To address this gap, this study investigates the effectiveness of distributed power generation trading (DPGT) using panel data of Chinese cities between 2014 and 2023 and a multi-period difference-in-differences model. The findings show that (1) DPGT has significantly promoted the development of green energy industries; (2) the aggregation of talent and capital elements and green technology cooperation facilitate industrial growth; (3) the policy effects are more pronounced in non-resource-based cities, high energy-consuming cities, and cities that prioritize DPGT industries; (4) DPGT reduces emissions of conventional pollutants by displacing traditional thermal power generation. However, due to the peak shaving of thermal power and rebound effect, its carbon emissions reduction has not met expectations.

Keywords: Distributed power generation trading (DPGT); Market-oriented trading; Green energy industry; Talent and capital aggregation; Green technology cooperation (search for similar items in EconPapers)
JEL-codes: C21 H23 Q51 Q58 R12 (search for similar items in EconPapers)
Pages: 55 pages
Date: 2026-02-25
New Economics Papers: this item is included in nep-cna, nep-ene and nep-env
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