Greening the Grid: How UHV Development Drives Corporate Green Innovation

Yajie Sun, Yilan Luo and Feng Han

Energy Economics, 2025, vol. 149, issue C

Abstract: Most existing studies on green innovation emphasize demand-side drivers, such as environmental regulations and market incentives that increase firms' returns on developing new technologies. In contrast, supply-side factors—improvements in conditions that facilitate innovation activities—remain less studied. This study addresses this gap by examining how integrating regions into China's Ultra High Voltage (UHV) electricity transmission network influences firm-level green innovation. Using data from Chinese listed firms between 2006 and 2016, we find that UHV integration significantly increases green patent applications, especially in receiving end regions where electricity supply stability and availability improve. This positive effect appears to be driven by increased R&D investment, particularly in industries with higher electricity intensity. Furthermore, firms without prior green innovation experience benefit more, suggesting that supply-side enhancements like UHV integration help lower entry barriers to green innovation. Additional heterogeneity analysis shows greater impacts for younger firms, those listed on ChiNext, firms with fewer intangible assets, lower industry concentration, a higher share of female executives, and less concentrated ownership. These results underscore the crucial but understudied role of energy infrastructure development as a supply-side catalyst for green technological progress.

Keywords: Energy infrastructure; Ultra high voltage; Green innovation; Energy input (search for similar items in EconPapers)
JEL-codes: O31 O32 Q41 R11 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:149:y:2025:i:c:s0140988325005997

DOI: 10.1016/j.eneco.2025.108772

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