Aligning renewable energy targets with carbon emissions trading to achieve China's INDCs: A general equilibrium assessment

Hancheng Dai, Yang Xie, Jingyu Liu and Toshihiko Masui

Renewable and Sustainable Energy Reviews, 2018, vol. 82, issue P3, 4121-4131

Abstract: This study evaluates the economic impact of achieving China's Intended Nationally Determined Contributions (INDCs) through emissions trading scheme (ETS) and renewable energy policy, using a Computable General Equilibrium (CGE) model. We explored the behavior of different sectors in the carbon market, carbon trade amount, carbon price and the economic impact of an emissions cap and trade on the employment and GDP. The results demonstrate that the electricity and aviation sectors have relatively higher mitigation costs and tend to be the main buyers of the carbon credits, whereas chemicals, nonmetal production, iron and steel, paper and other manufacturing sectors have relatively lower mitigation costs and tend to be the main sellers. Carbon trading price and market scale are closely related to various factors such as the emissions quota allocation scheme among sectors, coverage of participating sectors and the level of renewable energy development. Emission trading is also confirmed to be an economically efficient approach that contributes to the achievement of emission reduction targets with less economic cost. In order to make full use of this approach, policy maker should assign an appropriate emissions quota allocation scheme, extend coverage of various sectors and promote the expansion of low-carbon technologies such as renewable energy.

Keywords: Carbon emissions trading; Renewable energy; Economic impact; Computable general equilibrium (CGE) model; China (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (43)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S136403211731434X
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:rensus:v:82:y:2018:i:p3:p:4121-4131

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/600126/bibliographic
http://www.elsevier. ... 600126/bibliographic

DOI: 10.1016/j.rser.2017.10.061

Access Statistics for this article

Renewable and Sustainable Energy Reviews is currently edited by L. Kazmerski

More articles in Renewable and Sustainable Energy Reviews from Elsevier
Bibliographic data for series maintained by Catherine Liu ().