Natural gas and the battle of carbon emissions: Interpreting the spatial effects of provincial carbon emissions in China

Xiaohang Ren, Qian Lu, Giray Gözgör and Haiqin Fu

International Review of Economics & Finance, 2025, vol. 97, issue C

Abstract: China has consistently sought clean energy solutions to mitigate carbon emissions, with natural gas being an effective alternative. Utilizing carbon emissions data from China spanning 2010 to 2020, this study applies spatial econometric models to analyze the spatial effects of natural gas consumption on provincial carbon emissions. The study identifies spatial patterns in carbon emissions across China and notes σ convergence among provincial emissions. Additionally, the effectiveness of natural gas in mitigating carbon emissions is affected by factors such as pricing, geographic location, and economic development levels, rather than resulting in direct emission reductions. Natural gas usage elevates carbon emissions within the province while curbing emissions in neighboring regions. Moreover, mediation mechanisms reveal that natural gas consumption can indirectly enhance carbon emissions via agricultural expansion, economic progress, and uncertainties in climate policies. The results illustrate that the mechanisms influencing the carbon reduction effects of natural gas are multifaceted. Achieving significant reductions in carbon emissions through natural gas necessitates a holistic consideration of factors such as spatial spillover, pricing, and economic development levels.

Keywords: Carbon emissions; Spatial spillover; Natural gas; Mechanism analysis (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:97:y:2025:i:c:s105905602400827x

DOI: 10.1016/j.iref.2024.103835

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