The Effectiveness and Trade-Offs of Renewable Energy Policies in Achieving the Dual Decarbonization Goals in China: A Dynamic Computable General Equilibrium Analysis

Wei Wei, Ling He, Xiaofan Li, Qi Cui and Hao Chen
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Wei Wei: Management Academy of China Cooperatives, Beijing 100028, China
Ling He: School of Economics, Beijing Wuzi University, Beijing 101149, China
Xiaofan Li: Beijing Key Lab of Study on Sci-Tech Strategy for Urban Green Development, School of Economics and Resource Management, Beijing Normal University, Beijing 100875, China
Qi Cui: Beijing Key Lab of Study on Sci-Tech Strategy for Urban Green Development, School of Economics and Resource Management, Beijing Normal University, Beijing 100875, China
Hao Chen: Beijing Key Lab of Study on Sci-Tech Strategy for Urban Green Development, School of Economics and Resource Management, Beijing Normal University, Beijing 100875, China

IJERPH, 2022, vol. 19, issue 11, 1-18

Abstract: China’s government has enforced a series of renewable energy policies to promote renewable energy development and achieve the dual decarbonization goals. However, there exists great disparity in previous studies on the effectiveness and suitability of renewable energy policies in abating carbon emissions. This study employs a dynamic general equilibrium model and assesses the effectiveness and trade-offs of renewable energy policies in achieving the dual decarbonization goals by 2060 in China. These policies include carbon market (CRP), the reduction of feed-in tariffs (FIT), the reduction of fossil fuel subsidies (FSB), the reduction of renewable energy costs (REC), resource taxes (RTX), and renewable portfolio standards (REP) as well as the mix of these policies. We find that renewable energy policies together could abate China’s CO 2 emissions in 2060 by 2.57 billion tons, but their effectiveness is very different. The REC would have the greatest effectiveness in abating CO 2 emissions, followed by REP and CRP. Renewable energy policies would cause relatively slight damage to China’s GDP, with the exception of the REC (raising GDP by 1.1713%). Regarding trade-offs, most policies will sacrifice China’s internal and external demand but benefit employment. Renewable energy policies will effectively promote the low-carbon transformation of China’s energy structure.

Keywords: effectiveness; trade-offs; renewable energy policies; dual decarbonization goals; China (search for similar items in EconPapers)
JEL-codes: I I1 I3 Q Q5 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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