The Sustainable Development of the Economic-Energy-Environment (3E) System under the Carbon Trading (CT) Mechanism: A Chinese Case

Xingang Zhao, Yuzhuo Zhang, Ji Liang, Yanbin Li, Rongda Jia and Ling Wang
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Xingang Zhao: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Yuzhuo Zhang: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Ji Liang: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Yanbin Li: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Rongda Jia: State Grid Energy Conservation Service Co., Ltd., Beijing 100052, China
Ling Wang: State Grid Liaoning Electric Power Co., Ltd., Benxi Power Supply Company, Benxi 117020, China

Sustainability, 2018, vol. 10, issue 1, 1-21

Abstract: The implementation of the carbon trading (CT) mechanism is important for the transformation of China’s renewable energy industry, thereby affecting the structure of energy, economy, and the environment, and determining the sustainable development of China’s economic-energy-environment (3E) system in the future. This paper constructs a 3E system simulation model under the CT mechanism based on the theory of system dynamics and taking the Beijing-Tianjin-Hebei region as an example. We study the internal operation mechanism of the carbon emissions trading system and its impact on 3E by combing the related mechanisms of the CT market, CO 2 emissions, energy consumption, and gross domestic product (GDP), thereby helping to provide references for policy-making institutions. The results show that the implementation of CT can effectively reduce energy consumption growth and carbon emissions in the Beijing-Tianjin-Hebei region, and the negative impact of CT implementation on GDP is significantly lower than its positive impact on reducing carbon emissions and energy consumption. Thus, the CT mechanism is conducive to the sustainable development of the Beijing-Tianjin-Hebei region’s 3E system. In addition, reducing the total amount of quota, reducing free quota, and increasing CT price can effectively promote carbon emission reduction, thus promoting the sustainable development of the 3E system.

Keywords: sustainable development; economic-energy-environment (3E) system; carbon trading (CT); system dynamics (SD); China (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18)

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