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Inter-fuel Substitution in the Chinese Iron and Steel Sector

Russell Smyth, Paresh Narayan () and Hongliang Shi

No 22-10, Monash Economics Working Papers from Monash University, Department of Economics

Abstract: China’s iron and steel sector is the largest in the world and has been the backbone of Chinese heavy industry. This sector is also a major consumer of energy and, in particular, coal. As a result, the iron and steel sector in China is a major contributor to greenhouse gas emissions and other pollutants. In this paper we examine the potential for inter-fuel substitution between coal, electricity, natural gas and oil in the Chinese iron and steel sector and find that these energy inputs are substitutes. The finding that these alternative energy sources are substitutes for coal suggests that China has the potential to switch from coal to cleaner energy sources; hence, retaining the ability to fuel its iron and steel sector, while reducing the adverse environmental implications.

Keywords: China; inter-fuel substitution; iron and steel (search for similar items in EconPapers)
JEL-codes: D24 O33 Q41 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2010-05
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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