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Reaping the Economic Benefits of Decarbonization for China

Author

Listed:
  • Fei Teng

    (Institute of Energy, Environment and Economy, Research Center for Contemporary Management, Tsinghua University)

  • Frank Jotzo

    (Crawford School of Public Policy, The Australian National University)

Abstract

China needs to reduce its carbon emissions if global climate change mitigation is to succeed. Conventional economic analysis views cutting emissions as a cost, creating a collective action problem. However, decarbonization can improve productivity and provide co-benefits that accord with multiple national policy objectives. We track China's progress in reducing the emissions intensity of the economy, and construct a macro scenario with China's carbon emissions peaking in the 2020s. Investment in greater energy productivity and economic restructuring away from heavy industries can bring productivity gains, and decarbonization of energy supply has important co-benefits for air pollution and energy security. Combined with lower climate change risks and the likelihood that China's actions will influence other countries, this suggests that cutting carbon emissions is not only in China's self-interest but also in the global interest. To properly identify the true costs and benefits of climate change action requires new thinking in economic analysis.

Suggested Citation

  • Fei Teng & Frank Jotzo, 2014. "Reaping the Economic Benefits of Decarbonization for China," CCEP Working Papers 1413, Centre for Climate & Energy Policy, Crawford School of Public Policy, The Australian National University.
  • Handle: RePEc:een:ccepwp:1413
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    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. China heads for a price on carbon amid an energy market overhaul
      by Frank Jotzo, Director, Centre for Climate Economics and Policy at Australian National University in The Conversation on 2014-09-19 08:59:13
    2. China heads for a price on carbon amid an energy market overhaul
      by ? in ANU News on 2014-09-19 11:27:00
    3. Energy market reform needed as China heads for national emissions trading
      by Frank Jotzo in East Asia Forum on 2014-09-23 17:00:10

    Citations

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    Cited by:

    1. Fankhauser, Samuel & Jotzo, Frank, 2017. "Economic growth and development with low-carbon energy," LSE Research Online Documents on Economics 86850, London School of Economics and Political Science, LSE Library.
    2. Zhang, ZhongXiang, "undated". "Making China the transition to a low-carbon economy: Key challenges and responses," Working Papers 249516, Australian National University, Centre for Climate Economics & Policy.
    3. Bilgili, Faik & Mugaloglu, Erhan & Koçak, Emrah, 2018. "The impact of oil prices on CO2 emissions in China: A Wavelet coherence approach," MPRA Paper 90170, University Library of Munich, Germany.
    4. Livia Cabernard & Stephan Pfister & Christopher Oberschelp & Stefanie Hellweg, 2022. "Growing environmental footprint of plastics driven by coal combustion," Nature Sustainability, Nature, vol. 5(2), pages 139-148, February.
    5. ZhongXiang Zhang, 2017. "Are China's climate commitments in a post‐Paris agreement sufficiently ambitious?," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 8(2), March.
    6. Rodríguez, Miguel, 2022. "Why do many prospective analyses of CO2 emissions fail? An illustrative example from China," Energy, Elsevier, vol. 244(PB).
    7. Tiwari, Sunil & Si Mohammed, Kamel & Guesmi, Khaled, 2023. "A way forward to end energy poverty in China: Role of carbon-cutting targets and net-zero commitments," Energy Policy, Elsevier, vol. 180(C).
    8. ZhongXiang Zhang, 2016. "Making the Transition to a Low-Carbon Economy: The Key Challenges for China," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 3(2), pages 187-202, May.
    9. Jang, Yeonju & Park, Eunil, 2020. "Social acceptance of nuclear power plants in Korea: The role of public perceptions following the Fukushima accident," Renewable and Sustainable Energy Reviews, Elsevier, vol. 128(C).

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    More about this item

    Keywords

    China; climate change mitigation; co-benefits;
    All these keywords.

    JEL classification:

    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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