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Inter-fuel Substitution in the Chinese Iron and Steel Sector

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  • Russell Smyth
  • Paresh Kumar Narayan
  • Hongliang Shi

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.

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Bibliographic Info

Paper provided by Monash University, Department of Economics in its series Monash Economics Working Papers with number 22-10.

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Length: 33 pages
Date of creation: May 2010
Date of revision:
Handle: RePEc:mos:moswps:2010-22

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Keywords: China; inter-fuel substitution; iron and steel;

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  1. Jefferson, Gary H., 1990. "China's iron and steel industry : Sources of enterprise efficiency and the impact of reform," Journal of Development Economics, Elsevier, vol. 33(2), pages 329-355, October.
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Cited by:
  1. Lin, Boqiang & Wesseh, Presley K., 2013. "Estimates of inter-fuel substitution possibilities in Chinese chemical industry," Energy Economics, Elsevier, vol. 40(C), pages 560-568.
  2. Höök, Mikael & Fantazzini, Dean & Angelantoni, André & Snowden, Simon, 2013. "Hydrocarbon liquefaction: viability as a peak oil mitigation strategy," MPRA Paper 46957, University Library of Munich, Germany.

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