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Heat tariff and subsidy in China based on heat cost analysis

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  • Lin, Jing
  • Lin, Boqiang

Abstract

This paper addresses an important issue surrounding heating supply system reform and seeks to evaluate China's heat tariff and heating subsidy from the perspective of the heating cost in the thermoelectric industry in various provinces in China. We present an algorithm for estimating environmental externality included heat tariff based on the analysis of heat cost in total thermoelectric cost. The results show that during 1999–2014 the average proportion of heating cost in total thermoelectric cost in the north is higher than in the south, which is 26.3% and 24.1% respectively. Generally, subsidies hidden in the existing heat tariffs subsidize heat consumers. Specifically, hidden subsidies subsidize residential consumer more than non-residential consumer in China.

Suggested Citation

  • Lin, Jing & Lin, Boqiang, 2018. "Heat tariff and subsidy in China based on heat cost analysis," Energy Economics, Elsevier, vol. 71(C), pages 411-420.
    • Handle: RePEc:eee:eneeco:v:71:y:2018:i:c:p:411-420
    DOI: 10.1016/j.eneco.2018.03.012
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    Cited by:

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    2. Guo, Xiaodan & Xiao, Bowen, 2022. "How can pricing strategy for district heating help China realize cleaner residential heating?," Energy Economics, Elsevier, vol. 110(C).
    3. Wang, Manyu & Huang, Ying & An, Zidong & Wei, Chu, 2023. "Reforming the world's largest heating system: Quasi-experimental evidence from China," Energy Economics, Elsevier, vol. 117(C).
    4. Søren Djørup & Karl Sperling & Steffen Nielsen & Poul Alborg Østergaard & Jakob Zinck Thellufsen & Peter Sorknæs & Henrik Lund & David Drysdale, 2020. "District Heating Tariffs, Economic Optimisation and Local Strategies during Radical Technological Change," Energies, MDPI, vol. 13(5), pages 1-15, March.
    5. Qiang Wang & Zhongfu Tan & Gejirifu De & Qingkun Tan & Lei Pu, 2019. "An Evolutionary Game Study of Clean Heating Promotion Mechanisms under the Policy Regulation in China," Sustainability, MDPI, vol. 11(14), pages 1-22, July.

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    More about this item

    Keywords

    Heating cost; Heat tariff; Heating subsidy; Shadow price; Output distance function;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • C60 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - General
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • P18 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Energy; Environment

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