The Time-Frequency Correlation between Carbon Market and New Energy Markets: An Advanced Modeling Approach Based on Wavelet Analysis

Against the backdrop of accelerating global low-carbon transition and the continuous improvement of carbon constraint mechanisms, the carbon market, as an important market-oriented tool for energy conservation and emission reduction, has drawn increasing attention for its linkage with the new energy market. With the gradual maturation of carbon pricing mechanisms, the price correlation between carbon assets and traditional energy stocks has become more pronounced. Their dynamic interactive effects directly influence energy structure adjustment and the development of a low-carbon economy. This paper adopts an advanced modeling method based on wavelet analysis to explore the time-frequency correlation between the carbon market and the new energy markets. By introducing wavelet transform and wavelet coherence analysis, we construct a multi-scale dynamic correlation model to examine the linkage characteristics of carbon prices with photovoltaic, wind, hydropower, and nuclear energy stock prices across short-, medium-, and long-term horizons. The findings provide theoretical grounding and empirical evidence for cross-market risk hedging, low-carbon policy formulation, and energy market decision-making.