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Does green finance regulation improve renewable energy utilization? Evidence from energy consumption efficiency

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  • Cheng, Zhuo
  • Kai, Zhe
  • Zhu, Shouwenjun

Abstract

Green finance aims to balance economic growth, environmental conservation, and sustainable development. Exploiting the green finance reform and innovation pilot zone policy in China, this study aims to examine the impact of green finance regulation on renewable energy utilization at the firm level. Adopting energy consumption efficiency as a measure of renewable energy utilization, the difference-in-difference estimation results show that, firms’ renewable energy utility in the pilot regions is enhanced by the regulation and this result is robust after several tests. The financing constraints and the corporate digitalization are the economic channels by which the green finance policy stimulates corporate renewable energy utility. In addition, this simulation impact is more prominent in small firms, young firms, and firms with weak governance corporations. In general, our study offers new evidence of advantages of green finance regulation.

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  • Cheng, Zhuo & Kai, Zhe & Zhu, Shouwenjun, 2023. "Does green finance regulation improve renewable energy utilization? Evidence from energy consumption efficiency," Renewable Energy, Elsevier, vol. 208(C), pages 63-75.
    • Handle: RePEc:eee:renene:v:208:y:2023:i:c:p:63-75
    DOI: 10.1016/j.renene.2023.03.083
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    2. Weicheng Xu & Xiaoyi Feng & Yiying Zhu, 2023. "The Impact of Green Finance on Carbon Emissions in China: An Energy Consumption Optimization Perspective," Sustainability, MDPI, vol. 15(13), pages 1-23, July.
    3. Libin Feng & Zhengcheng Sun, 2023. "The Impact of Green Finance Pilot Policy on Carbon Intensity in Chinese Cities—Based on the Synthetic Control Method," Sustainability, MDPI, vol. 15(15), pages 1-21, July.
    4. Lin Wang & Yugang He & Renhong Wu, 2024. "Digitization Meets Energy Transition: Shaping the Future of Environmental Sustainability," Energies, MDPI, vol. 17(4), pages 1-25, February.

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    More about this item

    Keywords

    Green finance regulation; Renewable energy utilization; Difference-in-differences; China;
    All these keywords.

    JEL classification:

    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation

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