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Complementarity or crowding out? The impact of environmental policy combination on renewable energy technology innovation

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  • Shen, Jun
  • He, Jiana
  • Liu, Xiuli
  • Shi, Qinqin

Abstract

In order to address issues such as air pollution and excessive carbon emissions, China has implemented targeted environmental policies such as emissions trading (ET) and carbon emissions trading (CET) to promote technological innovation and sustainable development. However, the impact of this policy combination on the innovation of renewable energy technologies remains unclear. To fill this gap, this paper explores the impact of the ET and CET environmental policy combination on renewable energy technology innovation and their spatial spillover effects, using a multi-period difference-in-differences model and spatial econometric model. The results show: The policy combination can promote renewable energy technology innovation in pilot regions. Compared with single policies, the promoting effect of policy combinations is more pronounced, that is, achieving policy complementarity effects. Policy combinations can better promote renewable energy technology innovation in eastern regions and high economic development regions. In the fields of photovoltaic power, wind power and ocean power, the promoting effect of policy combinations on technological innovation is more significant. Spatial effect analysis indicates that policy combinations have a significant positive spatial spillover effect on renewable energy technology innovation, which should not be ignored. Therefore, the government should enhance cross-regional cooperation, continuously promote energy structure transformation, and innovate renewable energy technologies.

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  • Shen, Jun & He, Jiana & Liu, Xiuli & Shi, Qinqin, 2025. "Complementarity or crowding out? The impact of environmental policy combination on renewable energy technology innovation," Renewable Energy, Elsevier, vol. 248(C).
    • Handle: RePEc:eee:renene:v:248:y:2025:i:c:s0960148125008584
    DOI: 10.1016/j.renene.2025.123196
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    2. Xie, Yongjing & Lin, Boqiang, 2026. "Driving urban sustainable development: The role of renewable energy technology innovation in enhancing urban environmental efficiency," Renewable and Sustainable Energy Reviews, Elsevier, vol. 226(PA).
    3. Jing Zhang & Jun Shen & Zhifang Wu & Lei Nie, 2025. "Pollution Transfer or Industrial Upgrading: The Impact of Energy Conservation and Emission Reduction Fiscal Policy on Urban Green Total Factor Productivity in China," Sustainability, MDPI, vol. 17(20), pages 1-24, October.

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