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The Effectiveness and Trade-Offs of Renewable Energy Policies in Achieving the Dual Decarbonization Goals in China: A Dynamic Computable General Equilibrium Analysis

Author

Listed:
  • Wei Wei

    (Management Academy of China Cooperatives, Beijing 100028, China)

  • Ling He

    (School of Economics, Beijing Wuzi University, Beijing 101149, China)

  • Xiaofan Li

    (Beijing Key Lab of Study on Sci-Tech Strategy for Urban Green Development, School of Economics and Resource Management, Beijing Normal University, Beijing 100875, China)

  • Qi Cui

    (Beijing Key Lab of Study on Sci-Tech Strategy for Urban Green Development, School of Economics and Resource Management, Beijing Normal University, Beijing 100875, China)

  • Hao Chen

    (Beijing Key Lab of Study on Sci-Tech Strategy for Urban Green Development, School of Economics and Resource Management, Beijing Normal University, Beijing 100875, China)

Abstract

China’s government has enforced a series of renewable energy policies to promote renewable energy development and achieve the dual decarbonization goals. However, there exists great disparity in previous studies on the effectiveness and suitability of renewable energy policies in abating carbon emissions. This study employs a dynamic general equilibrium model and assesses the effectiveness and trade-offs of renewable energy policies in achieving the dual decarbonization goals by 2060 in China. These policies include carbon market (CRP), the reduction of feed-in tariffs (FIT), the reduction of fossil fuel subsidies (FSB), the reduction of renewable energy costs (REC), resource taxes (RTX), and renewable portfolio standards (REP) as well as the mix of these policies. We find that renewable energy policies together could abate China’s CO 2 emissions in 2060 by 2.57 billion tons, but their effectiveness is very different. The REC would have the greatest effectiveness in abating CO 2 emissions, followed by REP and CRP. Renewable energy policies would cause relatively slight damage to China’s GDP, with the exception of the REC (raising GDP by 1.1713%). Regarding trade-offs, most policies will sacrifice China’s internal and external demand but benefit employment. Renewable energy policies will effectively promote the low-carbon transformation of China’s energy structure.

Suggested Citation

  • Wei Wei & Ling He & Xiaofan Li & Qi Cui & Hao Chen, 2022. "The Effectiveness and Trade-Offs of Renewable Energy Policies in Achieving the Dual Decarbonization Goals in China: A Dynamic Computable General Equilibrium Analysis," IJERPH, MDPI, vol. 19(11), pages 1-18, May.
    • Handle: RePEc:gam:jijerp:v:19:y:2022:i:11:p:6386-:d:823017
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    References listed on IDEAS

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    4. Abdul Hayy Haziq Mohamad & Muhamad Rias K. V. Zainuddin & Rossazana Ab-Rahim, 2023. "Does Renewable Energy Transition in the USA and China Overcome Environmental Degradation?," International Journal of Energy Economics and Policy, Econjournals, vol. 13(6), pages 234-243, November.

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