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Factors That Influence Renewable Energy Technological Innovation in China: A Dynamic Panel Approach

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  • Zheng-Xia He

    () (College of Economics and Management, Nanjing Forestry University, Nanjing 210037, China)

  • Shi-Chun Xu

    () (Management School, China University of Mining and Technology, Xuzhou 221116, China)

  • Qin-Bin Li

    (Joint Institute for Regional Earth System Science and Engineering, Department of Atmospheric and Oceanic Sciences, University of California, Los Angeles, CA 90095, USA)

  • Bin Zhao

    () (Joint Institute for Regional Earth System Science and Engineering, Department of Atmospheric and Oceanic Sciences, University of California, Los Angeles, CA 90095, USA)

Abstract

We examine the driving effects of various factors on technological innovation to renewables (TIRES), focusing on a set of 29 provinces in China, and apply a dynamic panel approach. China has become a leading player in research and development spending in renewables, and the dynamic panel estimators we use prove themselves to be suitable in handling the persistent effect on TIRES. The level of TIRES in the previous periods is positively and highly correlated with that in the current period and confirmed the need for a stable and consistent policy support for renewables. Electricity consumption is the most important driver for all renewables and wind energy, but the driving effect was weaker for solar energy and biomass. Research and development intensity is the most important driver for biomass, but is only the second most important driver for all renewables, solar energy and wind energy. Unexpectedly, electricity price has had significant negative impacts on TIRES, which reveals that lowering electricity prices will lead to higher innovation in renewables. The driving effect of renewable energy tariff surcharge subsidy is not significant, which means that Chinese subsidy policy has not played the desired role. The driving effect of installed renewable energy capacity is also minimal, which may be due to the fact that overcapacity will hinder TIRES in China. This paper may help policy-makers and the industry understand how to promote TIRES in China effectively based on these above influential factors.

Suggested Citation

  • Zheng-Xia He & Shi-Chun Xu & Qin-Bin Li & Bin Zhao, 2018. "Factors That Influence Renewable Energy Technological Innovation in China: A Dynamic Panel Approach," Sustainability, MDPI, Open Access Journal, vol. 10(1), pages 1-30, January.
  • Handle: RePEc:gam:jsusta:v:10:y:2018:i:1:p:124-:d:125820
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    Cited by:

    1. Sung, Bongsuk, 2019. "Do government subsidies promote firm-level innovation? Evidence from the Korean renewable energy technology industry," Energy Policy, Elsevier, vol. 132(C), pages 1333-1344.
    2. Bongsuk Sung & Myoung Shik Choi & Woo-Yong Song, 2019. "Exploring the Effects of Government Policies on Economic Performance: Evidence Using Panel Data for Korean Renewable Energy Technology Firms," Sustainability, MDPI, Open Access Journal, vol. 11(8), pages 1-19, April.
    3. Kalon Si & Xin Long Xu & Hsing Hung Chen, 2020. "Examining the Interactive Endogeneity Relationship between R&D Investment and Financially Sustainable Performance: Comparison from Different Types of Energy Enterprises," Energies, MDPI, Open Access Journal, vol. 13(9), pages 1-15, May.
    4. Xiaoli Wang & Yun Liu & Yanbing Ju, 2018. "Sustainable Public Procurement Policies on Promoting Scientific and Technological Innovation in China: Comparisons with the U.S., the UK, Japan, Germany, France, and South Korea," Sustainability, MDPI, Open Access Journal, vol. 10(7), pages 1-27, June.
    5. Zheng, Mingbo & Feng, Gen-Fu & Feng, Suling & Yuan, Xuemei, 2019. "The road to innovation vs. the role of globalization: A dynamic quantile investigation," Economic Modelling, Elsevier, vol. 83(C), pages 65-83.
    6. Lin, Boqiang & Chen, Yufang, 2019. "Does electricity price matter for innovation in renewable energy technologies in China?," Energy Economics, Elsevier, vol. 78(C), pages 259-266.
    7. Anas A. Makki & Ibrahim Mosly, 2020. "Factors Affecting Public Willingness to Adopt Renewable Energy Technologies: An Exploratory Analysis," Sustainability, MDPI, Open Access Journal, vol. 12(3), pages 1-11, January.
    8. Mahmut Unsal Sasmaz & Emre Sakar & Yunus Emre Yayla & Ulas Akkucuk, 2020. "The Relationship between Renewable Energy and Human Development in OECD Countries: A Panel Data Analysis," Sustainability, MDPI, Open Access Journal, vol. 12(18), pages 1-16, September.
    9. Bai, Caiquan & Feng, Chen & Du, Kerui & Wang, Yuansheng & Gong, Yuan, 2020. "Understanding spatial-temporal evolution of renewable energy technology innovation in China: Evidence from convergence analysis," Energy Policy, Elsevier, vol. 143(C).
    10. Govinda Hosein & Patrick Hosein & Sanjay Bahadoorsingh & Robert Martinez & Chandrabhan Sharma, 2020. "Predicting Renewable Energy Investment Using Machine Learning," Energies, MDPI, Open Access Journal, vol. 13(17), pages 1-9, August.

    More about this item

    Keywords

    renewable energy; technological innovation; China; dynamic panel;

    JEL classification:

    • Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
    • Q0 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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