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Forecasting the Allocation Ratio of Carbon Emission Allowance Currency for 2020 and 2030 in China

Author

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  • Shihong Zeng

    () (Applied Economics Department, Economic Management School, Beijing University of Technology, Beijing 100124, China
    Finance and Economics Development Research Center, Economic Management School, Beijing University of Technology, Beijing 100124, China)

  • Jiuying Chen

    () (Applied Economics Department, Economic Management School, Beijing University of Technology, Beijing 100124, China
    Finance and Economics Development Research Center, Economic Management School, Beijing University of Technology, Beijing 100124, China)

Abstract

Many countries and scholars have used various strategies to improve and optimize the allocation ratios for carbon emission allowances. This issue is more urgent for China due to the uneven development across the country. This paper proposes a new method that divides low-carbon economy development processes into two separate periods: from 2020 to 2029 and from 2030 to 2050. These two periods have unique requirements and emissions reduction potential; therefore, they must involve different allocation methods, so that reduction behaviors do not stall the development of regional low-carbon economies. During the first period, a more deterministic economic development approach for the carbon emission allowance allocation ratio should be used. During the second period, more adaptive and optimized policy guidance should be employed. We developed a low-carbon economy index evaluation system using the entropy weight method to measure information filtering levels. We conducted vector autoregressive correlation tests, consulted 60 experts for the fuzzy analytic hierarchy process, and we conducted max-min standardized data processing tests. This article presents first- and second-period carbon emission allowance models in combination with a low-carbon economy index evaluation system. Finally, we forecast reasonable carbon emission allowance allocation ratios for China for the periods starting in 2020 and 2030. A good allocation ratio for the carbon emission allowance can help boost China’s economic development and help the country reach its energy conservation and emissions reduction goals.

Suggested Citation

  • Shihong Zeng & Jiuying Chen, 2016. "Forecasting the Allocation Ratio of Carbon Emission Allowance Currency for 2020 and 2030 in China," Sustainability, MDPI, Open Access Journal, vol. 8(7), pages 1-28, July.
  • Handle: RePEc:gam:jsusta:v:8:y:2016:i:7:p:650-:d:73645
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    References listed on IDEAS

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    Cited by:

    1. Zeng, Shihong & Jiang, Xue & Su, Bin & Nan, Xin, 2018. "China's SO2 shadow prices and environmental technical efficiency at the province level," International Review of Economics & Finance, Elsevier, vol. 57(C), pages 86-102.
    2. Saiah, Saiah Bekkar Djelloul & Stambouli, Amine Boudghene, 2017. "Prospective analysis for a long-term optimal energy mix planning in Algeria: Towards high electricity generation security in 2062," Renewable and Sustainable Energy Reviews, Elsevier, vol. 73(C), pages 26-43.
    3. Yoon Seong Kim & Eun Jin Han & So Young Sohn, 2017. "Demand Forecasting for Heavy-Duty Diesel Engines Considering Emission Regulations," Sustainability, MDPI, Open Access Journal, vol. 9(2), pages 1-16, January.
    4. Jindamas Sutthichaimethee & Kuskana Kubaha, 2018. "Forecasting Energy-Related Carbon Dioxide Emissions in Thailand’s Construction Sector by Enriching the LS-ARIMAXi-ECM Model," Sustainability, MDPI, Open Access Journal, vol. 10(10), pages 1-19, October.
    5. Zeng, Shihong & Nan, Xin & Liu, Chao & Chen, Jiuying, 2017. "The response of the Beijing carbon emissions allowance price (BJC) to macroeconomic and energy price indices," Energy Policy, Elsevier, vol. 106(C), pages 111-121.
    6. Siqin Xiong & Yushen Tian & Junping Ji & Xiaoming Ma, 2017. "Allocation of Energy Consumption among Provinces in China: A Weighted ZSG-DEA Model," Sustainability, MDPI, Open Access Journal, vol. 9(11), pages 1-12, November.

    More about this item

    Keywords

    low-carbon economy; index system; carbon emission allowances; allocation ratio;

    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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