Reducing Carbon emissions through pipelines? Evidence from the West-East Gas Pipeline Project

Transregional energy transmission can help balance resource allocation and serve long-term regional interests. The West–East Gas Pipeline Project (WEGPP), which is the longest natural gas pipeline in China, aims to address the serious imbalance between natural gas supply and demand in China’s eastern and western regions. Few studies have considered WEGPP’s effect on carbon emissions in terms of energy transmission. Using data for prefecture-level cities from 2000 to 2019, we consider WEGPP as a quasi-natural experiment and adopt a staggered difference-in-differences model to investigate the causal effect of energy transmission on carbon emissions. We find that WEGPP can reduce carbon emissions; various robustness tests confirm the reliability of the results. However, the emission-reduction effect is heterogeneous owing to factors such as operation batch, location, administrative level, population size, resource endowment, industrial level, and whether a city belongs to an old industrial base. We also reveal three important channels for WEGPP’s emission-reduction effect: environmental concern of the government, industrial agglomeration, and green technological innovation. This study provides a reference for assessing the feasibility and effectiveness of energy transmission in the context of emission reduction.Compared to cities without natural gas transmission, WEGPP can reduce carbon emissions by 10.9% in cities with natural gas transmission.WEGPP’s emission-reduction effect includes three important channels: environmental concern of the government, industrial agglomeration, and green technological innovation.The emission-reduction effect exhibits heterogeneity according to urban characteristics. The government should ensure a precise integration of natural gas distribution systems with urban characteristics.