Analyzing the Regional Impact of a Fossil Energy Cap in China
Decoupling fossil energy demand from economic growth is crucial to China’s sustainable development. In addition to energy and carbon intensity targets enacted under the Twelfth Five-Year Plan (2011–2015), a coal or fossil energy cap is under discussion as a way to constrain the absolute quantity of...
| Main Authors: | , , , |
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| Format: | Working Paper |
| Language: | en_US |
| Published: |
MIT Joint Program on the Science and Policy of Global Change
2013
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| Online Access: | http://hdl.handle.net/1721.1/75829 |
| _version_ | 1826211028338212864 |
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| author | Zhang, D. Karplus, V. Rausch, S. Zhang, X. |
| author_facet | Zhang, D. Karplus, V. Rausch, S. Zhang, X. |
| author_sort | Zhang, D. |
| collection | MIT |
| description | Decoupling fossil energy demand from economic growth is crucial to China’s sustainable development. In addition to energy and carbon intensity targets enacted under the Twelfth Five-Year Plan (2011–2015), a coal or fossil energy cap is under discussion as a way to constrain the absolute quantity of energy used. Importantly, implementation of such a cap may be compatible with existing policies and institutions. We evaluate the efficiency and distributional implications of alternative energy cap designs using a numerical general equilibrium model of China’s economy, built on the 2007 regional input-output tables for China and the Global Trade Analysis Project global data set. We find that a national cap on fossil energy implemented through a tax on final energy products and an energy saving allowance trading market is the most costeffective design, while a regional coal-only cap is the least cost-effective design. We further find that a regional coal cap results in large welfare losses in some provinces. Capping fossil energy use at the national level is found to be nearly as cost effective as a national CO2 emissions target that penalizes energy use based on carbon content. |
| first_indexed | 2024-09-23T14:59:22Z |
| format | Working Paper |
| id | mit-1721.1/75829 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T14:59:22Z |
| publishDate | 2013 |
| publisher | MIT Joint Program on the Science and Policy of Global Change |
| record_format | dspace |
| spelling | mit-1721.1/758292019-04-12T21:26:24Z Analyzing the Regional Impact of a Fossil Energy Cap in China Zhang, D. Karplus, V. Rausch, S. Zhang, X. Decoupling fossil energy demand from economic growth is crucial to China’s sustainable development. In addition to energy and carbon intensity targets enacted under the Twelfth Five-Year Plan (2011–2015), a coal or fossil energy cap is under discussion as a way to constrain the absolute quantity of energy used. Importantly, implementation of such a cap may be compatible with existing policies and institutions. We evaluate the efficiency and distributional implications of alternative energy cap designs using a numerical general equilibrium model of China’s economy, built on the 2007 regional input-output tables for China and the Global Trade Analysis Project global data set. We find that a national cap on fossil energy implemented through a tax on final energy products and an energy saving allowance trading market is the most costeffective design, while a regional coal-only cap is the least cost-effective design. We further find that a regional coal cap results in large welfare losses in some provinces. Capping fossil energy use at the national level is found to be nearly as cost effective as a national CO2 emissions target that penalizes energy use based on carbon content. We acknowledge the support of the Ministry of Science and Technology of China through the Institute for Energy, Environment, and Economy at Tsinghua University, and the support of the Graduate School at Tsinghua University, which are supporting Zhang Da’s doctoral research as a visiting scholar at the Massachusetts Institute of Technology. We further thank Eni S.p.A., ICF International, Shell International Limited, and the French Development Agency (AFD), founding sponsors of the China Energy and Climate Project. We also grateful for support provided by the Social Science Key Research Program from National Social Science Foundation, China of Grant No. 09&ZD029 and by Rio Tinto China. We would further like to thank John Reilly, Sergey Paltsev, Kyung-min Nam, Henry Chen, Paul Kishimoto and Audrey Resutek for helpful comments, discussion and edits. 2013-01-07T18:07:17Z 2013-01-07T18:07:17Z 2013-01 Working Paper http://hdl.handle.net/1721.1/75829 237 en_US Joint Program Report Series;237 An error occurred on the license name. An error occurred getting the license - uri. application/pdf MIT Joint Program on the Science and Policy of Global Change |
| spellingShingle | Zhang, D. Karplus, V. Rausch, S. Zhang, X. Analyzing the Regional Impact of a Fossil Energy Cap in China |
| title | Analyzing the Regional Impact of a Fossil Energy Cap in China |
| title_full | Analyzing the Regional Impact of a Fossil Energy Cap in China |
| title_fullStr | Analyzing the Regional Impact of a Fossil Energy Cap in China |
| title_full_unstemmed | Analyzing the Regional Impact of a Fossil Energy Cap in China |
| title_short | Analyzing the Regional Impact of a Fossil Energy Cap in China |
| title_sort | analyzing the regional impact of a fossil energy cap in china |
| url | http://hdl.handle.net/1721.1/75829 |
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