Energy conservation and emission reduction (ECER): System construction and policy combination simulation

Although China has made a lot of achievements in Energy Conservation and Emission Reduction (ECER) initiatives currently, the continued reduction in the ECER space has gradually become one of the bottlenecks hindering the construction of ecological civilization. It is thus imperative that all levels of government develop and introduce more effective policies and measures to further drive the potentiality exploitation of ECER. The purpose of this paper is to examine which policies are more conducive to improving regional ECER levels. By taking Fujian Province as an example, the paper builds an ECER dynamic model and provides integrated incentives from six dimensions including fiscal, tax, emissions trading, finance, industry and technology, and examines their policy effectiveness. The results show that: (1) In the single policy scheme, the tax policy is the most effective, though such effect is less than that of the policy combination; (2) With the increase of the category and quantity of policy combinations, the synergy among policies is so significant that ECER effect is expected to be remarkable; (3) Within the scenarios of policy combination, the technical policy has not contributed to obvious performance improvement, because it requires a longer lag phase to truly experience a prominent innovation spillover of clean technology. This paper elucidates theoretical implications by enriching the social-economic system and underscoring the critical importance of public incentive for the ECER initiative. Also, the findings carry managerial implications by guiding companies to carry out more targeted green and cleaner production activities and providing a valuable reference for the government to make ECER policy. •We develop a dynamic model for ECER of which government subsystem is the operation hub.•We create an ECER policy framework including fiscal, tax, emissions trading, finance, industry and technology.•By the model, we simulate energy consumption and main pollutant emissions variables and examine the ECER policy effect.•We find that the ECER effect of single tax policy is the most significant, compared with other policies.•We find that the effect of ECER policy combination is more salient than the single policy scheme and we suggest an optimal ECER policy portfolio eventually.