The heterogeneous effects of non-hydro renewable energy and water resources on industrial development of the Yellow river and Yangtze river basins

Exploring the relationship between non-hydro renewable energy (NHRE) and water resources can help achieve high-quality development in China’s industrial sector under the constraints of water conservation. This study investigated the interrelationships and regional heterogeneity of capital, labor, water and NHRE in the industrial sectors of 158 cities in the Yellow River Basin (YRB) and Yangtze River Basin (YZRB) in China using a heterogeneous stochastic frontier model. Based on reconstructed NHRE consumption data, it is found that the NHRE output elasticity (OE) in the NHRE-rich YRB (median value: 0.1) was lower than that in the NHRE-scarce YZRB (0.24), while the water OE in the water-rich YZRB (0.07) was lower than that in the water-scarce YRB (0.09). Classification analysis of infrastructure construction revealed that the energy OE in NHRE outflow regions (0.11) was lower than in NHRE inflow regions (0.28). This study also optimized the allocation of projected NHRE additions in China by 2030 and found that the optimized strategy can generate an additional industrial output of 8.8 × 1011 Yuan and save 8.6 × 107 tons of water compared to existing strategies. The results indicated that a win-win situation of industrial growth and water conservation could be achieved by reallocation of NHRE. •Consumption data of non-hydro renewable energy in China was reconstructed.•The promotion effect of NHRE in industries was higher in NHRE consumption areas.•Significant basin heterogeneity was observed in the NHRE-water nexus.•Allocation strategies of NHRE under different scenarios were explored for 2030.