Carbon Abatement and Leakage in China’s Regional Carbon Emission Trading
Emission trading schemes (ETS) are increasingly becoming a popular policy instrument to balance carbon abatement and economic growth. As a globally unified carbon pricing system has not yet been established, whether regionally operated ETSs cause carbon leakage remains a major concern. Taking China’...
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Veröffentlicht in: | Environmental science & technology 2024-10, Vol.58 (40), p.17661-17673 |
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creator | Jiang, Jingjing Ye, Bin Zeng, Zhenzhong Yang, Xin Sun, Zhuoluo Shao, Shuai Feng, Kuishuang Tan, Xiujie |
description | Emission trading schemes (ETS) are increasingly becoming a popular policy instrument to balance carbon abatement and economic growth. As a globally unified carbon pricing system has not yet been established, whether regionally operated ETSs cause carbon leakage remains a major concern. Taking China’s regional pilot ETSs as a quasi-natural experiment, the study uses the spatial difference-in-differences method to examine how regional ETSs affect carbon emissions in and outside cities of policy implementation. Our analysis finds that China’s regional ETS policy contributes to a 6.1% reduction in urban CO2 emissions and a 6.6% decline in emissions intensity in regulated cities, causing carbon leakages that increase CO2 emissions in neighboring cities by 1.7% on average. Our finding further suggests that regional ETSs mitigate local CO2 emissions through outsourcing production, improving energy efficiency and decarbonizing energy structure, whereas the outsourcing of industrial production drives up CO2 emissions in adjacent cities. Moreover, the performances of regional ETSs vary largely by socioeconomic context and mechanism design. China’s regional ETSs reduce CO2 emissions more effectively in central and industrial cities but with more severe carbon leakage, while rigorous compliance mechanisms and active market trading help deepen carbon abatement and alleviate carbon leakage. |
doi_str_mv | 10.1021/acs.est.4c04738 |
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As a globally unified carbon pricing system has not yet been established, whether regionally operated ETSs cause carbon leakage remains a major concern. Taking China’s regional pilot ETSs as a quasi-natural experiment, the study uses the spatial difference-in-differences method to examine how regional ETSs affect carbon emissions in and outside cities of policy implementation. Our analysis finds that China’s regional ETS policy contributes to a 6.1% reduction in urban CO2 emissions and a 6.6% decline in emissions intensity in regulated cities, causing carbon leakages that increase CO2 emissions in neighboring cities by 1.7% on average. Our finding further suggests that regional ETSs mitigate local CO2 emissions through outsourcing production, improving energy efficiency and decarbonizing energy structure, whereas the outsourcing of industrial production drives up CO2 emissions in adjacent cities. Moreover, the performances of regional ETSs vary largely by socioeconomic context and mechanism design. China’s regional ETSs reduce CO2 emissions more effectively in central and industrial cities but with more severe carbon leakage, while rigorous compliance mechanisms and active market trading help deepen carbon abatement and alleviate carbon leakage.</description><identifier>ISSN: 0013-936X</identifier><identifier>ISSN: 1520-5851</identifier><identifier>EISSN: 1520-5851</identifier><identifier>DOI: 10.1021/acs.est.4c04738</identifier><identifier>PMID: 39186463</identifier><language>eng</language><publisher>United States: American Chemical Society</publisher><subject>Carbon ; Carbon Dioxide ; Carbon dioxide emissions ; China ; Cities ; Decarbonization ; Economic development ; Economic growth ; Emissions ; Emissions trading ; Energy and Climate ; Energy efficiency ; Industrial production ; Leakage ; Outsourcing ; Regional analysis</subject><ispartof>Environmental science & technology, 2024-10, Vol.58 (40), p.17661-17673</ispartof><rights>2024 The Authors. 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Sci. Technol</addtitle><description>Emission trading schemes (ETS) are increasingly becoming a popular policy instrument to balance carbon abatement and economic growth. As a globally unified carbon pricing system has not yet been established, whether regionally operated ETSs cause carbon leakage remains a major concern. Taking China’s regional pilot ETSs as a quasi-natural experiment, the study uses the spatial difference-in-differences method to examine how regional ETSs affect carbon emissions in and outside cities of policy implementation. Our analysis finds that China’s regional ETS policy contributes to a 6.1% reduction in urban CO2 emissions and a 6.6% decline in emissions intensity in regulated cities, causing carbon leakages that increase CO2 emissions in neighboring cities by 1.7% on average. 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China’s regional ETSs reduce CO2 emissions more effectively in central and industrial cities but with more severe carbon leakage, while rigorous compliance mechanisms and active market trading help deepen carbon abatement and alleviate carbon leakage.</description><subject>Carbon</subject><subject>Carbon Dioxide</subject><subject>Carbon dioxide emissions</subject><subject>China</subject><subject>Cities</subject><subject>Decarbonization</subject><subject>Economic development</subject><subject>Economic growth</subject><subject>Emissions</subject><subject>Emissions trading</subject><subject>Energy and Climate</subject><subject>Energy efficiency</subject><subject>Industrial production</subject><subject>Leakage</subject><subject>Outsourcing</subject><subject>Regional analysis</subject><issn>0013-936X</issn><issn>1520-5851</issn><issn>1520-5851</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2024</creationdate><recordtype>article</recordtype><sourceid>EIF</sourceid><recordid>eNp1kc1KAzEUhYMotlbX7mTAjSBTc_M7XUkp9Y-CIBXchWSaaadOMzVpBXe-hq_nk5jSWlRwFUi-c3LvOQgdA24DJnCh89C2YdFmOWaSZjuoCZzglGccdlETY6Bph4qnBjoIYYoxJhRn-6hBO5AJJmgT3fW0N7VLukYv7My6RaLdKBlY_azHNild0puUTn--f4TkwY7L2ukq2Uj6szKEeJMMvR6VbnyI9gpdBXu0OVvo8ao_7N2kg_vr2153kGqKYZEKroklLAfOTGGsyQTlWAhGWEZoIYwhRFAoCKWWggQgRWaslIQZJgtBJW2hy7XvfGlmdpTHob2u1NyXM-3fVK1L9fvFlRM1rl8VABNcSh4dzjYOvn5ZxvxUXCW3VaWdrZdBUdyRrBOjEhE9_YNO66WPKUQKgMuMMEkidbGmcl-H4G2xnQawWhWlYlFqpd4UFRUnP5fY8t_NROB8DayU2z__s_sC6NudrA</recordid><startdate>20241008</startdate><enddate>20241008</enddate><creator>Jiang, Jingjing</creator><creator>Ye, Bin</creator><creator>Zeng, Zhenzhong</creator><creator>Yang, Xin</creator><creator>Sun, Zhuoluo</creator><creator>Shao, Shuai</creator><creator>Feng, Kuishuang</creator><creator>Tan, Xiujie</creator><general>American Chemical Society</general><scope>CGR</scope><scope>CUY</scope><scope>CVF</scope><scope>ECM</scope><scope>EIF</scope><scope>NPM</scope><scope>AAYXX</scope><scope>CITATION</scope><scope>7QO</scope><scope>7ST</scope><scope>7T7</scope><scope>7U7</scope><scope>8FD</scope><scope>C1K</scope><scope>FR3</scope><scope>P64</scope><scope>SOI</scope><scope>7X8</scope><scope>5PM</scope><orcidid>https://orcid.org/0000-0002-9173-1188</orcidid><orcidid>https://orcid.org/0000-0001-9227-839X</orcidid><orcidid>https://orcid.org/0000-0001-5139-444X</orcidid></search><sort><creationdate>20241008</creationdate><title>Carbon Abatement and Leakage in China’s Regional Carbon Emission Trading</title><author>Jiang, Jingjing ; 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Sci. Technol</addtitle><date>2024-10-08</date><risdate>2024</risdate><volume>58</volume><issue>40</issue><spage>17661</spage><epage>17673</epage><pages>17661-17673</pages><issn>0013-936X</issn><issn>1520-5851</issn><eissn>1520-5851</eissn><abstract>Emission trading schemes (ETS) are increasingly becoming a popular policy instrument to balance carbon abatement and economic growth. As a globally unified carbon pricing system has not yet been established, whether regionally operated ETSs cause carbon leakage remains a major concern. Taking China’s regional pilot ETSs as a quasi-natural experiment, the study uses the spatial difference-in-differences method to examine how regional ETSs affect carbon emissions in and outside cities of policy implementation. Our analysis finds that China’s regional ETS policy contributes to a 6.1% reduction in urban CO2 emissions and a 6.6% decline in emissions intensity in regulated cities, causing carbon leakages that increase CO2 emissions in neighboring cities by 1.7% on average. Our finding further suggests that regional ETSs mitigate local CO2 emissions through outsourcing production, improving energy efficiency and decarbonizing energy structure, whereas the outsourcing of industrial production drives up CO2 emissions in adjacent cities. Moreover, the performances of regional ETSs vary largely by socioeconomic context and mechanism design. 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subjects | Carbon Carbon Dioxide Carbon dioxide emissions China Cities Decarbonization Economic development Economic growth Emissions Emissions trading Energy and Climate Energy efficiency Industrial production Leakage Outsourcing Regional analysis |
title | Carbon Abatement and Leakage in China’s Regional Carbon Emission Trading |
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