Impacts of Total Energy Consumption Control and Energy Quota Allocation on China's Regional Economy Based on A 30-region Computable General Equilibrium Analysis

LI Na; SHI Minjun; SHANG Zhiyuan; YUAN Yongna

doi:10.1007/s11769-015-0739-0

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LI Na, SHI Minjun, SHANG Zhiyuan, YUAN Yongna. Impacts of Total Energy Consumption Control and Energy Quota Allocation on China's Regional Economy Based on A 30-region Computable General Equilibrium Analysis[J]. Chinese Geographical Science, 2015, 25(6): 657-671. doi: 10.1007/s11769-015-0739-0

Citation:

LI Na, SHI Minjun, SHANG Zhiyuan, YUAN Yongna. Impacts of Total Energy Consumption Control and Energy Quota Allocation on China's Regional Economy Based on A 30-region Computable General Equilibrium Analysis[J]. Chinese Geographical Science, 2015, 25(6): 657-671. doi: 10.1007/s11769-015-0739-0

Impacts of Total Energy Consumption Control and Energy Quota Allocation on China's Regional Economy Based on A 30-region Computable General Equilibrium Analysis

doi: 10.1007/s11769-015-0739-0

LI Na^1,2,
SHI Minjun^{1,2
,},
SHANG Zhiyuan^1,2,
YUAN Yongna¹

1.
University of Chinese Academy of Sciences, Beijing 100049, China;
2.
Research Center on Fictitious Economy & Data Science, Chinese Academy of Sciences, Beijing 100190, China

Funds: Under the auspices of National Natural Science Foundation of China (No. 41101556, 71173212, 71203215)

More Information

Corresponding author: SHI Minjun. E-mail: mjshi1964@gmail.com
Received Date: 2014-05-06
Rev Recd Date: 2014-09-05
Publish Date: 2015-06-27

Abstract

This paper examined the impacts of the total energy consumption control policy and energy quota allocation plans on China's regional economy. This research analyzed the influences of different energy quota allocation plans with various weights of equity and efficiency, using a dynamic computable general equilibrium (CGE) model for 30 province-level administrative regions. The results show that the efficiency-first allocation plan costs the least but widens regional income gap, whereas the outcomes of equity-first allocation plan and intensity target-based allocation plan are similar and are both opposite to the efficiency-first allocation plan' outcome. The plan featuring a balance between efficiency and equity is more feasible, which can bring regional economic losses evenly and prevent massive interregional migration of energy-related industries. Furthermore, the effects of possible induced energy technology improvements in different energy quota allocation plans were studied. Induced energy technology improvements can add more feasibility to all allocation plans under the total energy consumption control policy. In the long term, if the policy of the total energy consumption control continues and more market-based tools are implemented to allocate energy quotas, the positive consequences of induced energy technology improvements will become much more obvious.

References

[1]	Bai Wanping, 2011. A study of the control of energy consumption, energy intensity and energy consumption structure for China in its 12th Five-Year period. Macroeconomics, (9): 93-98. (in Chinese)
[2]	Baumert K A, Bhandari R, Kete N, 1999. What Might a Developing Country Climate Commitment Look Like? Washington: WRI, 1-20.
[3]	Bohm P, Larsen B, 1994. Fairness in a tradable-permit treaty for carbon emissions reductions in Europe and the Former Soviet Union. Environmental and Resources Economics, 4(3): 219-239. doi: 10.1007/BF00692325
[4]	Bollen J, Gielen A and Timmer H, 1999. Clubs, ceilings and CDM: Macroeconomics of compliance with the Kyoto Protocol. The Energy Journal, Special Issue: The Costs of the Kyoto Protocol: A Multi-Model Evaluation, 20: 177-206. doi: 10. 5547/ISSN0195-6574-EJ-Vol20-NoSI-8
[5]	Burniaux J M, Nicolett G, and Oliveira-Martins J, 1992. Green: A global model for quantifying the cost of policies to curb CO₂ Emissions. Economic Studies, Special Issue: Costs of Reducing CO₂ Emissions, 19: 49-90.
[6]	Chen Wenying, Wu Zongxin, 1998. Carbon emission permit allocation and trading. Journal of Tsinghua University: Sci & Tech, 38(12): 15-18. (in Chinese)
[7]	Cramton P, Kerr S, 2002. Tradeable carbon permit auctions: How and why to auction not grandfather. Energy Policy, 30(4): 333-345. doi: 10.1016/S0301-4215(01)00100-8
[8]	Den Elzen M, Lucas P, Vuuren D, 2005. Abatement costs of post-Kyoto climate regimes. Energy Policy, 33(16): 2138-2151. doi: 10.1016/j.enpol.2004.04.012
[9]	Edwards T H, Hutton J P, 2001. Allocation of carbon permits within a country: A general equilibrium analysis of the United Kingdom. Energy Economics, 23(4): 371-386. doi: 10.1016/ S0140-9883(00)00077-3
[10]	Grubb M, 1989. The Greenhouse Effect: Negotiating Targets. London: Royal Institute of International Affairs, 7-34.
[11]	He Jiankun, Yu Zhiwei, Zhang Da, 2012. China's strategy for energy development and climate change mitigation. Energy Policy, 51: 7-13. doi: 10.1016/j.enpol.2012.03.084
[12]	Jaffe A B, Newell R G, Stavins R N, 2002. Environmental policy and technological change. Environmental and Resource Economics, 22(1-2): 41-70.
[13]	Janssen M, Rotmans J, 1995. Allocation of fossil CO₂ emission rights quantifying cultural perspectives. Ecological Economics, 13(1): 65-79. doi: 10.1016/0921-8009(94)00058-4
[14]	Jung C H, Krutilla K, Boyd R, 1996. Incentives for advanced pollution abatement technology at the industry level: An evaluation of policy alternatives. Economics and Management, 30(1): 95-111. doi: 10.1006/jeem.1996.0007
[15]	Kerr S, Newell R G, 2003. Policy-induced technology adoption: Evidence from the U.S. Lead Phasedown. The Journal of Industrial Economics, 51(3): 317-343. doi: 10.1111/1467-6451.00203
[16]	Landjouw J O, Mody A, 1996. Innovation and international diffusion of environmentally responsive technology. Research Policy, 25 (4): 549-571. doi: 10.1016/0048-7333(95)00853-5
[17]	Li Guoping, Yuan Yuan, 2014. Impact of regional development on carbon emission: empirical evidence across countries. Chinese Geographical Science, 24(5): 499-510. doi: 10.1007/s 11769-014-0710-5
[18]	Li Na, Shi Minjun, Wang Fei, 2009. Roles of regional differences and linkages on Chinese regional policy effect: Based on an eight-region CGE model for China. Systems Engineering-Theory & Practice, (10): 35-44. (in Chinese)
[19]	Li Na, Shi Minjun, Yuan Yongna, 2010. Impacts of carbon tax policy on regional development in China: A dynamic simulation based on China multi-regional CGE model. Acta Geographica Sinica, 65(12): 1572-1584. (in Chinese)
[20]	Li Shantong, He Jianwu, 2010. Computable General Equilibrium Model for China and Its Application. Beijing: Economic Science Press. (in Chinese)
[21]	Li S, He J, 2011. Impact of China's domestic carbon emission trading scheme. The 19th International Input Output Conference, June, Alexandria Virginia, USA.
[22]	NBSC (National Bureau of Statistics of China), 2008. China Energy Statistical Year Book 2008. Beijing: China Statistics Press. (in Chinese)
[23]	NBSC (National Bureau of Statistics of China), 2011. China Statistical Year Book 2011. Beijing: China Statistics Press. (in Chinese)
[24]	Newell R G, Jaffe A B, Stavins R N, 1999. The induced innovation hypothesis and energy-saving technological change. The Quarterly Journal of Economics, 114(3): 941-975. doi: 10. 1162/003355399556188
[25]	Popp D, 2002. Induced innovation and energy price. American Economic Review, 92(1): 339-349. doi: 10.3386/w8284
[26]	Requate T, 2005. Dynamic incentives by environmental policy instruments: A survey. Ecological Economics, 54(2): 175-195. doi: 10.1016/j.ecolecon.2004.12.028
[27]	RGGI (Regional Greenhouse Gas Initiative), 2007. Overview of RGGI CO₂ Budget Trading Program. Available at: http:// rggi.org/docs/program_summary_10_07.pdf. 2007-10-10.
[28]	Shi Minjun, Zhou Shenglv, 2010. The impact of low carbon technology development on China's CO₂ emission reduction. Management Review, 22(6): 48-53. (in Chinese)
[29]	Shi Minjun, Zhang Zhuoying, 2012. The Construction of China Interregional Input Output Model 2007. Beijing: Research Centre on Fictitious Economy & Data Science, Chinese Academy of Sciences. (in Chinese)
[30]	Sun Zuoren, Zhou Dequn, Zhou Peng et al., 2012. Quota allocation of China's energy conservation based on environmental ZSG-DEA. Systems Engineering, 30(1): 84-90. (in Chinese)
[31]	The State Council (The State Council of the People's Republic of China), 2011a. The Twelfth Five-year Plan for National Economic and Social Development of the People's Republic of China. Available at: http://www.gov.cn/2011lh/content_ 1825838_2.htm. 2011-12-20. (in Chinese)
[32]	The State Council (The State Council of the People's Republic of China), 2011b. Regional Energy Saving Targets of the Twelfth Five-year Plan Period. Available at: http://www.gov.cn/zwgk/ 2011-09/07/content_1941731.htm. 2011-09-07. (in Chinese)
[33]	The State Council (The State Council of the People's Republic of China), 2013. The Twelfth Five-year Plan of Energy Development (2011-2015). Available at: http://www.gov.cn/zwgk/ 2013-01/23/content_2318554.htm. 2013-01-23. (in Chinese)
[34]	Wang J, Cai B, Cao D et al., 2011. Scenario study on regional allocation of CO₂ emissions allowance in China. Acta Scientiae Circumstantiae, 31(4): 680-685. (in Chinese)
[35]	Wang Zheng, Wu Jing, Zhu Yongbin et al., 2010. The Research of Economics for Climate Protection. Beijing: Science Press, 134-147. (in Chinese)
[36]	Wu Yajun, Xuan Xiaowei, 2002. The Theory of Environmental Tax and Its Application in China. Beijing: Economic Science Press. (in Chinese)
[37]	Yuan Yongna, Shi Minjun, Li Na et al., 2012. Intensity allocation criteria of carbon emission permits and China's regional development: Based on a 30-province/autonomous region computable equilibrium model analysis. Advances in Climate Change Research, 8(1): 60-67. (in Chinese)
[38]	Zhao Rongqin Huang Xianjin, Liu Ying et al., 2014. Carbon emission of regional land use and its decomposition analysis: case study of Nanjing City, China. Chinese Geographical Science, 24(2): 198-212. doi: 10.1007/s11769-014-0714-1

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通讯作者: 陈斌, bchen63@163.com

1.
沈阳化工大学材料科学与工程学院沈阳 110142

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Impacts of Total Energy Consumption Control and Energy Quota Allocation on China's Regional Economy Based on A 30-region Computable General Equilibrium Analysis

1. University of Chinese Academy of Sciences, Beijing 100049, China;

2. Research Center on Fictitious Economy & Data Science, Chinese Academy of Sciences, Beijing 100190, China

Funds: Under the auspices of National Natural Science Foundation of China (No. 41101556, 71173212, 71203215)

Corresponding author: SHI Minjun. E-mail: mjshi1964@gmail.com

Received Date: 2014-05-06

Rev Recd Date: 2014-09-05

Publish Date: 2015-06-27

Key words:

total energy consumption control /
energy quota allocation /
computable general equilibrium (CGE) model /
induced energy technology improvements

Abstract: This paper examined the impacts of the total energy consumption control policy and energy quota allocation plans on China's regional economy. This research analyzed the influences of different energy quota allocation plans with various weights of equity and efficiency, using a dynamic computable general equilibrium (CGE) model for 30 province-level administrative regions. The results show that the efficiency-first allocation plan costs the least but widens regional income gap, whereas the outcomes of equity-first allocation plan and intensity target-based allocation plan are similar and are both opposite to the efficiency-first allocation plan' outcome. The plan featuring a balance between efficiency and equity is more feasible, which can bring regional economic losses evenly and prevent massive interregional migration of energy-related industries. Furthermore, the effects of possible induced energy technology improvements in different energy quota allocation plans were studied. Induced energy technology improvements can add more feasibility to all allocation plans under the total energy consumption control policy. In the long term, if the policy of the total energy consumption control continues and more market-based tools are implemented to allocate energy quotas, the positive consequences of induced energy technology improvements will become much more obvious.

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Reference (38)

[1]	Bai Wanping, 2011. A study of the control of energy consumption, energy intensity and energy consumption structure for China in its 12th Five-Year period. Macroeconomics, (9): 93-98. (in Chinese)
[2]	Baumert K A, Bhandari R, Kete N, 1999. What Might a Developing Country Climate Commitment Look Like? Washington: WRI, 1-20.
[3]	Bohm P, Larsen B, 1994. Fairness in a tradable-permit treaty for carbon emissions reductions in Europe and the Former Soviet Union. Environmental and Resources Economics, 4(3): 219-239. doi: 10.1007/BF00692325
[4]	Bollen J, Gielen A and Timmer H, 1999. Clubs, ceilings and CDM: Macroeconomics of compliance with the Kyoto Protocol. The Energy Journal, Special Issue: The Costs of the Kyoto Protocol: A Multi-Model Evaluation, 20: 177-206. doi: 10. 5547/ISSN0195-6574-EJ-Vol20-NoSI-8
[5]	Burniaux J M, Nicolett G, and Oliveira-Martins J, 1992. Green: A global model for quantifying the cost of policies to curb CO₂ Emissions. Economic Studies, Special Issue: Costs of Reducing CO₂ Emissions, 19: 49-90.
[6]	Chen Wenying, Wu Zongxin, 1998. Carbon emission permit allocation and trading. Journal of Tsinghua University: Sci & Tech, 38(12): 15-18. (in Chinese)
[7]	Cramton P, Kerr S, 2002. Tradeable carbon permit auctions: How and why to auction not grandfather. Energy Policy, 30(4): 333-345. doi: 10.1016/S0301-4215(01)00100-8
[8]	Den Elzen M, Lucas P, Vuuren D, 2005. Abatement costs of post-Kyoto climate regimes. Energy Policy, 33(16): 2138-2151. doi: 10.1016/j.enpol.2004.04.012
[9]	Edwards T H, Hutton J P, 2001. Allocation of carbon permits within a country: A general equilibrium analysis of the United Kingdom. Energy Economics, 23(4): 371-386. doi: 10.1016/ S0140-9883(00)00077-3
[10]	Grubb M, 1989. The Greenhouse Effect: Negotiating Targets. London: Royal Institute of International Affairs, 7-34.
[11]	He Jiankun, Yu Zhiwei, Zhang Da, 2012. China's strategy for energy development and climate change mitigation. Energy Policy, 51: 7-13. doi: 10.1016/j.enpol.2012.03.084
[12]	Jaffe A B, Newell R G, Stavins R N, 2002. Environmental policy and technological change. Environmental and Resource Economics, 22(1-2): 41-70.
[13]	Janssen M, Rotmans J, 1995. Allocation of fossil CO₂ emission rights quantifying cultural perspectives. Ecological Economics, 13(1): 65-79. doi: 10.1016/0921-8009(94)00058-4
[14]	Jung C H, Krutilla K, Boyd R, 1996. Incentives for advanced pollution abatement technology at the industry level: An evaluation of policy alternatives. Economics and Management, 30(1): 95-111. doi: 10.1006/jeem.1996.0007
[15]	Kerr S, Newell R G, 2003. Policy-induced technology adoption: Evidence from the U.S. Lead Phasedown. The Journal of Industrial Economics, 51(3): 317-343. doi: 10.1111/1467-6451.00203
[16]	Landjouw J O, Mody A, 1996. Innovation and international diffusion of environmentally responsive technology. Research Policy, 25 (4): 549-571. doi: 10.1016/0048-7333(95)00853-5
[17]	Li Guoping, Yuan Yuan, 2014. Impact of regional development on carbon emission: empirical evidence across countries. Chinese Geographical Science, 24(5): 499-510. doi: 10.1007/s 11769-014-0710-5
[18]	Li Na, Shi Minjun, Wang Fei, 2009. Roles of regional differences and linkages on Chinese regional policy effect: Based on an eight-region CGE model for China. Systems Engineering-Theory & Practice, (10): 35-44. (in Chinese)
[19]	Li Na, Shi Minjun, Yuan Yongna, 2010. Impacts of carbon tax policy on regional development in China: A dynamic simulation based on China multi-regional CGE model. Acta Geographica Sinica, 65(12): 1572-1584. (in Chinese)
[20]	Li Shantong, He Jianwu, 2010. Computable General Equilibrium Model for China and Its Application. Beijing: Economic Science Press. (in Chinese)
[21]	Li S, He J, 2011. Impact of China's domestic carbon emission trading scheme. The 19th International Input Output Conference, June, Alexandria Virginia, USA.
[22]	NBSC (National Bureau of Statistics of China), 2008. China Energy Statistical Year Book 2008. Beijing: China Statistics Press. (in Chinese)
[23]	NBSC (National Bureau of Statistics of China), 2011. China Statistical Year Book 2011. Beijing: China Statistics Press. (in Chinese)
[24]	Newell R G, Jaffe A B, Stavins R N, 1999. The induced innovation hypothesis and energy-saving technological change. The Quarterly Journal of Economics, 114(3): 941-975. doi: 10. 1162/003355399556188
[25]	Popp D, 2002. Induced innovation and energy price. American Economic Review, 92(1): 339-349. doi: 10.3386/w8284
[26]	Requate T, 2005. Dynamic incentives by environmental policy instruments: A survey. Ecological Economics, 54(2): 175-195. doi: 10.1016/j.ecolecon.2004.12.028
[27]	RGGI (Regional Greenhouse Gas Initiative), 2007. Overview of RGGI CO₂ Budget Trading Program. Available at: http:// rggi.org/docs/program_summary_10_07.pdf. 2007-10-10.
[28]	Shi Minjun, Zhou Shenglv, 2010. The impact of low carbon technology development on China's CO₂ emission reduction. Management Review, 22(6): 48-53. (in Chinese)
[29]	Shi Minjun, Zhang Zhuoying, 2012. The Construction of China Interregional Input Output Model 2007. Beijing: Research Centre on Fictitious Economy & Data Science, Chinese Academy of Sciences. (in Chinese)
[30]	Sun Zuoren, Zhou Dequn, Zhou Peng et al., 2012. Quota allocation of China's energy conservation based on environmental ZSG-DEA. Systems Engineering, 30(1): 84-90. (in Chinese)
[31]	The State Council (The State Council of the People's Republic of China), 2011a. The Twelfth Five-year Plan for National Economic and Social Development of the People's Republic of China. Available at: http://www.gov.cn/2011lh/content_ 1825838_2.htm. 2011-12-20. (in Chinese)
[32]	The State Council (The State Council of the People's Republic of China), 2011b. Regional Energy Saving Targets of the Twelfth Five-year Plan Period. Available at: http://www.gov.cn/zwgk/ 2011-09/07/content_1941731.htm. 2011-09-07. (in Chinese)
[33]	The State Council (The State Council of the People's Republic of China), 2013. The Twelfth Five-year Plan of Energy Development (2011-2015). Available at: http://www.gov.cn/zwgk/ 2013-01/23/content_2318554.htm. 2013-01-23. (in Chinese)
[34]	Wang J, Cai B, Cao D et al., 2011. Scenario study on regional allocation of CO₂ emissions allowance in China. Acta Scientiae Circumstantiae, 31(4): 680-685. (in Chinese)
[35]	Wang Zheng, Wu Jing, Zhu Yongbin et al., 2010. The Research of Economics for Climate Protection. Beijing: Science Press, 134-147. (in Chinese)
[36]	Wu Yajun, Xuan Xiaowei, 2002. The Theory of Environmental Tax and Its Application in China. Beijing: Economic Science Press. (in Chinese)
[37]	Yuan Yongna, Shi Minjun, Li Na et al., 2012. Intensity allocation criteria of carbon emission permits and China's regional development: Based on a 30-province/autonomous region computable equilibrium model analysis. Advances in Climate Change Research, 8(1): 60-67. (in Chinese)
[38]	Zhao Rongqin Huang Xianjin, Liu Ying et al., 2014. Carbon emission of regional land use and its decomposition analysis: case study of Nanjing City, China. Chinese Geographical Science, 24(2): 198-212. doi: 10.1007/s11769-014-0714-1

Impacts of Total Energy Consumption Control and Energy Quota Allocation on China's Regional Economy Based on A 30-region Computable General Equilibrium Analysis

doi: 10.1007/s11769-015-0739-0

Abstract

References

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通讯作者: 陈斌, bchen63@163.com

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