China’s Current Energy Policy: Dependencies and Contradictions

Abstract

Global warming and severe air pollution in China have necessitated a transition to a sustainable energy system that eschews coal-dominated energy production. The implementation of energy policies inevitably affects the behavior of enterprises at the micro level, which in turn affects their financial performance. The purpose of the study is to quantify the trends, patterns and contradictions in China’s energy policy, identify and predict meaningful indicators for strategic intentions in the context of economic decarbonisation. Correlation and regression analysis, modelling and forecasting of energy consumption and carbon emission indicators by sector were implemented. The study demonstrates the potential positive effect of a strategy to minimise carbon emissions in the commercial and public services sector in the context of energy policy implementation and decarbonisation on China’s economic growth. The results have potentially important policy implications for Chinese policymakers and business leaders and are needed to develop further tools to reduce electricity consumption in the government’s Provincial Energy Conservation Goal (BEST) program as indicators of its implementation effectiveness in different provinces of China.