Smart City Projects Boost Urban Energy Efficiency in China

Abstract

Policy makers around the world are turning to smart city projects in an effort to address the challenges of population growth, energy efficiency, and environmental sustainability. Previous studies have evaluated the effect of smart city projects on air quality. However, evidence on the impact of the projects on energy efficiency remains unclear. This study gathered prefecture-level city panel data in China, and used three strategies, namely a difference-in-differences estimator, a matching difference-in-differences estimator, and a counterfactual model using a machine learning algorithm, to assess the impact of smart city projects on energy efficiency. This study reported similar results across these strategies above. That is, after the introduction of a smart city project, energy efficiency had a remarkable and sizeable increase, ranging from 4 to 7 per cent. Moreover, this study shows that the effects of smart city projects increased over time. In addition, this study found that the effects varied according to the characteristics of the cities.