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Adjusting productivity measures for CO2 emissions control: Evidence from the provincial thermal power sector in China

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  • Chen, Bin
  • Jin, Yingmei

Abstract

We examine productivity changes by the types of environmental regulations used to control CO2 emissions in the provincial, thermal power sector of China from 2009 to 2016. We derive a Törnqvist-type productivity index in which CO2 emissions are undesirable outputs. The shadow price of CO2, required for calculating the index, is estimated based on the duality between a revenue and a directional output distance function. Productivity changes are measured using both estimated shadow prices and the actual trading prices of CO2 in six pilot emissions trading systems. We find that productivity measurement is highly dependent on the choice of CO2 prices. We also investigate the impact of emission intensity and emissions per se on productivity measurement. We show that productivity measurement depends on the choice of environmental standard.

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  • Chen, Bin & Jin, Yingmei, 2020. "Adjusting productivity measures for CO2 emissions control: Evidence from the provincial thermal power sector in China," Energy Economics, Elsevier, vol. 87(C).
    • Handle: RePEc:eee:eneeco:v:87:y:2020:i:c:s0140988320300463
    DOI: 10.1016/j.eneco.2020.104707
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    8. Chen, Bin & Yan, Jun & Zhu, Xun & Liu, Yue, 2023. "The potential role of renewable power penetration in energy intensity reduction: Evidence from the Chinese provincial electricity sector," Energy Economics, Elsevier, vol. 127(PB).
    9. Miaomiao Tao & Pierre Failler & Lim Thye Goh & Wee Yeap Lau & Hanghang Dong & Liang Xie, 2022. "Quantify the Effect of China’s Emission Trading Scheme on Low-carbon Eco-efficiency: Evidence from China’s 283 Cities," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 27(6), pages 1-33, August.
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