IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v315y2025ics0360544225000027.html
   My bibliography  Save this article

Energy use rights trading and carbon emissions

Author

Listed:
  • Cheng, Zhen
  • Ding, Chante Jian
  • Zhao, Kunqian

Abstract

The Paid Use and Trading System for Energy Use Rights (PRTE) facilitates the efficient allocation of energy resources through market mechanisms, representing a crucial initiative to promote green development. The system is designed to optimize energy structures, reduce carbon emissions, and achieve balanced economic and environmental growth. Using data from 276 prefecture-level cities in China, this study treats PRTE implementation as a quasi-natural experiment and employs a difference-in-differences model to empirically assess the impact of PRTE on urban carbon emissions and its underlying mechanisms. The findings demonstrate that PRTE significantly reduces urban carbon emissions. This conclusion is robust, supported by various tests, including parallel trend tests, placebo tests, and instrumental variable methods. Mechanism analysis shows that PRTE drives urban carbon reduction by promoting industrial structure upgrades and technological innovation. Heterogeneity tests reveal that PRTE has a stronger inhibitory effect on carbon emissions in cities with higher degrees of fiscal decentralization, more advanced green financial development, resource-based economies, and higher levels of economic development. The study recommends expanding PRTE programs to encompass more industries and regions, while establishing transparent and efficient trading markets to ensure fair and sustainable policy implementation.

Suggested Citation

  • Cheng, Zhen & Ding, Chante Jian & Zhao, Kunqian, 2025. "Energy use rights trading and carbon emissions," Energy, Elsevier, vol. 315(C).
    • Handle: RePEc:eee:energy:v:315:y:2025:i:c:s0360544225000027
    DOI: 10.1016/j.energy.2025.134360
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544225000027
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.energy.2025.134360?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:energy:v:315:y:2025:i:c:s0360544225000027. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.