IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v13y2020i1p169-d468743.html
   My bibliography  Save this article

Subsidies, Clean Heating Choices, and Policy Costs: Evidence from Rural Households in Northern China

Author

Listed:
  • Jing Li

    (Business School, Beijing Normal University, Beijing 100875, China)

  • Lingling Song

    (Chinese Academy of Environmental Planning, Beijing 100012, China)

  • Yanchun Zhu

    (Business School, Beijing Normal University, Beijing 100875, China)

Abstract

Clean heating renovation is important for optimizing the regional energy structure and improving the quality of the atmospheric environment in Northern China. According to survey data of 1298 rural households in the “coal-to-gas” reform in Hengshui of Hebei Province, in this paper, we construct a clean heating subsidy model which focuses on clean heating choices, the reburning rate, and the subsidy cost. The key parameters affecting farmers’ choice of clean heating, including the lifeline, classification of rural households, and gas price elasticity, are estimated. Furthermore, we simulate changes between the existing and new subsidy policies, including the impact on the welfare of rural residents. We present the following findings: (1) under the current subsidy standard, the level of gas heating lifeline in Hengshui is 700 m 3 , the proportion of low-gas-consumption households is approximately 47.38%, and the reburning rate ranges from 47.38% to 63.80%; (2) under a new subsidy standard which we designed to ensure that households will not reburn the coal, the optimal subsidy value is 1.23 CNY/m 3 , the optimal subsidy volume is 970 m 3 , and the total subsidy demonstrates an increase of 46.21%; and (3) the government’s subsidy standards should focus on low-income households.

Suggested Citation

  • Jing Li & Lingling Song & Yanchun Zhu, 2020. "Subsidies, Clean Heating Choices, and Policy Costs: Evidence from Rural Households in Northern China," Sustainability, MDPI, vol. 13(1), pages 1-18, December.
    • Handle: RePEc:gam:jsusta:v:13:y:2020:i:1:p:169-:d:468743
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/13/1/169/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/13/1/169/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Breton, Michèle & Mirzapour, Hossein, 2016. "Welfare implication of reforming energy consumption subsidies," Energy Policy, Elsevier, vol. 98(C), pages 232-240.
    2. Sun, Chuanwang & Ouyang, Xiaoling, 2016. "Price and expenditure elasticities of residential energy demand during urbanization: An empirical analysis based on the household-level survey data in China," Energy Policy, Elsevier, vol. 88(C), pages 56-63.
    3. Alberini, Anna & Gans, Will & Velez-Lopez, Daniel, 2011. "Residential Consumption of Gas and Electricity in the U.S.: The Role of Prices and Income," Sustainable Development Papers 99637, Fondazione Eni Enrico Mattei (FEEM).
    4. Meier, Helena & Rehdanz, Katrin, 2010. "Determinants of residential space heating expenditures in Great Britain," Energy Economics, Elsevier, vol. 32(5), pages 949-959, September.
    5. Matar, Walid & Anwer, Murad, 2017. "Jointly reforming the prices of industrial fuels and residential electricity in Saudi Arabia," Energy Policy, Elsevier, vol. 109(C), pages 747-756.
    6. Gong, Yuanchao & Cai, Bo-feng & Sun, Yan, 2020. "Perceived fiscal subsidy predicts rural residential acceptance of clean heating: Evidence from an indoor-survey in a pilot city in China," Energy Policy, Elsevier, vol. 144(C).
    7. Lin, Boqiang & Kuang, Yunming, 2020. "Natural gas subsidies in the industrial sector in China: National and regional perspectives," Applied Energy, Elsevier, vol. 260(C).
    8. Zhang, Yi & Ji, Qiang & Fan, Ying, 2018. "The price and income elasticity of China's natural gas demand: A multi-sectoral perspective," Energy Policy, Elsevier, vol. 113(C), pages 332-341.
    9. Brent, Daniel A. & Ward, Michael B., 2019. "Price perceptions in water demand," Journal of Environmental Economics and Management, Elsevier, vol. 98(C).
    10. Alberini, Anna & Gans, Will & Velez-Lopez, Daniel, 2011. "Residential consumption of gas and electricity in the U.S.: The role of prices and income," Energy Economics, Elsevier, vol. 33(5), pages 870-881, September.
    11. Christopher Barrington-Leigh & Jill Baumgartner & Ellison Carter & Brian E. Robinson & Shu Tao & Yuanxun Zhang, 2019. "An evaluation of air quality, home heating and well-being under Beijing’s programme to eliminate household coal use," Nature Energy, Nature, vol. 4(5), pages 416-423, May.
    12. Lin, Boqiang & Kuang, Yunming, 2020. "Household heterogeneity impact of removing energy subsidies in China: Direct and indirect effect," Energy Policy, Elsevier, vol. 147(C).
    13. Xu, Shuo & Ge, Jianping, 2020. "Sustainable shifting from coal to gas in North China: An analysis of resident satisfaction," Energy Policy, Elsevier, vol. 138(C).
    14. Zhao, Jing & Duan, Yaoqi & Liu, Xiaojuan, 2019. "Study on the policy of replacing coal-fired boilers with gas-fired boilers for central heating based on the 3E system and the TOPSIS method: A case in Tianjin, China," Energy, Elsevier, vol. 189(C).
    15. Breisinger, Clemens & Mukashov, Askar & Raouf, Mariam & Wiebelt, Manfred, 2019. "Energy subsidy reform for growth and equity in Egypt: The approach matters," Energy Policy, Elsevier, vol. 129(C), pages 661-671.
    16. Jing Cao, Mun S. Ho, and Huifang Liang, 2016. "Household energy demand in Urban China: Accounting for regional prices and rapid income change," The Energy Journal, International Association for Energy Economics, vol. 0(China Spe).
    17. Moerenhout, Tom S.H. & Sharma, Shruti & Urpelainen, Johannes, 2019. "Commercial and industrial consumers’ perspectives on electricity pricing reform: Evidence from India," Energy Policy, Elsevier, vol. 130(C), pages 162-171.
    18. Dube, Ikhupuleng, 2003. "Impact of energy subsidies on energy consumption and supply in Zimbabwe. Do the urban poor really benefit?," Energy Policy, Elsevier, vol. 31(15), pages 1635-1645, December.
    19. Hu, Wenhao & Ho, Mun S. & Cao, Jing, 2019. "Energy consumption of urban households in China," China Economic Review, Elsevier, vol. 58(C).
    20. Saboohi, Y., 2001. "An evaluation of the impact of reducing energy subsidies on living expenses of households," Energy Policy, Elsevier, vol. 29(3), pages 245-252, February.
    21. Yu, Yihua & Zheng, Xinye & Han, Yi, 2014. "On the demand for natural gas in urban China," Energy Policy, Elsevier, vol. 70(C), pages 57-63.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Luo, Xi & Gao, Yaru & Liu, Xiaojun & Sun, Yongkai & Li, Na & Liu, Jianghua, 2023. "ACHRA: A novel model to study the propagation of clean heating acceptance among rural residents based on social networks," Applied Energy, Elsevier, vol. 333(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kostakis, Ioannis & Lolos, Sarantis & Sardianou, Eleni, 2021. "Residential natural gas demand: Assessing the evidence from Greece using pseudo-panels, 2012–2019," Energy Economics, Elsevier, vol. 99(C).
    2. Xu, Shang & Zhang, Jun, 2023. "The welfare impacts of removing coal subsidies in rural China," Energy Economics, Elsevier, vol. 118(C).
    3. Favero, Filippo & Grossi, Luigi, 2023. "Analysis of individual natural gas consumption and price elasticity: Evidence from billing data in Italy," Energy Economics, Elsevier, vol. 118(C).
    4. Hu, Wenhao & Ho, Mun S. & Cao, Jing, 2019. "Energy consumption of urban households in China," China Economic Review, Elsevier, vol. 58(C).
    5. Lin, Boqiang & Kuang, Yunming, 2020. "Household heterogeneity impact of removing energy subsidies in China: Direct and indirect effect," Energy Policy, Elsevier, vol. 147(C).
    6. Kuang, Yunming & Lin, Boqiang, 2021. "Performance of tiered pricing policy for residential natural gas in China: Does the income effect matter?," Applied Energy, Elsevier, vol. 304(C).
    7. Wang, Banban & Wei, Jie & Tan, Xiujie & Su, Bin, 2021. "The sectorally heterogeneous and time-varying price elasticities of energy demand in China," Energy Economics, Elsevier, vol. 102(C).
    8. Malzi, Mohamed Jaouad & Sohag, Kazi & Vasbieva, Dinara G. & Ettahir, Aziz, 2020. "Environmental policy effectiveness on residential natural gas use in OECD countries," Resources Policy, Elsevier, vol. 66(C).
    9. Li, Lanlan & Gong, Chengzhu & Tian, Shizhong & Jiao, Jianling, 2016. "The peak-shaving efficiency analysis of natural gas time-of-use pricing for residential consumers: Evidence from multi-agent simulation," Energy, Elsevier, vol. 96(C), pages 48-58.
    10. Fan, Shengyue & Zha, Shuai & Zhao, Chenxi & Sizheng, Fangyuan & Li, Meihui, 2022. "Using energy vulnerability to measure distributive injustice in rural heating energy reform: A case study of natural gas replacing bulk coal for heating in Gaocheng District, Hebei Province, China," Ecological Economics, Elsevier, vol. 197(C).
    11. Dorothée Charlier & Sondès Kahouli, 2018. "Fuel poverty and residential energy demand: how fuel-poor households react to energy price fluctuations," Post-Print halshs-01957771, HAL.
    12. Zhang, Yi & Ji, Qiang & Fan, Ying, 2018. "The price and income elasticity of China's natural gas demand: A multi-sectoral perspective," Energy Policy, Elsevier, vol. 113(C), pages 332-341.
    13. Dorothée Charlier & Sondès Kahouli, 2019. "From Residential Energy Demand to Fuel Poverty: Income-induced Non-linearities in the Reactions of Households to Energy Price Fluctuations," The Energy Journal, , vol. 40(2), pages 101-138, March.
    14. Burke, Paul J. & Yang, Hewen, 2016. "The price and income elasticities of natural gas demand: International evidence," Energy Economics, Elsevier, vol. 59(C), pages 466-474.
    15. Gautam, Tej K. & Paudel, Krishna P., 2018. "The demand for natural gas in the Northeastern United States," Energy, Elsevier, vol. 158(C), pages 890-898.
    16. Hendrik Schmitz & Reinhard Madlener, 2020. "Heterogeneity in price responsiveness for residential space heating in Germany," Empirical Economics, Springer, vol. 59(5), pages 2255-2281, November.
    17. Helena Meier, Tooraj Jamasb, and Luis Orea, 2013. "Necessity or Luxury Good? Household Energy Spending and Income in Britain 1991-2007," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4).
    18. Li, Lanlan & Luo, Xuan & Zhou, Kaile & Xu, Tingting, 2018. "Evaluation of increasing block pricing for households' natural gas: A case study of Beijing, China," Energy, Elsevier, vol. 157(C), pages 162-172.
    19. Salomé Bakaloglou and Dorothée Charlier, 2019. "Energy Consumption in the French Residential Sector: How Much do Individual Preferences Matter?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    20. Anna Risch & Claire Salmon, 2017. "What matters in residential energy consumption: evidence from France," International Journal of Global Energy Issues, Inderscience Enterprises Ltd, vol. 40(1/2), pages 79-116.

    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:gam:jsusta:v:13:y:2020:i:1:p:169-:d:468743. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.