The Digital Economy and the Energy “Internal Circulation”: Evidence from China’s Interprovincial Energy Trade

In the context of the increasing instability and uncertainty of the world economy, China’s energy security is threatened. It is important to study how to build the energy “internal circulation” for China’s sustainable development. This paper measures the level of interprovincial energy trade and digital economy development in China through the gravity model estimation method and the entropy value method and examines the impact and mechanism of action of the digital economy on energy circulation. The findings are as follows: (1) Accelerating the development of the digital economy can significantly improve the level of energy “internal circulation” in China, which remains robust after endogeneity treatment and a series of robustness tests. (2) Digital economy has promoted the development of energy “internal circulation” from the production, distribution, exchange, and consumption of energy. (3) The higher the level of digital economy development, the more energy-rich regions and the central regions with a high degree of coupling and coordination between digital and energy systems, the more the digital economy contributes to the energy “internal circulation”. Therefore, it is proposed to accelerate the development of the digital economy, to pay attention to the in-depth integration of digital and energy, and to focus on the coordinated development of regions as effective ways to jointly promote the energy “internal circulation”.