IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v16y2024i23p10191-d1526347.html
   My bibliography  Save this article

Energy–Economy–Carbon Emissions: Impacts of Energy Infrastructure Investments in Pakistan Under the China–Pakistan Economic Corridor

Author

Listed:
  • Xiue Li

    (School of Economics and Management, China University of Petroleum, Qingdao 266580, China)

  • Zhirao Liu

    (School of Economics and Management, China University of Petroleum, Qingdao 266580, China)

  • Tariq Ali

    (School of Economics and Management, Jiangxi Agricultural University, Nanchang 340044, China)

Abstract

Energy–economy–environment sustainability is critical in shaping energy policies, especially in developing countries facing energy shortages. Investment in energy infrastructure, such as under the China–Pakistan Economic Corridor (CPEC), provides an opportunity to explore how such investments impact economic growth, environmental quality, and energy security. This study examines the energy, economic, and environmental effects of CPEC’s energy investments in Pakistan, covering a range of power sources, including coal, hydro, solar, wind, and nuclear energy. Utilizing data from 31 CPEC energy projects and employing the GTAP-E-Power model, this research assesses these impacts through seven scenarios, comprehensively analyzing the heterogeneity of different power sources. Our findings reveal that while all types of CPEC energy infrastructure investments contribute to increasing the share of zero-emissions electricity to 49.1% and reducing CO 2 emissions by 18.61 million tons, the economic impacts vary significantly by energy source. The study suggests that it is crucial to prioritize renewable energy investments while addressing immediate power shortages to balance economic growth with environmental sustainability. Policymakers should also consider the potential inter-sectoral substitution effects when applying significant shocks to specific sectors. This analysis informs future energy investment decisions under CPEC and offers insights for other Belt and Road Initiative (BRI) countries aiming to optimize their energy strategies for sustainable development.

Suggested Citation

  • Xiue Li & Zhirao Liu & Tariq Ali, 2024. "Energy–Economy–Carbon Emissions: Impacts of Energy Infrastructure Investments in Pakistan Under the China–Pakistan Economic Corridor," Sustainability, MDPI, vol. 16(23), pages 1-26, November.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:23:p:10191-:d:1526347
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/16/23/10191/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/16/23/10191/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Tao, Yiheng & Liang, Haiming & Celia, Michael A., 2020. "Electric power development associated with the Belt and Road Initiative and its carbon emissions implications," Applied Energy, Elsevier, vol. 267(C).
    2. Zhang, Zhuo & Zhao, Yongliang & Cai, Haiya & Ajaz, Tahseen, 2023. "Influence of renewable energy infrastructure, Chinese outward FDI, and technical efficiency on ecological sustainability in belt and road node economies," Renewable Energy, Elsevier, vol. 205(C), pages 608-616.
    3. Lin, Boqiang & Bae, Nuri & Bega, François, 2020. "China's Belt & Road Initiative nuclear export: Implications for energy cooperation," Energy Policy, Elsevier, vol. 142(C).
    4. Nong, Duy, 2020. "Development of the electricity-environmental policy CGE model (GTAP-E-PowerS): A case of the carbon tax in South Africa," Energy Policy, Elsevier, vol. 140(C).
    5. Schreiner, Lena & Madlener, Reinhard, 2021. "A pathway to green growth? Macroeconomic impacts of power grid infrastructure investments in Germany," Energy Policy, Elsevier, vol. 156(C).
    6. Wang, Mengjiao & Liu, Jianxu & Rahman, Sanzidur & Sun, Xiaoqi & Sriboonchitta, Songsak, 2023. "The effect of China’s outward foreign direct investment on carbon intensity of Belt and Road Initiative countries: A double-edged sword," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 792-808.
    7. Ahmed, Salik uddin & Ali, Amjad & Kumar, Dileep & Malik, Muhammad Zeeshan & Memon, Abdul Hameed, 2019. "China Pakistan Economic Corridor and Pakistan’s energy security: A meta-analytic review," Energy Policy, Elsevier, vol. 127(C), pages 147-154.
    8. Yuegang Song & Umer Shahzad & Sudharshan Reddy Paramati, 2023. "Impact of energy infrastructure investments on renewable electricity generation in major Asian developing economies," Australian Economic Papers, Wiley Blackwell, vol. 62(1), pages 1-23, March.
    9. Nong, Duy, 2018. "General equilibrium economy-wide impacts of the increased energy taxes in Vietnam," Energy Policy, Elsevier, vol. 123(C), pages 471-481.
    10. Liu, Haiyue & Wang, Yile & Jiang, Jie & Wu, Peng, 2020. "How green is the “Belt and Road Initiative”? – Evidence from Chinese OFDI in the energy sector," Energy Policy, Elsevier, vol. 145(C).
    11. Bega, François & Lin, Boqiang, 2023. "China's belt & road initiative energy cooperation: International assessment of the power projects," Energy, Elsevier, vol. 270(C).
    12. Ahmad, Hafsa & Jamil, Faisal, 2024. "Investigating power outages in Pakistan," Energy Policy, Elsevier, vol. 189(C).
    13. Nong, Duy & Simshauser, Paul & Nguyen, Duong Binh, 2021. "Greenhouse gas emissions vs CO2 emissions: Comparative analysis of a global carbon tax," Applied Energy, Elsevier, vol. 298(C).
    14. Li, Zhongshu & Gallagher, Kevin P. & Mauzerall, Denise L., 2020. "China's global power: Estimating Chinese foreign direct investment in the electric power sector," Energy Policy, Elsevier, vol. 136(C).
    15. Sijin Chen, & Ning Li,, 2024. "From carbon-intensive to mineral resources: Barriers and motivators for embracing natural resource in the transition process," Resources Policy, Elsevier, vol. 91(C).
    16. Bega, François & Lin, Boqiang, 2024. "China's Belt & Road Initiative hydropower cooperation: what can be improved?," Renewable Energy, Elsevier, vol. 221(C).
    Full references (including those not matched with items on IDEAS)

    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. Yanmei Li & Xiushan Bai, 2022. "How Can China and the Belt and Road Initiative Countries Work Together Responding to Climate Change: A Perspective on Carbon Emissions and Economic Spillover Effects," IJERPH, MDPI, vol. 19(15), pages 1-17, August.
    2. Lin, Boqiang & Bega, François, 2021. "China's Belt & Road Initiative coal power cooperation: Transitioning toward low-carbon development," Energy Policy, Elsevier, vol. 156(C).
    3. Nong, Duy & Nguyen, Duong Binh & Nguyen, Trung H. & Wang, Can & Siriwardana, Mahinda, 2020. "A stronger energy strategy for a new era of economic development in Vietnam: A quantitative assessment," Energy Policy, Elsevier, vol. 144(C).
    4. Jing Han & Weilin Zhu & Chaofan Chen, 2023. "Identifying Emissions Reduction Opportunities in International Bilateral Emissions Trading Systems to Achieve China’s Energy Sector NDCs," IJERPH, MDPI, vol. 20(2), pages 1-24, January.
    5. Bega, François & Lin, Boqiang, 2024. "China's Belt & Road Initiative hydropower cooperation: what can be improved?," Renewable Energy, Elsevier, vol. 221(C).
    6. Bega, François & Lin, Boqiang, 2023. "China's belt & road initiative energy cooperation: International assessment of the power projects," Energy, Elsevier, vol. 270(C).
    7. Schreiner, Lena & Madlener, Reinhard, 2022. "Investing in power grid infrastructure as a flexibility option: A DSGE assessment for Germany," Energy Economics, Elsevier, vol. 107(C).
    8. David Gattie & Michael Hewitt, 2023. "National Security as a Value-Added Proposition for Advanced Nuclear Reactors: A U.S. Focus," Energies, MDPI, vol. 16(17), pages 1-26, August.
    9. Kelly Sims Gallagher & Qi Qi, 2021. "Chinese Overseas Investment Policy: Implications for Climate Change," Global Policy, London School of Economics and Political Science, vol. 12(3), pages 260-272, May.
    10. Qizhen Wang & Rong Wang & Suxia Liu, 2024. "The reverse technology spillover effect of outward foreign direct investment, energy efficiency and carbon emissions," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(7), pages 17013-17035, July.
    11. Hugo Gaspar Hernandez-Palma & Dairo J. Novoa & Jorge Enrique Taboada à lvarez, 2024. "New Trends in Green Projects Aimed at Clean Energy: An Analysis of the Scientific Literature," International Journal of Energy Economics and Policy, Econjournals, vol. 14(6), pages 278-286, November.
    12. Salik Uddin Ahmed & Amjad Ali & Abdul Hameed Memon & Ahmad Hussain, 2021. "Policy framework for implementation of sustainable procurement practices in healthcare industry," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(3), pages 3929-3945, March.
    13. Jia, Zhijie & Lin, Boqiang, 2020. "Rethinking the choice of carbon tax and carbon trading in China," Technological Forecasting and Social Change, Elsevier, vol. 159(C).
    14. Chai, Li & Wang, Yuqi & Qi, Xiaohong, 2024. "Cross-category connectedness between Shanghai crude oil futures and Chinese stock markets related to the Belt and Road Initiative," The North American Journal of Economics and Finance, Elsevier, vol. 73(C).
    15. Zhang, Lixia & Sun, Huaping & Pu, Tianlong & Sun, Hui & Chen, Zhenling, 2024. "Do green finance and hi-tech innovation facilitate sustainable development? Evidence from the Yangtze River Economic Belt," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 1430-1442.
    16. Wang, Hui & Si, Ieongcheng & Chen, Zhihua, 2024. "Does the Belt and Road Initiative promote China and the countries along the route to reconstruct the global value chain? Evidence from value-added trade," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 63-83.
    17. Naomi Tan & John Harrison & Mark Howells, 2024. "Comparing Long-Term Power Sector Pathways in Viet Nam: A Simple Cost-Optimization Approach with OSeMOSYS," Energies, MDPI, vol. 17(23), pages 1-24, December.
    18. Huang, Ruting & Yao, Xin, 2023. "The role of power transmission infrastructure in income inequality: Fresh evidence from China," Energy Policy, Elsevier, vol. 177(C).
    19. Nguyen, Phuong Anh & Abbott, Malcolm & Nguyen, Thanh Loan T., 2019. "The development and cost of renewable energy resources in Vietnam," Utilities Policy, Elsevier, vol. 57(C), pages 59-66.
    20. Tong, Tong & Chen, Xiaoyue & Singh, Tarlok & Li, Bin, 2022. "Corporate governance and the outward foreign direct investment: Firm-level evidence from China," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 962-980.

    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:16:y:2024:i:23:p:10191-:d:1526347. 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.