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The Composite Impact of the Low-Carbon Development Policies in Beijing’s Urbanization: A Regional Dynamic CGE Modeling

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  • Fan, Mingtai
  • Wei, Taoyuan
  • Zhang, Xiaoguang
  • Zhang, Yumei

Abstract

The transition to a low-carbon economy, originated from the thinking on the energy future, climate change and sustainable development, has gained global momentum in recent decade. China in the industrialization and the urbanization process has to find an effective and inclusive strategy with policy mix for the low-carbon development. The research on the policies and planning for low-carbon development in China and as well Beijing is accordingly becoming a frontier of policy concerns. This report aims to highlight the offsetting and the synergy effects in terms of economic growth, energy consumption, and carbon emission by industry of policy pair by quantifying the impact of different low-carbon development policies. As supported by the GEF for the Second Beijing Environment Project, we take Beijing as a case to analyze counter-facturally the cost effective policy mix for low-carbon development in urbanization with a dynamic CGE model. This model is a SAM-based regional one, which follows the assumptions of energy consumption and CO2 emission by industries of the GRACE model by CICERO in Norway, the assumptions of commodity flows out-and-in of Beijing as depicted in the PRCGEM model by the IQTE Team at CASS. The policies in the designed scenarios include: (1) A flat increase in energy efficiency by industry; (2) An increase in investment in electricity industry; (3) A flat carbon tax by industry; (4) A policy pair, i.e a mix of carbon tax and investment subsidy for energy conservation and emission reduction to keep the governmental revenue neural. The conclusion is that the cost effective low-carbon development strategy should be one on the integrated application of practical policies.

Suggested Citation

  • Fan, Mingtai & Wei, Taoyuan & Zhang, Xiaoguang & Zhang, Yumei, 2013. "The Composite Impact of the Low-Carbon Development Policies in Beijing’s Urbanization: A Regional Dynamic CGE Modeling," Conference papers 332310, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332310
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