Equity-based carbon neutral plan induces cross-regional coal leakage and industrial relocation

Ziqiao Zhou; Xiaotian Ma; Silu Zhang; Chaoyi Guo; Xiaorui Liu; Lin Zhang; Yang Xie

doi:10.1016/j.isci.2024.109079

Equity-based carbon neutral plan induces cross-regional coal leakage and industrial relocation

iScience. 2024 Feb 1;27(3):109079. doi: 10.1016/j.isci.2024.109079. eCollection 2024 Mar 15.

Authors

Ziqiao Zhou¹, Xiaotian Ma¹, Silu Zhang¹, Chaoyi Guo¹, Xiaorui Liu^{1

2}, Lin Zhang^{3

4}, Yang Xie^{5

6}

Affiliations

¹ College of Environmental Sciences and Engineering, Peking University, Beijing 100871, China.
² China Electric Power Research Institute, Beijing 100192, China.
³ School of Energy and Environment, City University of Hong Kong, Kowloon Tong, Hong Kong SAR.
⁴ Center for Ocean Research in Hong Kong and Macau, Hong Kong, Hong Kong SAR.
⁵ School of Economics and Management, Beihang University, Beijing 100191, China.
⁶ Laboratory for Low-carbon Intelligent Governance, Beihang University, Beijing 100191, China.

Abstract

China as a major coal-consuming economy faces the challenge of balancing economic development and carbon neutrality goal. This paper incorporates both efficiency-based and equity-based carbon neutrality policies into a numerical model to quantitatively assess how coal reduction under various carbon-neutral policies affects energy mix, economic growth, and industrial structures by 2060. Results show the nationwide coal intensity will ultimately plunge by over 95% from 2017 to 2060, mainly attributed to the coal-phasing-out in most industries. National Gross Domestic Product losses reaches 4,951 billion USD in efficiency-based scenarios by 2060, and the economic losses are even more severe in less developed provinces, especially provinces in Northern China. Although the equity-based policy can reduce the economic burden for the Northern China, the equity-based policy is accompanied by a significant regional shift in coal across the country: eastern coal-intense industries will be relocated northward, leading to increases in embodied coal consumption.

Keywords: Earth sciences; Energy Modeling; Energy management; Engineering.