ABSTRACT
The mitigation of surging energy consumption and C02 emissions is an important topic in China’s sustainable development policy. In order to tackle these challenges and to promote a transition to a low-carbon economy, China’s central government adopted an ambitious policy package including the reduction of fossil fuels subsidies. The implementation of this policy package is expected to lead to the expansion of the renewable energy sector. In this chapter, we want to assess the socioeconomic and environmental impacts of these transformations and thus explore the co-benefits that may emerge from the complex interactions of energy, environment and economy systems. To perform this analysis, we compiled a hybrid physical input and monetary output model (HPIMO) with integrated sectors (electricity sector and six sectors of the rest of the economy, and for the sake of analyzing employment impacts, we further divided the electricity sectors into four sub-sectors) based on the Chinese 2007 national IO table and additional material and energy flow analysis (MEFA) and life-cycle analysis (LCA) data of sector-level energy mix inventories, emissions and employment. This system allowed us to analyze the interactions between the different sectors and to calculate the impacts on the whole supply-demand chains of the simulated energy subsidies reform and renewables sector expansion. These impacts were assessed in terms of employment (societal), saving on a budget (economic), C02 and air pollutants (SO2 and NOx) mitigation (environmental) effects. We developed and studied a business-as-usual scenario (no reform on fossil subsidies and a baseline renewable energy projection in 2007) as well as a fossil subsidies reform scenario and renewable energy scenarios in 2015. Our results highlighted that considerable co-benefits can be expected, including green employment generated by renewables industries, economic gains due to the reduction of subsidies on fossil fuels and mitigation on C02, SO2 and NOx. Based on the analytical results, we discuss implications for the further development of China’s sustainable energy policy. We hope our study will inform policymakers to better design low-carbon policies and promote a sustainable pathway for China.
