A green path towards sustainable development: The impact of low-carbon city pilot on energy transition

Abstract

With the increasing emphasis on sustainable development issues such as ensuring energy security, addressing climate change, and protecting the ecological environment, countries around the world have reached a general consensus to accelerate their energy transition (ET). In fact, China implemented a low-carbon city pilot (LCCP) policy in 2010 to explore green development and ET by reducing carbon dioxide (CO2) emissions and improving environmental quality. Using panel data for 253 cities at the prefecture level, this paper creatively divides the dimensions of ET into energy consumption (EC), energy structure (ES), and energy intensity (EI) from the supply-side and demand-side perspectives and measures the local and spatial spillover effects of LCCP on ET by employing a difference-in-differences (DID) model and a spatial difference-in-differences (SDID) model. The results indicate that LCCP accelerates ET, and the conclusions still hold after a series of robustness tests. Moreover, the results of the mechanism verification suggest that LCCP affects ET indirectly through total factor productivity (TFP), and its impact depends on the construction of public transportation (PT). Heterogeneity analysis of city location, size, and features reveals that LCCP is beneficial to ET in south cities, large cities, non-resource-based cities, and old industrial cities. We also find that LCCP generates positive spatial spillover effects on EC and EI and negative spatial spillover effects on ES in non-pilot cities.