Analysis of the Financing Structure of China’s Listed New Energy Companies under the Goal of Peak CO2 Emissions and Carbon Neutrality

Abstract

Under China’s “Dual Carbon” strategic goal, electric energy substitution on the energy consumption side and clean substitution on the energy supply side have become an important path to achieve peak CO2 emissions and carbon neutrality. Adjusting the energy structure and encouraging new energy to replace traditional energy is an important manifestation of China’s energy supply revolution. Therefore, China’s new energy companies have grown rapidly over the past decade. The development and growth of this industry is inseparable from government policy support. The profitability and economy are essential for the new energy industry to support its sustainable development., especially the choice of business models such as operation model and financing structures. Therefore, we build extended panel vector autoregression (PVAR) models with two-step system GMM(SYS-GMM) estimator which introduced predetermined and strictly exogenous variables to explore the dynamic correlation between financing structure and economic performance of China’s new energy public companies. The number of patent approvals and financial leverage are introduced as exogenous control variables. The results show that although the increase in costs caused by financing behavior will have a negative impact on the company’s return on equity in the short term, with the rational investment and utilization of funds, the negative impact will gradually weaken. Listed new energy companies can effectively use financing funds, and the use of different financing tools has different effects on company performance. Although debt financing can help promote the company’s profitability, it is detrimental to its future growth capacity.