Empowering more balanced energy futures: The role of the digital economy in alleviating China's energy trilemma at the city-level

Abstract

This study explores the influence of the Digital Economy (DE) on the Energy Trilemma (ET) across Chinese cities from 2008 to 2021. Leveraging an extensive panel dataset encompassing 276 cities, we constructed a city-level ET index, categorized cities using k-means clustering, and employed IV-GMM regression to scrutinize the impact of DE. Our findings reveal that DE is instrumental in tackling ET issues, with significant variations attributed to city-specific attributes, including centralized heating systems and the complexity of urban terrain. The mediation analysis pinpoints the optimization of industrial structures, technological progress, and the attraction of foreign investment as key conduits through which DE exerts its influence on ET. These insights highlight the pivotal role of DE as an essential instrument for bolstering sustainable energy frameworks. They also emphasize the necessity for city-specific digital economy policies to effectively address the unique ET challenges faced by each municipality. Additionally, the study underscores the positive influence of openness to foreign investment in the energy sector as a strategy for confronting ET challenges.