How Shale Gas will Shape China's Future? an Evaluation Based on Dynamic Energy-CGE Model

Abstract

The potential of shale gas development in China is huge but research that assesses the impacts of shale gas development on China's economy and carbon emissions are rare. This paper used a dynamic CGE model with energy and carbon emission modules to evaluate the impacts under different scenarios. The results implied that large scale of shale gas development will stimulate economy, when the supply of shale gas increases by 500% from 2010 to 2030, the GDP in 2030 will be 2.59% higher than BAU scenario; technology change that reduces the costs of shale gas utilization will not further stimulate economic growth on the basis of large scale exploitation, but will improve the diffusion of gas and make the energy structure cleaner therefore contribute the carbon mitigation. Hence, it is important for policy makers to take into account the varied effects of different shale gas promotion approaches.