How to achieve China’s CO2 emission reduction targets by provincial efforts? – An analysis based on generalized Divisia index and dynamic scenario simulation

Abstract

China has set a series of periodical CO2 emission reduction targets, with a goal of peaking CO2 emission by 2030. Due to China’s large size and imbalanced development, the achievement of such targets depends on the performances of China’s provinces. Under such a circumstance, this study aims to identify the driving forces and predict the trajectories of China’s overall and provincial energy-related CO2 emissions. The generalized Divisia index decomposition analysis results show that investment sale expansion is the major driver of CO2 emission growth in China and most Chinese provinces, which is partly offset by the efficiency gains. Our dynamic scenario simulation results show that most Chinese provinces will achieve their CO2 intensity reduction targets but have difficulties in achieving their CO2 emission peak targets. Further integration of both efficiency and technology improvement is one effective approach toward peaking CO2 emissions. Provincial disparities exist, resulting in that different factors have different impacts in different Chinese provinces. Consequently, it is crucial to set up appropriate province-specific emission peak targets and raise province-specific emission reduction policies by considering the local realities.