Insights into the efficiency of China's green energy policies

Abstract

Given the global inclination of economies toward green solutions, the current study aims to explore the association between green energy transition, adjusted net saving, energy intensity, and carbon dioxide emission in China. To achieve this, a novel approach utilizing Wavelet analysis is employed to examine the dynamic association among these variables from 1979 to 2020. The analysis utilized continuous wavelet, wavelet coherence, and partial and multiple wavelet coherence techniques, offering a comprehensive understanding beyond the limitations of prior research by investigating the relationships over various time frames. The findings from the wavelet coherence analysis yielded intriguing insights, indicating that an increase in energy transition is likely to result in higher energy intensity and increased CO2 emissions. Surprisingly, the study observed a negative impact of adjusted savings on energy transition in the medium run, whereas in the long term, an increase in adjusted net savings was associated with higher carbon emissions in the Chinese economy. This highlights the intricate interplay between energy transition, adjusted savings, and environmental impacts, with different time scales playing a significant role in shaping these connections. Policymakers should carefully consider these dynamics to formulate effective strategies for sustainable development and carbon emission reduction in China. Furthermore, employing partial and multiple coherence analysis, the outcomes has demonstrated a strong interconnected correlations between energy intensity, green energy transition, CO2 emissions, and adjusted net savings across short-run, medium-run, and long-run time frequencies. Overall, the study concludes the positive link between energy and carbon emissions in China, while the effectiveness of the green energy transition remains vulnerable. The findings offer valuable insights for informed decision-making and policy implications, facilitating the adoption of appropriate measures to promote a greener and more sustainable future in China.