Is China’s Natural Gas Consumption Converging? Empirical Research Based on Spatial Econometrics

Abstract

Excessive regional differences in energy consumption have led to inequality and energy poverty. It is essential to clarify the factors of energy consumption convergence to solve this problem. We use the spatial convergence model to analyze the convergence characteristics and conditions of China’s natural gas consumption from 2005 to 2017. The results of spatial absolute convergence show that there is absolute convergence of natural gas consumption in China, and the economic competition among provinces slightly hinders the convergence. Furthermore, based on the spatial Durbin model and the spatial conditional convergence model, we found that insufficient pipe network construction and the price difference caused by provincial borders are the main factors hindering the flow of natural gas, which also restricts the spatial convergence of natural gas consumption. The development of the tertiary industry and the improvement of purchasing power will help accelerate the convergence of natural gas consumption. This research not only evaluates the spatial convergence of China’s natural gas consumption for the first time, but also provides an analytical idea for formulating policies to eliminate poverty in energy consumption.