Marine fuel restrictions and air pollution: A study on Chinese ports considering transboundary spillovers

Abstract

Docked vessels in ports can be one of the dirtiest emitters in terms of local air pollutants. This paper evaluates whether the regulation of Emission Control Areas in China reduces air pollutants emissions in port cities. The transboundary spillovers of air pollution, induced by meteorological conditions, results in air pollution concentrations at specific locations encompassing both locally generated pollutants and those originating from elsewhere. Therefore, it is challenging to discern the emission reduction effects of environmental regulatory policies through air pollutant monitoring concentrations. This paper develops an approach to isolate transboundary spillovers induced by the wind, estimate locally produced pollution, and utilize the concentrations of locally produced pollution to identify the treatment effects of the Chinese Emission Control Areas policy. The results find that the policy has significantly reduced the locally produced sulfur dioxide concentrations by 3.41% in port cities. However, the omission of transboundary spillovers could yield contrasting results, suggesting that ignoring the pollution transport could lead to erroneous conclusions. The research findings of this study hold significant policy implications, highlighting the importance of accounting for transboundary transport of air pollution in evaluating the local government’s environmental efforts and implementing supra-city environmental policies to prevent air pollution.