Carbon Emission Reduction Strategies Research Articles

Dynamic decision and its complex dynamics analysis of low-carbon supply chain considering risk-aversion under carbon tax policy

This study establishes a low-carbon supply chain game model under the centralized decision situation and the decentralized decision situation considering the manufacturer risk-aversion behavior, and discusses the influence of the manufacturer risk-aversion behavior on the optimal decision, profit, coordination, and complex dynamics of the supply chain. We find that comparing with the risk-neutral decentralized decision, the increase of manufacturer’s risk tolerance attitude can narrow the gap between the supply chain profit and the centralized decision, but it will further reduce the carbon emission reduction level. The increase of risk tolerance of the manufacturer and carbon tax will narrow the stable region of the system. Under this situation, the manufacturer should carefully adjust parameters to prevent the system from losing stability, especially the adjustment parameters for carbon emission reduction level. When the system is in a chaotic state, the increase of carbon tax rate makes the system show more complex dynamic characteristics. Under the chaotic state, it is difficult for the manufacturer to make correct price decision and carbon emission reduction strategy for the next period, which damages its profit, but increases the profit of the retailer and the supply chain. Finally, the carbon emission reduction cost-sharing contract is proposed to improve the carbon emission reduction level and the supply chain efficiency, achieving Pareto improvement. The stability region of the system is larger than that in the centralized decision situation, but the increase of the cost sharing coefficient will reduce the stability of the system in the decentralized decision-making situation.

Integration of Multidisciplinary Methods to Better Understand Regional Carbon Emissions

The latest report by Working Group III of the Intergovernmental Panel on Climate Change stated that the average annual emissions of global greenhouse gases during 2010–2019 were at the highest level in human history. As the largest energy consumer and carbon emitter in the world, China has pledged to reach peak carbon emissions before 2030 and achieve carbon neutrality before 2060 by implementing strict policies and measures. Accurate monitoring and evaluation of regional CO2 emissions are fundamental in formulating carbon emission reduction strategies and conducting international verification. However, estimating CO2 emissions in key industries, cities, and regions is a complex task that involves multidisciplinary methods such as carbon accounting, carbon monitoring, numerical simulation, and remote sensing inversion.

Comparison and analysis of carbon emissions of traditional, prefabricated, and green material buildings in materialization stage

A Carbon Emission Emergy Factor (Em-CEF) accounting model was constructed by combining the carbon emission factor and emergy analysis methods. The Em-CEF model was used to calculate and compare the carbon emissions in the materialization stages of green material, prefabricated, and traditional buildings. The Em-CEF model can calculate the carbon emissions from building materials, machinery, and labor of traditional buildings, as well as from the new green building materials to solve the problem of an incomplete carbon emission factor database. The emergy phase diagram and index evaluation system were constructed to predict the sustainability of different buildings. The overall energy consumption of buildings was evaluated from the perspective of resource consumption. The Em-CEF model establishes an effective analysis method by combining emergy and carbon emission factors in the same system, improving evaluation result reliability. It was found from a case study that the Em-CEF model enabled better selection of carbon emission reduction strategies in the materialization stage; and the carbon emissions of prefabricated buildings were higher than those of traditional buildings. The sustainable development index of prefabricated structures was better than that of traditional and green material buildings and prefabricated structures were more conducive to reducing environmental load and promoting carbon emission reduction.

The optimal carbon emission reduction and advertising strategy with dynamic market share in the supply chain

PurposeAs the quality of the environment decreases, enterprises and consumers' awareness of environmental protection is constantly improving. More and more enterprises begin to increase their investment in carbon emission reduction and attract environmentally friendly consumers to buy low-carbon products through advertising. The purpose of this paper is to utilize a realistic differential game model to provide dynamic carbon emission reduction strategies, advertising strategies and cooperation methods for complex supply chain members from a long-term perspective.Design/methodology/approachThis paper uses the extend Vidale-Wolfe model (V-W model) to discuss the dynamic joint emission reduction strategy in the supply chain.Findings(1) When consumers' awareness of environmental protection increases, on the whole, carbon emission reduction and profit of products show an upward trend. (2) From a long-term perspective, the manufacturer's advertising subsidy to one of the retailers is the best choice. If the strength of the two retailers is unbalanced, the manufacturer will choose to cooperate with the dominant retailer. (3) Advertising, as a marketing means for retailers to promote low-carbon products, can alleviate the adverse effects of prisoner's dilemma in a semi-cooperative state, but it cannot achieve the Pareto optimization result.Research limitations/implicationsThis paper focuses on the analysis of the situation that when the manufacturer is the leader and thinks that consumers are active advocates of low-carbon products.Originality/valueThe results of this paper can provide theoretical basis for the joint emission strategy of supply chain members in low-carbon environment.

A comprehensive evaluation of the spatiotemporal variation of CO2 and its driving forces over China

With the improved accuracy and high spatiotemporal resolution, satellite remote sensing has provided an alternative way for monitoring the variations of CO2 in remote areas where field observations are inadequately sampled but the emissions of CO2 are increasing rapidly. Based on CO2 estimates from satellite remote sensing and the atmospheric tracer transport model, this study assessed the spatiotemporal patterns of atmospheric CO2 and its driving forces across China. Results show a consistent increase in CO2 at all levels of the troposphere, with the growth rate exceeding 2.1 ppm/year. Among them, the near surface witnessed obvious spatial heterogeneity with the highest concentrations of CO2 occurring in East China and the lowest in Northwest China. This strong spatial differentiation disappeared with increase in altitude and is replaced by a distinct south–north gradient difference at the upper troposphere. With regard to vertical variations, the concentration and growth rates of CO2 at the lower troposphere are generally higher than those at the upper troposphere. The driving mechanism analysis indicates that the variation of CO2 at the near surface is primarily caused by anthropogenic and biogenic activities, while air motion dominates the distribution of CO2 at the upper troposphere. The findings of the present study could provide a valuable reference for understanding regional carbon cycles and formulating carbon emission reduction strategies on a national scale.

Life Cycle Emissions of Passenger Vehicles in China: A Sensitivity Analysis of Multiple Influencing Factors

To reduce greenhouse gas emissions from passenger vehicles, new energy vehicles are actively promoted by China’s government. Various power system types are being developed and their sales keep increasing. However, there is uncertainty about the greenhouse gas emission of different vehicle types. This paper studies the life cycle carbon emissions of passenger vehicles in China. A calculation model is established with consideration of all types of power systems, model classes, and electric driving ranges. In order to calculate and compare the effect of carbon emission reduction on all types of vehicles, a sensitivity analysis is conducted in two ways to study three of the main influencing factors. The results show the carbon emission-reducing effect of different factors on different stages in the life cycle. It is known that different influencing factors have different effects on these stages. Since there is a variation in different vehicle types, the carbon reduction effect caused by these factors is different for these vehicle types. This paper describes a sensitivity analysis of three main influencing factors and puts forward relevant policy recommendations to reduce the carbon emissions of passenger cars during their life cycle based on these results. It is necessary to take the vehicle life cycle as a whole for carbon emission management. The conclusions of this paper can be used for vehicle manufacturers to decide the focus of technology research, and also have important reference significance for enterprises when making life cycle carbon reduction strategies for their products. It is also of certain value for China to formulate a medium- and long-term carbon emission reduction strategy for the passenger car industry.

Assessing freight structure and its effect on transport CO2 emissions: heterogeneous and mediating effect analysis.

Understanding the effect of freight structure (FS) on carbon dioxide (CO2) emissions is significant for policymakers in the transport sector. However, few studies have investigated fully how the freight structure influences transport CO2 emissions. In the paper, a comprehensive freight structure index is proposed to assess the freight structure in 16 provinces of China during 2005-2019. Then, the heterogeneous effect of the freight structure and other factors on CO2 emissions are quantified by the quantile regression model developed. The mediating effect between freight structure and CO2 emissions is further examined. And the panel causality test is used to explore the directions of causality among variables. The main results indicate that (1) the level of freight structure shows a distribution of increase from western and central regions to eastern regions in 16 provinces. (2) Freight structure has a positive effect on transport CO2 emissions, and its effect is significantly heterogeneous in all quantiles. (3) Freight structure has an indirect impact on CO2 emissions through the scale effect. (4) The bidirectional causality is confirmed between economic growth, industrial structure, and information and communication technology with carbon emissions. A unidirectional causality from CO2 emissions to freight structure is also found. Finally, some policy recommendations are proposed for sustainable transport development in China. The results facilitate the formulation of the regionally tailored carbon emission reduction strategy in the transport sector.

Carbon emission strategies for container handling equipment using the activity-based method: A case study of Ambarlı container port in Turkiye

One of the most important components of a port's sustainability is its environmental impact. Port operators are currently focusing on the sustainable development of ports to measure this environmental impact and determine the emissions inventory. To combat climate change globally, Turkiye envisages reduction of its greenhouse gas (GHG) emissions rate by 21% until 2030. In line with this target, container ports are also focusing on the sustainability of their environmental impact and determining their emissions inventory. This study aims to estimate the total carbon emissions produced by the container handling equipment (CHE) used in the container port operations and to plan the carbon emission reduction strategy as concerns the climate change adaptation policy. The Ambarlı container port, which handles approximately 30% of Turkiye's total container volume, has been chosen as the application area of this case study. Carbon emissions from CHE vehicles in the port were estimated using the activity-based method. The carbon emission value per TEU in 2021 is calculated as 0.011335 tCO2e/TEU. Carbon emission reduction scenarios were created at two-year intervals until 2030. It has been determined that the dominant contribution to carbon emission in the container port is provided by terminal tractors that consume diesel fuel.

Optimal financing strategy in a closed-loop supply chain for construction machinery remanufacturing with emissions abatement

<p style='text-indent:20px;'>Motivated by the remanufacturing practice of construction machinery, this paper examines the impacts of different cooperation financing and carbon emission reduction (CER) strategies on the operational decisions in a closed-loop supply chain (CLSC) where the original equipment manufacturer (OEM) produces only new products and the capital-constraint retailer produces remanufactured products and sells both new and remanufactured products to consumers. Based on the cooperation level between the OEM and the retailer, four different financing strategies, including the non-cooperation financing (NCF), the supply chain carbon financing (SCCF), the partial cooperation with delay-in-payment financing (PCD), and the full-cooperation financing (FC), are explored. Meanwhile, we extend the proposed models by considering the CER strategy implemented by the OEM, and then investigate its impact on the optimal operational and financing decisions of the retailer. The results show that: i) Under different financing strategies, the CER strategy has no impact on the retail price of remanufactured products, but can help increase the market share of new products and strengthen the market value effect for the OEM. ii) Compared with the scenario without CER, the SCCF strategy can not only ease funding pressure than the NCF strategy for the retailer but also increase the CLSC profit under the CER strategy. iii) No matter which financing strategy is adopted, the CER strategy always has a squeezing effect on the market size of remanufactured products, i.e., the cannibalization effect. iv) The CER strategy is not conducive to the development of the remanufacturing industry, but can improve the environmental performance in terms of reducing emissions and increasing the market sales for new products.</p>

Research on Spatial and Temporal Pattern Evolution and Driving Factors of County Carbon Emissions in Underdeveloped Regions: Gansu Province of Western China as an Example

This paper used the Gini coefficient, standard deviation ellipse, and spatial autocorrelation model to analyze the overall changes, regional differences, spatio-temporal evolution pattern, and clustering characteristics of carbon emissions in 87 counties in Gansu Province from 1997 to 2017, based on which driving factors of carbon emissions were detected using the geographic detector model, so as to provide a reference for promoting low-carbon green development and ecological civilization construction in Gansu Province. The empirical research results found that county carbon emissions in Gansu Province showed a “first urgent and then slow” upward trend, and the difference in carbon emissions level has a slightly decreasing trend, and there are significant regional differences. Compared with other regions, the difference in county carbon emissions level in the Longzhong region has a smaller decline. Meanwhile, the county carbon emissions show spatial differentiation characteristics “medium-high and low-outside,” among which the carbon emissions in areas with better economic foundations are much higher than those in other areas, and the spatial polarization effect is obvious. In addition, there is a significant spatial positive correlation between county carbon emissions. The counties with high-high clusters are relatively stable, mainly concentrated in the Longzhong region, while counties with low-low clusters are slightly reduced, mainly concentrated in the southern ethnic region and the Longdongnan region, and the county carbon emission clusters type has a spatial locking effect. This is mainly due to the large differences in economic scale, industrial structure, and population size in Gansu Province, and the interaction between economic scale and other factors has a more significant impact on the spatial differentiation of carbon emissions. Moreover, the leading influencing factors of county carbon emission differences also have regional differences. Therefore, differentiated and targeted carbon emission reduction strategies need to be implemented urgently. Due to the lack of real county energy consumption statistics, the research results need to be further tested for robustness.

Estimation of Atmospheric Fossil Fuel CO2 Traced by Δ14C: Current Status and Outlook

Fossil fuel carbon dioxide (FFCO2) is a major source of atmospheric greenhouse gases that result in global climate change. Quantification of the atmospheric concentrations and emissions of FFCO2 is of vital importance to understand its environmental process and to formulate and evaluate the efficiency of carbon emission reduction strategies. Focusing on this topic, we summarized the state-of-the-art method to trace FFCO2 using radiocarbon (14C), and reviewed the 14CO2 measurements and the calculated FFCO2 concentrations conducted in the last two decades. With the mapped-out spatial distribution of 14CO2 values, the typical regional distribution patterns and their driving factors are discussed. The global distribution of FFCO2 concentrations is also presented, and the datasets are far fewer than 14CO2 measurements. With the combination of 14C measurements and atmospheric transport models, the FFCO2 concentration and its cross-regional transport can be well interpreted. Recent progress in inverse methods can further constrain emission inventories well, providing an independent verification method for emission control strategies. This article reviewed the latest developments in the estimation of FFCO2 and discussed the urgent requirements for the control of FFCO2 according to the current situation of climate change.

Equity-Aware Decarbonization of Residential Heating Systems

Most buildings still rely on fossil energy --- such as oil, coal and natural gas --- for heating. This is because they are readily available and have higher heat value than their cleaner counterparts. However, these primary sources of energy are also high pollutants. As the grid moves towards eliminating CO 2 emission, replacing these sources of energy with cleaner alternatives is imperative. Electric heat pumps --- an alternative and cleaner heating technology --- have been proposed as a viable replacement. In this paper, we conduct a data-driven optimization study to analyze the potential of reducing carbon emission by replacing gas-based heating with electric heat pumps 1 . We do so while enforcing equity in such transition. We begin by conducting an in-depth analysis into the energy patterns and demographic profiles of buildings. Our analysis reveals a huge disparity between lower and higher income households. We show that the energy usage intensity for lower income homes is 24% higher than higher income homes. Next, we analyze the potential for carbon emission reduction by transitioning gas-based heating systems to electric heat pumps for an entire city. We then propose equity-aware transition strategies for selecting a subset of customers for heat pump-based retrofits which embed various equity metrics and balances the need to maximize carbon reduction with ensuring equitable outcomes for households. We evaluate their effect on CO 2 emission reduction, showing that such equity-aware carbon emission reduction strategies achieve significant emission reduction while also reducing the disparity in the value of selected homes by 5X compared to a carbon-first approach.

Spatial-temporal evolution and peak prediction of embodied carbon emissions in China's interregional trade.

The embodied carbon in inter-regional trade has a vital impact on the allocation of carbon emission reduction obligations and the formulation of carbon emission reduction strategies. Fewer studies have examined the spatial-temporal evolution pattern and peak prediction of embodied carbon emissions in China's inter-regional trade compared with the more numerous results on embodied carbon in international commerce. This paper applies the multi-regional input-output method to estimate the embodied carbon in inter-regional trade resulting from value-added transfer and investigates the spatial and temporal evolution of its patterns. The existence of an environmental Kuznets curve model with embodied carbon emissions as the index of environmental pollution in China is examined, and the time of the inflection point is calculated. The environmental Kuznets curve model is divided into four stages, and a two-dimensional model of economic development and embodied carbon emissions is proposed. The empirical findings indicate that the embodied carbon in China's interregional commerce has an overall rising tendency in the temporal dimension and a distribution characteristic of high in the west and north and low in the east and south in the spatial dimension. The Environmental Kuznets curve, which uses embodied carbon emissions as a measure of environmental pollution, has an inverse U-shaped and the time required to reach the inflection point varies by area. Economic development cannot be cross-stage but can shorten the duration of high carbon emissions. The government should promote the development of differentiated carbon emission reduction policies in each region, construct an inter-regional cooperative carbon emission reduction mechanism, encourage the low-carbon development of inter-regional trade, and realize the internal cycle of China's green economy. This study serves as a guide for the regions to establish scientific and acceptable carbon emission reduction strategies in order to achieve quality interregional trade development.

Organosilicon leather coating technology based on carbon peak strategy

Based on the demand of carbon peak and carbon emission reduction strategy, divinyl-terminated polydimethylsiloxane (ViPDMSVi), poly(methylhydrosiloxane) (PMHS), divinyl-terminated polymethylvinylsiloxane (ViPMVSVi), and fumed silica were used as primary raw materials, polydimethylsiloxane (PDMS) synthetic leather coating was in situ constructed by thermally induced hydrosilylation polymerization on the synthetic leather substrate. The effect of the viscosity of ViPDMSVi, the active hydrogen content of PMHS, the molar ratio of vinyl groups to active hydrogen, the dosage of ViPMVSVi and fumed silica on the performance of PDMS polymer coating, including mechanical properties, cold resistance, flexural resistance, abrasion resistance, hydrophobic and anti-fouling properties were investigated. The results show that ViPDMSVi with high vinyl content and PMHS with low active hydrogen content is more conducive to obtaining organosilicon coating with better mechanical properties, the optimized dosage of ViPMVSVi and fumed silica was 7 wt% and 40 wt%, respectively. In this case, the tensile strength and the broken elongation of the PDMS polymer coating reached 5.96 MPa and 481%, showing reasonable mechanical properties for leather coating. Compared with polyurethane based or polyvinyl chloride based synthetic leather, the silicon based synthetic leather prepared by this method exhibits excellent cold resistance, abrasion resistance, super hydrophobicity, and anti-fouling characteristics.Graphical

Towards carbon neutrality: what has been done and what needs to be done for carbon emission reduction?

Carbon emissions embodied in anthropogenic activities represent the major cause of global warming. Countries, regions, and cities have implemented comprehensive, multi-level and multi-scale measures to reduce emissions and move towards carbon neutrality. The demand for carbon emission reduction (CER) is made more challenging by different geographical locations, country-owned natural resources, and economic development stages. The main objectives of this paper are to conduct a bibliometric analysis to map the frontiers and directions of CER and to explore the paths and development models of CER from the perspective of spatio-temporal, multi-scale, multi-sectoral, and multi-responsible subjects. This study reveals that carbon emission evaluation and prediction, correlation and causal relationship analysis, and CER-related policy simulation and optimization are the most critical hotspots. Additionally, we point out the shortcomings of and future developments for the three study dimensions above. The bibliometric analysis also highlights the fact that a cooperative global value chain as well as amendable policies and mechanisms for CER will help with climate change mitigation and adaptation through the use of advanced carbon capture and storage technologies. We review the technical measures for and policy responses to CER adopted by different countries and industries at the theoretical and practical levels and provide new recommendations. Our work provides important information for climate actions in different countries and sectors and for developing more effective CER strategies and policies.

Carbon emission reduction behavior strategies in the shipping industry under government regulation: A tripartite evolutionary game analysis

Carbon emission reduction in the shipping industry is both an external requirement of the government and an intrinsic sustainable development task for ports and shipping enterprises. This paper constructs a tripartite evolutionary game model involving the government, port enterprises, and shipping enterprises, analyzes the evolution of the carbon emission reduction strategy choice of the three parties, and studies the mechanisms driving the interaction and influencing the subjects’ choices. The results show that (1) to promote carbon emission reduction in the shipping industry, the evolutionarily stable strategy of the three stakeholders is as follows: the government actively regulates, the port enterprises actively reduce emissions, and the shipping enterprises actively reduce emissions. (2) With an increase in the additional cost of government regulation and a decrease in rewards to port enterprises, the probability of the government actively regulating carbon emissions reduction will rise, and the probability of port enterprises actively implementing carbon emission reduction will increase following a reduction in the additional cost and an increase in the opportunity cost of passive emission reduction. (3) An increase in government subsidies for shipping enterprises will lead to a decrease in the additional costs of active emission reduction and an increase in the probability of active carbon emission reduction. This paper provides policy recommendations for carbon emission reduction in the shipping industry, which will help all parties choose the optimal strategy and achieve carbon emission reduction goals as soon as possible.

Research on Evolutionary Game Strategy Selection and Simulation Research of Carbon Emission Reduction of Government and Enterprises under the “Dual Carbon” Goal

As one of the effective market instruments in carbon emission reduction policy, carbon trading is capable of promoting the smooth implementation of the “dual carbon” goal. Based on the path evolutionary game method of information economics, this paper constructs a dynamic game model of the evolution and development of government and enterprise carbon emission reduction. It also analyzes the evolution and development law of government and enterprise carbon emission reduction. We used the carbon market trading data of Guangdong Province to simulate the evolutionary game path of government and enterprise carbon emission reduction under the “double carbon” target and then selected strategies. Results show that (1) Scientific adjustment of carbon quota can effectively shorten the realization time of carbon emission reduction probability of high-pollution enterprises, obtain additional surplus carbon quota, and win extra carbon emission reduction income; (2) Increasing financial subsidies can improve the probability of carbon emission reduction of high-pollution enterprises but cannot prevent the periodic change in carbon emission reduction probability, which in turn helps prolong the “window period” of government regulation on carbon emission reduction; (3) Increasing carbon emission penalties will help high-pollution enterprises actively reduce emissions and improve the motivation of government supervision; (4) The government can introduce a dynamic reward and punishment mechanism. If the government properly chooses the reward and punishment strategy, it may not necessarily pay additional subsidies, so that the government and enterprises can cooperate in tacit agreement to achieve the goal of carbon emission reduction; (5) If the price of carbon emission permits is adjusted, high-pollution enterprises will actively reduce carbon emissions and gain greater benefits no matter what regulatory measures the government takes. Results of this study have profound significance for carbon emission reduction strategies and government regulation of high-pollution enterprises and will help China achieve its “dual carbon” development goal.

China's experience in developing green finance to reduce carbon emissions: from spatial econometric model evidence.

The objective of this study is to attempt to assess the effect of green finance in reducing carbon emissions in China, analyze the transformative role of policy impact in the development of green finance markets, and investigate the impact mechanisms of how green finance affects carbon dioxide emissions. Our time frame from 2007 to 2018 is selected for the empirical study by integrating the availability of data due to the scarcity of relevant statistics in the early days of green finance. Location of this study is in China where 30 provinces are included, excluding Tibet due to severe data shortage. As for methodology, we construct a green finance evaluation index system containing five indicators by entropy weight method, choose dynamic spatial Durbin model (DSDM) for empirical research, and perform mechanism analysis of restructuring industry and greening technology as intermediary channel. Our findings demonstrate that green finance in China does significantly reduce carbon emissions, and its spatial spillover effect and long-term effect are also verified. Furthermore, green finance tends to reduce CO2 emissions through restructuring industry and greening technology. Correspondingly, policy implications are recommended. First, improving green financial market and strengthening information disclosure of green financial market are crucial to facilitate green finance development. Local governments formulate carbon emission reduction strategies focusing on space by joint conference or coordination mechanism like river head system. Lastly, a mechanism should be developed to strengthen the transformation of industrial structure and to promote greening technology.

Examining key impact factors of energy-related carbon emissions in 66 Belt and Road Initiative countries.

Climate change with global warming as the main feature associated with fossil energy use has been recognized as a threat to public health and welfare. Energy-related carbon emission reduction is a more serious challenge for BRI (Belt and Road Initiative) countries with rapid economic development. Examining key impact factors is necessary and helpful. This paper is the first study providing detailed country-by-country analyses aiming to identify the key drivers and inhibitors of energy-related carbon emission in 66 BRI countries with more systematic impact factors. The results show that: (1) Economic development (A), population (Ps), urbanization (Pu), and industrialization (Ss) are the key drivers for 52%, 26%, 11%, and 6% countries of BRI countries. Technological progress (T), energy consumption structure (E), and tertiary industry proportion (St) serve as key inhibitors for 65%, 17%, and 8% countries of BRI countries. (2) Different carbon emission reduction strategies should be formed on different geographical scales. At the international level, carbon emission reduction consensus should be reached and carbon emission reduction targets should be formulated. At the regional level of the Belt and Road Initiative, a carbon emission reduction cooperation fund should be established, and carbon emission reduction technologies and measures should be exchanged and data should be shared to promote the green development of the Belt and Road. At the national level, there should be carbon emission reduction policies reflecting national characteristics. At the local level, there should be specific carbon reduction measures in line with local conditions.

Does the carbon trading mechanism affect social and environmental benefits of the retailer-led supply chain: Strategic decisions of emissions reduction and promotion

Governments, enterprises, and customers have become more concerned about environmental protection. Following the world’s largest carbon trading market (EU ETS), China has also implemented a market-based carbon trading mechanism (CAT) to reduce CO2. Simultaneously, customers have low-carbon preferences for environmental products. Thus, the enterprises’ strategic decisions and collaboration modes have changed. This article develops the Stackelberg game model to explore the impacts of CAT and customers’ low-carbon preference on the carbon emission reduction and promotion strategies in a retailer-led supply chain (such as RT-Mart, Walmart, Amazon, etc.). In this model, the retailer decides whether to promote environmentally safe products and the manufacturer decides whether to reduce CO2. We find that carbon trading market price and customers’ low-carbon preference are key factors influencing the retail price, total carbon emissions, and social welfare. Interestingly, there is not always a positive correlation between customers’ low-carbon preference and social welfare. To achieve Pareto improvement of social welfare, manufacturers and retailers require co-optimization. Theoretically, our research enriches the research streams of the CAT policy and socially responsible operations of the supply chain. Moreover, managerial insights are provided for retailer-led supply chain stakeholders and emission reduction regulators, which contribute to enhancing the social and environmental benefits of the supply chains.