Chinese Energy Research Articles

The Political Economy of Variations in Energy Debt Financing by Two Chinese Policy Banks in Africa

ABSTRACTThis article examines the puzzle of why China's two policy banks, China Development Bank (CDB) and the Export‐Import Bank of China (Eximbank), have lending portfolios for power‐generation projects in Africa that have drastically different levels of carbon dioxide emissions. From the supplier side, Eximbank balances two imperatives: Beijing's ideational ambition as a new development provider to African recipients with sustainability commitments, and China's industrial goal to offshore non‐renewable capacity. In contrast, the CDB prioritizes its commercial interests, which results in the bank lending solely for coal projects. On the demand side, Eximbank's concessional capital has emerged as a second‐best option among international financial sources for renewable and hydropower generation projects. Conversely, CDB's market‐rate lending makes it the fiscal last resort for host countries seeking financial support for thermal‐power projects which are shunned by other financiers. This divergence can be understood through the polycentric development finance model, which captures the parallel decision‐making institutions governing Chinese energy financing in Africa. Specifically, the lending decisions of Eximbank are linked with institutionalized policy processes, translating priorities of Chinese and African state actors. Meanwhile, the loan origination processes of CDB are more independent of state actors, allowing greater autonomy for the financier to pursue commercial interests.

Towards Secure Energy Systems: Examining Asymmetric Impact of Energy Transition, Environmental Technology and Digitalization on Chinese City-level Energy Security

This study aims to investigate the asymmetric impacts of energy transition (ETI), environmental technology (ENT), and digitalization (DEI) on energy security (ESI) across Chinese cities, addressing a significant gap in empirical research at the city level. We employ the Method of Moments Quantile Regression (MMQR) to analyze data from 275 Chinese cities over the period 2007-2020, examining the differential effects of positive and negative shocks in ETI, ENT, and DEI on ESI across various quantiles. Utilizing MMQR, the analysis yields several key findings: (i) Positive shocks in ETI benefit cities with high pre-existing ESI, while negative shocks surprisingly provide a temporary boost to low-security cities but ultimately hinder progress at higher levels. (ii) Positive shocks in DEI correlate with higher ESI, especially in cities with moderate to high baseline security, whereas negative shocks in DEI exhibit minimal influence on ESI. (iii) Positive shocks in ENT generally enhance energy security across all quantiles except the lowest, indicating that advancements benefit cities at various security levels. Notably, negative shocks initially decrease ESI at the lowest quantile but subsequently increase it at moderate to high levels. These findings highlight the complex, non-linear relationships between ETI, ENT, DEI, and ESI in Chinese cities. The study provides quantitative evidence for policymakers to develop nuanced strategies that balance energy transition, digitalization, and environmental technology advancements with energy security goals. Future research should explore the mechanisms underlying these asymmetric effects and their implications for sustainable urban development in China.

Digital transformation, audit risk, and the low-carbon transition of China's energy enterprises

While digital transformation is recognized for driving efficiency and sustainability in China's energy sector, its impact on low-carbon transitions through the lens of audit risk remains underexplored. This study examines how digital transformation, encompassing technologies like AI, IoT, Big Data, and blockchain, affects the low-carbon transition of Chinese energy enterprises, with a specific focus on the mediating role of audit risk. Using data from 2008 to 2022, we find that digital transformation significantly enhances low-carbon transitions. Furthermore, our analysis reveals that audit risk, particularly abnormal expenses, mediates this relationship, with lower audit risk amplifying the positive effects of digital transformation. This underscores the importance of robust audit and risk management practices in ensuring the effectiveness of digital transformation for achieving sustainability goals. Importantly, our findings highlight key heterogeneities in this relationship: the impact of digital transformation varies across regions in China and is influenced by the type of audit firm. This suggests that the Eastern region and firms audited by Non-Big Four firms experience the most significant benefits from digitalization in their pursuit of low-carbon transitions. These insights offer valuable guidance for energy companies and policymakers navigating the complexities of digital innovation and sustainable development in China's energy sector.

Analysis of SWOT Model Analysis BYD Automobile Marketing Strategy

Environmental pollution is a hot issue that the world cares about, and fuel vehicles are one of the main reasons for the greenhouse effect. All countries in the world have also realized this and proposed corresponding policies to stop the further deterioration of this impact. China actively responded to accelerate the development of the new energy vehicle industry through policy support. Among them, BYD, as a pioneer, showed industry leadership. This article will analyze the market of China’s new energy vehicles based on the status of the development of new energy vehicles, and use the SWOT model to analyze BYD’s advantages, opportunities, and risks. Through research on this article, driven by strong policies in the Chinese new energy vehicle market, it has achieved significant growth. As a market leader, BYD comprehensively covers consumer groups, showing a strong market penetration. However, despite the outstanding results, BYD still faces threats and challenges from various aspects such as market competition and technological innovation. Looking forward to the future, BYD needs to continue to optimize the layout of the product and strengthen its core competitiveness to cope with potential risks. Its development direction is expected to maintain a steady rise and continue to lead the vigorous development of China’s new energy vehicle industry.

Discourse Historical Analysis of Identity Construction of New Energy Enterprises in China and the United States

In recent years, with the increasing awareness of climate change and environmental protection, new energy vehicles have gradually become a hot topic in the automotive industry. This article uses the Social Responsibility Report of BYD and Impact Report of Tesla as corpus, adopts a discourse-history research approach to analyze the three-dimensional framework of discourse analysis, and uses the corpus tool Wmatrix 6.0 to analyze the macro-themes, meso-discourse strategies, and micro-language features of corporate identity construction in China and the United States, explaining their similarities and differences in the construction of new energy enterprise identities. This study provides reference for the identity construction of new energy enterprises in China, and has practical significance for enhancing the international discourse construction ability of Chinese new energy enterprises.

Investing in green, sustaining the planet: The role of fintech in promoting corporate green investment in the Chinese energy industry

In recent years, fintech has rapidly developed on a global scale, bringing about significant transformations across various industries. Particularly in the energy sector, the potential of fintech to promote corporate green investment has increasingly become a focus. As the energy industry accounts for a significant proportion of global greenhouse gas emissions, guiding companies in implementing green investment has become an important issue for environmental protection and sustainable development. However, previous studies have rarely systematically investigated the influence of fintech on corporate green investment in the energy industry and the mechanisms involved. Hence, this study aims to bridge this research gap within the context of China. By utilizing valid survey data from 466 corporations in the Chinese energy industry and the method of structural equation modeling, the results indicate that: (1) Fintech can promote corporate green investment in the energy industry. (2) Fintech can promote corporate data-driven decision-making capability, information transparency, and sustainable development strategy. (3) Data-driven decision-making capability, information transparency, and sustainable development strategy can also promote corporate green investment in the energy industry. (4) Mediation analysis reveals that data-driven decision-making capability, information transparency, and sustainable development strategy each play a mediating role in the impact of fintech on corporate green investment. (5) Comparative analysis of the mediation effects indicates that there is a certain degree of difference among these three variables’ mediating effects, but it did not reach a statistically significant level. This study provides rich insights for business practices, encouraging companies to strengthen their focus on green investment in the fintech era and offer guidance and recommendations to relevant stakeholders, thereby providing practical guidance for corporate green transformation and sustainable development. Finally, this research also contributes to policy development and optimization.

Research on the Investment Value of BYD Based on SWOT, Financial, and Valuation Methods

Against the backdrop of environmental degradation, green energy transformation is a strategic measure to address climate change and promote green development. The new energy vehicle industry is experiencing an unprecedented period of rapid growth. As a leading player in this sector, BYD's development is virtually representative of the Chinese new energy vehicle industry. SWOT analysis, financial analysis, and valuation analysis are crucial criteria for assessing the development status of a company. Through the analysis of profitability, operational capability, and P/E ratio data, the development status, operational capability, market competitiveness, and growth potential of a company can be directly reflected. The results show vertical integration of supply chain and cost advantage is the main strength of BYD, however it has the weakness of excessive dependence on Chinese government subsidies. From the perspective of financial performance, it has great profitability and its operating capacity situation is good. Moreover, the valuation shows it is worth for investment. This provides decision-makers with information and suggestions on enterprise management, investment, and financing, helping investors and managers make rational decisions.

Energy renovation model in China: Research and recommendations

In the past 20 years, a large number of houses in China have aged, and the energy systems of older houses have lagged behind the current living demand. This research compares the energy renovation models in China and the United States, and founds that the Chinese energy renovation model has difficulties such as a small scope of application and difficulties in raising funds. And then, a case study on the Korean. It concludes that in the early stage of the development of building energy efficiency, energy-saving guarantees mode can promote energy-saving projects. In the middle and late stages, the contract guaranteed market survival space can be suppressed, and the energy-saving industry can be adjusted to be dominated by energy-saving sharing.

Crisis PR in the New Media Era: the Impact on the Reputation of Chinese New Energy Businesses

The self-transformation of new media presents unprecedented challenges for crisis PR. In recent years, the rapid development of new energy vehicles in China has often led to widespread criticism when facing crisis Public Relations (PR) issues. This study takes Tesla, NIO, and Li Auto, three companies developing new energy vehicles in China. It compares their crisis PR strategies in the new media era, exploring their impact on corporate reputation. By collecting the quantity of cognitive and emotional assessments of positive, neutral, and negative nature, and calculating the conversion between evaluations of different natures, this research finds that incorrect response strategies lead to a decrease in both emotional and cognitive reputations, while successful response strategies primarily enhance cognitive reputation. Successful strategies may involve subjective proactive measures, characterized by swift or preemptive PR, positive emotional attitudes, and sustained responsiveness. This study provides empirical insights into understanding and addressing the challenges of crisis PR in the new media era, offering references for companies to formulate crisis management strategies.

Segmenting the Chinese New Energy Compact SUV Market: A Latent Class Analysis of Consumer Preferences

The burgeoning new energy vehicle (NEV) sector in China, particularly the compact SUV market, presents a dynamic landscape for consumer preferences and behaviors. This study employs a latent class analysis (LCA) to segment the Chinese new energy compact SUV market, aiming to identify distinct consumer groups with homogeneous preferences and behaviors. Utilizing a comprehensive dataset of 6,720 consumer samples sourced from a reliable automotive statistics website, the study delineates two primary consumer segments: "Luxury Brand Preference Buyers" and "Normal Brand Rejection Buyers." The findings reveal that the former segment exhibits a marked preference for luxury brands, and tends to make fewer purchases, predominantly in the last quarter of the year 2023. In contrast, the latter segment shows a strong preference for another luxury brand and a balanced distribution of purchase quantities throughout the year, with a clear rejection of normal brands. These insights are instrumental for NEV enterprises to develop targeted marketing strategies that cater to the specific needs and preferences of these consumer segments, thereby enhancing market share, consumer satisfaction, and loyalty.

Prediction of metal recovery potential of end-of-life NEV batteries in China based on GRA-BiLSTM

As Chinese new energy vehicle (NEV) sales continue to grow, end-of-life batteries have great potential for recycling in the future. In this study, a combined model based on Gray Relation Analysis and Bi-directional Long Short-Term Memory (GRA-BiLSTM) is proposed for predicting NEV sales, and the NEV battery life is modeled using the Weibull distribution. Then, the amount of end-of-life batteries, secondary utilization and metal recycling are calculated. The impact of end-of-life battery recycling on the supply and demand of key metals is studied. The results show that in 2040, the secondary utilization of end-of-life batteries in the Standard Growth Rate-Lithium Iron Phosphate Battery Dominated-High Secondary Utilization rate scenario (SGR-LFPH) is 391.76 GWh. The recycling volumes of lithium, nickel and cobalt are 45,900 tons, 92,900 tons and 22,100 tons, respectively. In the Standard Growth Rate-lithium nickel cobalt manganese oxide Battery Dominated-Low Secondary Utilization rate scenario (SGR-NCML), the recycling of lithium, nickel and cobalt is even greater, at 62,600 tons, 372,200 tons and 71,700 tons, respectively. End-of-life batteries recycling can reduce the demand for metals. However, as NEV sales continue to grow, the gap between metal supply and demand remains significant. The findings urge the Chinese government develop appropriate battery management strategies to increase the recycling rate of end-of-life batteries; and to encourage enterprises to research new types of batteries to resolve the conflict between supply and demand for metals.

On the Effects of Physical Climate Risks on the Chinese Energy Sector

We examine the impact of physical climate risks on energy markets in China, distinguishing between traditional energy and new energy stock markets, and the energy commodity market, utilizing a time-varying parameter vector autoregressive model with stochastic volatility (TVP-SV-VAR). Specifically, we investigate the dynamic effects of five specific subtypes of physical climate risks, namely waterlogging by rain, drought, typhoon, cryogenic freezing, and high temperature, on WTI oil prices and coal prices. The findings reveal that these physical climate risks exhibit time-varying similar effects on the returns of traditional energy and new energy stocks, but heterogeneous effects on the returns of WTI oil prices and coal prices. Finally, we categorize and examine the impact of both acute and chronic physical risks on the energy commodity market.

Time-frequency spillovers and connectedness between Chinese climate risk perception and energy markets

Abstract With the global warming is becoming more and more serious, the global need for low-carbon economic transition is increasingly urgent. This study focuses on the time-frequency spillover effect of climate risk perception and energy market. By constructing transition risk perception and physical risk perception index and using time-frequency analysis, we quantifies the impact of climate risk perception on fossil energy and clean energy markets, and reveals the dynamic relationship between the two. The findings indicate that China’s sense of transition risk from climate change has increased since the Paris Climate Agreement, but the perception of physical risk has changed less. Moreover, the spillover effect between climate risk perception and energy markets is time-varying and increases rapidly in the face of climate or energy related uncertain events. The COVID-19 pandemic has resulted in a sharp drop in total spillover, and there is little near-information spillover between the energy markets and perceptions of climate danger. We also found that in the short term, energy market spillovers are net recipients of climate risk perception according to marginal spillover research. However, this connection changes to become a net transmitter from 2021. In the medium to long term, the perception of climate risk begins to function as a net transmitter of spillovers to energy markets.

Spillover and dependence between Chinese carbon and new energy stock markets: A cross-quantile perspective

The interplay between China's carbon emissions trading market and the new energy stock market has attracted increasing scholarly attention, given their alignment with green and sustainable development goals. This study utilizes the Cross-Quantilogram methodology to assess predictability and spillover dynamics in the Chinese carbon markets and the new energy stock markets across various quantiles. The analysis yields some significant findings: (1) Despite the small magnitude, bidirectional spillover effects are discernible between China's carbon market and the Chinese new energy market, with heterogeneous correlation among the three pilot carbon markets. (2) The cross-quantile correlation among markets exhibits varying dynamics with increasing lag orders. (3) During market downturns, the new energy market poses short-term abnormal extreme risks as a spillover source for the Guangdong carbon market, while exhibiting a stronger spillover effect on the Hubei carbon market during longer lag periods. (4) Certain sectors, such as the wind power, nuclear power, and photovoltaic sectors, stand out with a more pronounced cross-quantile in relation to the carbon market. (5) Both risk events and policy changes play a significant role in shaping market interactions. (6) Including Guangdong and Hubei carbon asset in a portfolio can effectively reduce the volatility risk of new energy stock portfolios. A valuable comprehension of the intricate interdependencies between China's carbon market and new energy assets is provided by this research, benefiting policymakers and investors in the energy and environmental sectors.

Lead-lag relations between the Chinese carbon and energy markets: Evidence from extreme climate shocks

We examine how lead-lag relationships between China's carbon market and energy markets change during extreme climate events. We show that extreme climate events strengthen the lead-lag relationship between markets, especially during extreme cold and heat periods during which energy demand spikes.

Retraction Note: Industrial productive efficiency nexus with energy poverty and energy transition in digital economy: findings of Chinese transport and energy development industries

Retraction Note: Industrial productive efficiency nexus with energy poverty and energy transition in digital economy: findings of Chinese transport and energy development industries

The impact of NOCs in Chinese foreign policy: the cases of Angola and Sudan

AbstractChinese companies have invested substantially in countries abroad in recent years, including countries in Africa. This article investigates the activities of Chinese energy companies in Africa, looking at the cases of Angola and Sudan. It develops a theoretical framework that can examine the role of non-state actors in foreign policy. The article presents evidence that non-state actors play a role for Chinese foreign policy and sometimes go against the policy line from Beijing. Theoretically, it illuminates the increasing role played by national oil companies (NOCs) in foreign policy and contributes with explicitation of the role played by NOCs for the foreign policy of the state. The article also contributes with insights regarding the importance of concerns with domestic stability (weiwen) to Chinese foreign policy and how this motive relates to the Chinese NOC activities in a number of countries.

Bootstrap inference for linear time-varying coefficient models in locally stationary time series

Time-varying coefficient models can capture evolving relationships. However, constructing asymptotic confidence bands for coefficient curves in these models is challenging due to slow convergence rates and the presence of various nuisance parameters. A residual-based sieve bootstrap method has recently been proposed to address these issues. While it successfully produces confidence bands with accurate empirical coverage, its applicability is restricted to strictly stationary processes. We introduce a new bootstrap scheme, the local blockwise wild bootstrap (LBWB), that allows for locally stationary processes. The LBWB can replicate the distribution of the parameter estimates while automatically accounting for nuisance parameters. An extensive simulation study reveals the superior performance of the LBWB compared to various benchmark approaches. It also shows the potential applicability of the LBWB in broader scenarios, including time-varying cointegrating models. We then examine herding effects in the Chinese renewable energy market using the proposed methods. Our findings strongly support the presence of herding behaviors before 2016, aligning with earlier studies. However, contrary to previous research, we find no significant evidence of herding between around 2018 and 2021. Online supplementary materials are available for this article.

Dancing between threats and conflicts: How Chinese energy companies invest amidst global geopolitical risks

Utilizing Chinese A-share listed energy companies from 2002 to 2021, we investigate the relationship between global geopolitical risks (GPR) and corporate investment through panel fixed effects and attempt to elucidate its channel. The main findings are as follows: Different types of GPR have varied impacts on corporate investment; global geopolitical acts (GPRA) significantly promote investment in Chinese energy companies, while global geopolitical threats (GPRT) substantially inhibit it. Channel analysis indicates that the capital hedging effect can explain the impact of GPR on the investment of Chinese energy companies. Moreover, the interactions between GPR and factors such as companies' commercial credit capability, valuation, operational risk, and degree of internationalization are statistically significant. These factors interact with GPRA and GPRT, jointly affecting the investment of Chinese energy companies. After employing a series of robustness tests, our results remain valid. Our research deepens a better understanding of how geopolitical risks influence the investment decisions of energy companies.

Detecting speculative bubbles in the Chinese energy market: evidence from a GSADF test

ABSTRACT Analysing bubbles in China’s energy futures market facilitates the identification of the unique driving factors of bubbles in emerging markets. We apply the Generalized Supremum Augmented Dickey-Fuller (GSADF) and Supremum Augmented Dickey-Fuller (SADF) to verify the bubbles of crude oil (SC), power coal (ZC) and liquefied petroleum gas (LPG). Furthermore, we use the GSADF method to identify the definite generation and bursting times of these futures. The empirical results show that three bubbles occurred in the SC and LPG markets between 22 June 2020 and 26 September 2022 while four occurred in ZC during the same period. As an international commodity, SC bubbles are highly influenced by global factors, such as the global economy and geopolitical situation. In China, ZC bubbles are mainly influenced by domestic factors, such as price guidance, environmental protection policies and power demand. LPG bubbles are influenced by global oil prices and domestic policy regulations. Therefore, based on the timely bubble detection method, policymakers may take ex ante measures, such as regularly assessing the risk of bubbles and augmenting supply in the spot market, rather than simply adopting ex post strict price control. Additionally, investors and entrepreneurs can take early risk-hedging steps to reduce potential losses.