Qiao-Mei Liang

A model for China's energy requirements and CO2 emissions analysis

This paper introduces a model and corresponding software for modeling Chinas Energy Requirements and the CO2 Emissions Analysis System (CErCmA). Based on the input–output approach, CErCmA was designed for scenario analysis of energy requirements and CO2 emissions to support policymakers, planners and others strategically plan for energy demands and environmental protection in China. In the system, major drivers of energy consumption are identified as technology, population, economy and urbanization; scenarios are based on the major driving forces that represent various growth paths. The input–output approach is employed to compute energy requirements and CO2 emissions under each scenario. The development of CErCmA is described in a case study: Chinas energy requirements and CO2 emissions in 2010 and 2020 are computed based on the input–output table of 1997. The results show that Chinas energy needs and related CO2 emissions will grow exponentially even with many energy efficiency improvements, and that it will be hard for China to maintain its advantage of low per capita emissions in the next 20 years. Chinas manufacturing and transportation sectors should be the two major sectors to implement energy efficiency improvements. Options for improving this model are also presented in this paper.

Platform for China Energy & Environmental Policy Analysis

This paper introduces the China Energy & Environmental Policy Analysis (CEEPA) system. The core of CEEPA is a recursive dynamic computable general equilibrium model, in which the interactions among different agents in the macroeconomic system of China are described. The specific characteristics of Chinese labor market and energy market are also taken into account. The corresponding software system is also developed. CEEPA and its related software was designed for providing decision makers a uniform platform to simulate, analyze and compare different energy and environmental policies conveniently, flexibly and immediately. The application of CEEPA is illustrated in a case study which compares the energy, environmental and socio-economic impacts of energy tax and carbon tax. Results show that given the same extent of direct disturbance, carbon tax is able to restrict energy consumption and CO2 emissions to a greater extent, but the general socio-economic cost caused by energy tax is lower. A uniform platform was developed for Chinas Energy & Environmental Policy Analysis.This CGE-based platform can assess the economy-wide impacts of different disturbances.Scenario-oriented design pattern is one important characteristics of this platform.Application was illustrated by comparing impacts of energy tax and carbon tax policy.

Assessing the Distributional Impacts of Carbon Tax among Households across Different Income Groups: The Case of China

Employing the improved China Energy and Environmental Policy Analysis (CEEPA) model, a recursive dynamic computable general equilibrium model, this study aims to examine the distributional impacts of a carbon tax in China on households over different income groups. The effects of different complementary measures were also analysed. The results indicate that without any protections for households, a carbon tax will widen the income and welfare gap not only between urban and rural but also within urban groups, though it could have a weakly progressive effect within the rural. If the carbon tax revenue is used to reduce indirect tax whilst appropriately increasing government transfers to rural households and vulnerable urban groups in proportion to population, the distributional deterioration caused by the carbon tax could be effectively mitigated, and the negative impact on the living standards of households over all income groups could be alleviated while maintaining emission reductions and minimising the overall socio-economic impacts.

Will a carbon tax hinder China’s efforts to improve its primary income distribution status?

Global climate change has become a considerable threat and has raised widespread concern. The carbon (C) tax is a significant policy option for China to address climate change. However, China is also facing pressing domestic issues, such as the severe income disparity of the primary distribution, which have to be considered when introducing a C tax. Employing a recursive dynamic computable general equilibrium model and considering three labor market scenarios, this study aims to assess the impacts of taxing C on China’s primary income distribution from an economy-wide perspective. The results indicate that taxing C would reduce labor remuneration and its share of the primary distribution, with capital income and its share also decreasing, while net product tax and its share would increase, indicating that taxing C would further deteriorate China’s current primary income distribution status and damage both households and enterprises, while the government would benefit the most. However, in the long run, a low C tax will not strongly exacerbate the inequity in the primary income distribution. The results also indicate that the C tax would perform differently under different labor market scenarios, as well as under different critical elasticity values, which indicates that the complex features of China’s labor market and the development of production technology during the transition period should be taken into consideration when introducing a C tax. Moreover, all scenarios could clearly reduce carbon dioxide (CO2) emissions, with the reduction under the labor-surplus scenario being more obvious.

National vulnerability to extreme climatic events: the cases of electricity disruption in China and Japan

Abstract Extreme climatic events are likely to adversely affect many countries throughout the world, but the degrees among countries may be different. China and Japan are the countries with high incidences of extreme weather/disaster, both facing with the urgent task of addressing climate change. This study seeks to quantitatively compare the impacts of extreme climatic events on socioeconomic systems (defined as vulnerability) of the two countries by simulating the consequences of hypothetical same degree of electricity disruption along with extreme events. To do that, two computable general equilibrium models are constructed, by using which three-stage scenarios are simulated for China and Japan, respectively. The results reveal that China and Japan have unequal socioeconomic vulnerabilities to extreme events. (1) Negative impact of the same degree of power outages is bigger on China’s socioeconomic system than on that of Japan, and this difference is more obvious in the very short-run scenario. (2) The decline of China’s GDP, total output, and employment levels is 2–3 times higher than that of Japan, while the difference of the resident welfare levels is sharper, which of China drops 3–5 times of Japan. (3) Structural factors are the main reason for vulnerability differences between China and Japan, including the differences of expenditure structure, factor input structure for production of life requirement sectors, material and energy dependence for the production of industrial sectors, and usage structure of services outputs. Based on these findings, some policy implications and recommendations for fairness issues on climate change adaptation are proposed.

Impact of household expenditures on CO2 emissions in China: Income-determined or lifestyle-driven?

The aim of this paper is to analyze the relationship between household expenditure and CO2 emissions among different income groups of urban and rural households in China. Having employed the 2007 Social Accounting Matrix of China, this study examines the direct and indirect CO2 emissions caused by household demand. The results show that within both urban and rural households, the higher the income level is, the higher the per capita emissions are; the CO2 emissions per unit expenditure due to savings and taxes are generally much larger than those from consumption of goods and services; and these emissions per unit consumption expenditures mainly come from indirect emissions. To deeply explore the relationships between consumption patterns and CO2 emissions, two scenarios are established to eliminate the differences in income level and consumption propensity among different groups step by step. Main results indicate that (1) the income gap is the primary cause of the significant differences in emission levels among each group; (2) the difference in consumption propensity is also a notable reason; and (3) the rural higher income groups spend a larger share of their income on those carbon-intensive goods (e.g., electricity, transportation, energy products), thus making their consumption patterns more carbon-intensive, while for the urban, the consumption patterns of lower income groups are more carbon-intensive. Finally, policy recommendations on the reduction of household emissions are also made.

Sharing mitigation burden among sectors in China: Results from CEEPA

Abstract Based on the China Energy and Environmental Policy Analysis model which takes into account the current characters and potential reforms of energy markets in China, and from the perspective of economy-wide cost-effectiveness, this study aims to analyze how carbon mitigation burdens should be shared among key emission sectors in China, as well as how these sectors would behave to meet their burdens. This study finds that in general, allocating mitigation burdens based on historical emissions could realize the national target in a cost-effective way. However, some adjustments should be made to the coal, electricity, and transportation sectors. The mitigation targets for all sectors, especially for the coal sector, should not be set too high in the short-term. And the burden shared by the electricity sector should increase if electricity pricing is deregulated; meanwhile, energy efficiency and the energy input structure should be improved in the electricity sector.

CO2 Emission Abatement Technology and Impact Analysis

The reduction of global CO2 emissions and mitigation of global climate change has become the consensus shared by the international community. How to effectively reduce CO2 emission is not only a scientific problem, but also a technical problem. With the upsurge in the calls for reducing CO2 emissions, a variety of emerging CO2 emissions technologies have become important options for reducing CO2 emissions. What are the technical economy characteristics, emission reduction potentials and development prospects for different CO2 emissions technologies? In regard to these questions, this chapter introduces the most important CO2 emissions technologies at the present time, and analyzes the following questions in line with the result of technical simulation: Currently, what are the major CO2 emission reduction technologies? How is the status of major CO2 emission reduction technologies? How about the abatement potential of different CO2 emission reduction technologies? What challenges and opportunities will be faced by different CO2 emission reduction technologies? How is the future development perspective? During the process of CO2 emission reduction, what contributions has the renewable energy power generation technology made to socio-economic development?

An application of SCGE model to assess the labour and capital related economic loss in Nankai earthquake

This paper established a spatial computable general equilibrium model to simulate the Japanese economy. Four scenarios representing different possible labour and capital loss in the prospective Nankai earthquake were set up to assess the impacts of labour and capital on regional economy.

Socioeconomic impacts of a shortage in imported oil supply: case of China

Oil is an essential and important energy source and is related to energy security and national strategy. Based on a recursive dynamic computable general equilibrium model, this study examines the potential impacts on the major socioeconomic indices in China, which includes economic growth, price level, employment, household welfare, and production activity, under different imported oil shortage scenarios. Results show that oil shortage has negative impacts on China’s economic growth; if all the extra proceeds from domestic oil price increase is assigned to government budget for compensating investment loss, the negative impacts on GDP will mainly stem from its negative impacts on total consumption; the decrease in labor income plays an obviously greater role in the decrease in total consumption than the effects of an increase in CPI. The negative impacts on rural households are greater than urban households. The profit of most production sectors, and the export of almost all sectors, will be negatively influenced.