Courtesy of Cornell University

China energy policies designed to curtail energy use sometimes does the opposite.

March 5, 2019

Not All China Energy Policies Are Effective, Study Finds

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Despite national, state and local efforts to curb energy consumption, some Chinese energy policies might not work at all — some of them might even have the opposite effect, a new study found.

The study, recently published in Energy Economics, was conducted by Shuyang Si grad and Prof. C. Y. Cynthia Lin Lawell, applied economics and management. They were the first to examine China’s entire set of different energy policies as a whole. Most prior papers on China’s energy policies focused on a single policy’s effect on reducing energy consumption or promoting energy conservation behaviors, according to Si.

“We feel like that’s not complete. It’s not enough. We planned to look at the broader picture, taking all the possible policies we can find into account, and estimate the overall effect of all the policies together,” Si told The Sun.

China produces the most pollutant gases associated with climate change in the world. The country has adopted goals at the national as well as at local and provincial levels that aimed at limiting emissions. In developing countries, the rapid increase in energy consumption has led to problems such as power shortages and environmental pollution.

Si spent a year collecting data from 2,656 energy-related laws and policies from 2002 to 2013. He then organized the data by policy type and analyzed their effects.

His analysis found that while some laws or policies were successful in decreasing energy consumption, some others actually had the opposite effect. For example, non-monetary awards for the technology sector to reduce fossil fuel consumption achieved its intended outcome, but providing monetary incentives — such as offering loans to firms or households — for reducing fossil fuel consumption actually resulted in an increase in consumption.

Similarly, Si finds that increased education and information on efficient energy use also led to a significant rise in energy consumption. This may be due to a “rebound effect,” Si explained, which happens when people change their behavior in a way that counteracts the gains from improving energy efficiency.

“I’m using energy efficient appliances, so I feel like I can use them more often,” Si explained. “Your lifestyle will actually be using more energy.”

The data used in the study was obtained from the China Energy Statistical Yearbooks and official government policy document — a potential source of concern, said Si.

“Everyone who studies China fears that these numbers are not trustworthy, but this is the best that we can do,” Si told The Sun.

Nevertheless, even when using data published and approved by the Chinese government, Si and his coauthors found that some energy-related policies in China may be ineffective or even have counterproductive consequences.

In the future, Si hopes that his study will help develop the most effective energy policies or policy combinations.