The impact of the energy transition on China’s economy under the carbon peaking and carbon neutrality goal: A simulation analysis based on the CGE model

Abstract

With the acceleration of the global response to climate change, China announced to the world in 2020 the goals of carbon peaking by 2030 and carbon neutrality by 2060, which reflects its firm determination implement Intended Nationally Determined Contributions. Energy transition is the key to achieving the carbon peaking and carbon neutrality goals. It is of great theoretical and practical significance to study the impact of low carbon energy transition on China?s macro-economy under the carbon peaking and carbon neutrality goals. Based on three carbon neutrality scenarios, this paper uses the dynamic computable general equilibrium model to simulate and estimate the impact of different energy transition pathways on China?s macro-economy. The results show that under the carbon peaking and carbon neutrality target, accelerating energy transition will have a certain nega?tive impact on China?s economic growth, and different energy transition pathways have different impacts on the macro-economy. The sustainable transformation scenario that promotes energy transformation through the carbon tax policy to adjust carbon emission intensity and the renewable energy incentive policy to reduce costs has the least negative impact on the macro-economy, promoting employment growth, and optimizing industrial structure to a certain extent in the process of energy transformation. In conclusion, relevant policy recommendations are put forward for the achievement of the carbon peaking and carbon neutrality goals, and the promotion of high quality economic development.