How Justice Is Our Energy Future? Assessing the Impact of Green Finance on Energy Justice in China

Abstract

Ensuring energy justice is crucial for achieving social stability and realizing low-carbon development. Accordingly, we estimate the effect of green finance (GF) on energy justice in China and further explore its influencing mechanisms using the system-generalized method of moments (SYS-GMM). For this purpose, we first assess the levels of energy justice across 30 Chinese provinces. The main results show the following: (1) China’s energy justice index generally shows an upward trend during the observation period. (2) GF can directly promote China’s energy justice, mainly by increasing procedural justice, recognition justice, and restorative justice. (3) GF also indirectly increases energy justice by promoting environmental regulation and green total factor productivity (GTFP). (4) The effect of GF on energy justice is heterogeneous and asymmetric. Specifically, it is more pronounced in southern China, regions with low GF indexes, and regions with high energy justice indexes. This study’s findings enrich the existing literature and provide policy implications for China’s realization of energy justice.