Efficiency improvement and the carbon-reduction effects of transport restructuring in China

Abstract The growth rate of transportation sector’s carbon dioxide (CO 2 ) emissions is rigid, making it difficult to reduce emissions, especially for developing countries. The existing literature has not yet fully investigated the CO 2 emissions reduction effect of transportation structural adjustment from the perspective of improving productivity, which is defined by total factor energy efficiency (TFEE) in this study. To close this knowledge gap, we first evaluated the TFEE of the transportation sector as a whole and its sub-sectors in 30 provinces in China from 2013 to 2021 based on the parallel data envelopment analysis (DEA) model and then estimated the energy conservation and emissions reduction potentials brought about by the optimization of the transportation structure based on the Long-range Energy Alternatives Planning (LEAP) model. The main results show: (1) TFEEs vary greatly across sub-sectors and provinces, with provinces performing differently across sub-sectors. (2) Compared with the business-as-usual (BAU) scenario, the structure enhancement (SE) scenario of structural adjustment can cumulatively reduce CO 2 emissions by 289.20 Mt by 2030. (3) In the SE scenario, the energy demand will peak in 2026 and the CO 2 emissions will peak at 1509.55 MT in 2027. These results indicate that the CO 2 reduction from the transportation restructuring (structural effect) can exceed the increase in CO 2 emissions following an increase in transportation activity (scale effect) and eventually bring down the total CO 2 emissions for the transportation sector, despite the TFEE rankings of the subsector varying across regions. Therefore, policies that value regions with large volumes, a high share of road transport, and well-established infrastructure, can achieve greater potential to reduce carbon emissions.