Evaluating the effects of green development policies on energy security and carbon emissions reduction

Considering the complex international relationships and unstable trade relations involved, examining the effects of green development policies on energy security and carbon emissions reduction is essential for advancing China's carbon peak and neutrality goals. This study constructs a dynamic computable general equilibrium (CGE) model that includes a resource exhaustion module and an endogenous electricity technology module and evaluates the effects of green development policies in the context of a possible oil-import supply disruption shock in China. The results show that resource and oil taxes will generate temporary double dividends but have limited effects on reducing carbon emissions and energy consumption. Second, carbon pricing causes high GDP loss while lowering energy consumption and carbon emissions. Third, improving non-fossil electricity investment has a positive effect on carbon emissions reduction, non-fossil energy development and long-term economic growth due to learning by doing effects; however, over-investment would cause GDP loss. Fourth, structural adjustment of end-use energy consumption and improving industrial electrification could drive the low carbon transformation of the economy from the demand side, which can have considerable economic benefits while achieving carbon reduction and improving energy security. Fifth, single policy characteristics and policy interactions should be considered when multiple green development goals exist. The harmonious design of a combination of supply- and demand-side policies can improve carbon mitigation and energy transformation efficiency.