The dark side of green innovation policy on energy consumption: From technology substitution effect perspective

The green innovation paradox refers to the transfer of pollution problems, increased costs, excessive resource consumption, or heightened environmental burdens resulting from technological and market limitations associated with green innovation's adverse effects. This paper adopts a perspective centered on the technology substitution effect, utilizing data from Chinese prefecture-level cities as a research sample to delve into the intricate phenomenon of the dark side of green innovation. The study's findings demonstrate that the implementation of the new energy vehicle pilot city policy (NEVPCP) does not lead to a reduction in urban coal energy consumption; instead, it increases it, thereby confirming the existence of the green innovation paradox. Furthermore, the results of heterogeneity analysis reveal variations in the policy's impact on urban coal energy consumption across factors such as self-sufficiency in electricity consumption, the proportion of thermal power generation, West-East Electricity Transmission Policy (WEETP), and regional disparities. Additionally, the study identifies environmental regulation as exerting a positive moderating effect on the relationship between NEVPCP and urban coal energy consumption, exacerbating coal energy usage. Conversely, climate risks exhibit a negative moderating effect, slowing down coal energy consumption. These findings illuminate the dark side of green innovation, offering insights for refining the implementation of the NEVPCP and providing recommendations and references for China's energy consumption transition. Furthermore, they serve as inspiration for energy consumption transitions in emerging market countries. • This paper adopts a perspective centered on the technology substitution effect to delve into the intricate phenomenon of the dark side of green innovation. •This study examines NEVPCP's effects on urban coal consumption, broadening the focus to the technological substitution effect. •This study uncovers coal consumption's hidden consequences, substantiating the green innovation paradox and clarifying its mechanisms.