Study on the impact of green bond issuance on the green and low carbon development of Chinese thermal power enterprises

Thermal power generation is a sector of critical importance in global energy consumption, yet it also stands as a major source of environmental pollution. Against the backdrop of China’s diminishing resource and environmental carrying capacity and escalating global climate change, this study examines the impact of green bond issuance on the green and low-carbon development of thermal power enterprises, along with its underlying transmission mechanisms. Employing methodologies such as difference-in-differences (DID) and mediation effect analysis, we analyze data from A-share listed thermal power companies in Shanghai and Shenzhen stock exchanges spanning 2007 to 2021. Furthermore, we investigate the heterogeneous effects of green bonds on enterprises of varying scales and across different regions.The results demonstrate that green bond issuance significantly promotes the green and low-carbon development of thermal power enterprises, both directly and indirectly—a finding robust to a series of sensitivity tests. Moreover, the effects vary considerably depending on firm size and geographic location. This study provides valuable insights into the economic implications of green bonds in China and offers policy guidance for the green transformation of the thermal power industry.