Journal Article

China’s CO2 Emissions from Power Generating Stations and the Role of Subsidies – A First Exploration


  • DU
  • L.
  • Hanley
  • A.
  • Rehdanz
  • K.
Publication Date

Our analysis is the first of its kind to explore patterns of subsidization and CO2 emissions in China’s electricity-producing sector. Applying data for all power plants across China and controlling for the age, capacity and location of generating stations, we find that plants attracting a higher government subsidy are also the plants generating a disproportionate share of CO2 emissions. This distortion is incongruent with China’s aspiration for a greener economy but may be eliminated if China delivers on its November 2013 announcement to review many industry subsidies on its way to a fully fledged market economy.

Kiel Institute Expert


JEL Classification
Q48, Q53

Key Words

  • Carbon Emissions
  • China
  • plant-level data
  • Power sector

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