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Is it the heavy industry or light industry that performs better in energy efficiency incorporating undesirable outputs? Energy efficiency is the gap between actual and target energy inputs, thus the more energy intensive heavy industry is not necessarily the less energy efficient one. The purpose of this paper is to evaluate and compare the ecological total-factor energy efficiency (ETFEE) of the heavy and light industries as well as to assess their technology gaps. Considering the slack-bias of conventional DEA models and technological heterogeneity between heavy and light industries, the slack-based DEA model (SBM) and meta-frontier technology have been combined. The empirical results show that: (1) China's industries did not perform efficiently. Among them, heavy industry, albeit has more advanced technology, demonstrates lower energy efficiency than light industry. Thus, China needs to stimulate heavy industry to achieve its potential in efficiency improvement. (2) Compared with light industry, governmental stimulus induced expansion has promoted technological advancement in heavy industry, but it still has had no effect on the utilization of existing technologies by, for example, improving the managerial efficiency. Greater pressure on environmental standards is needed to motivate factories in heavy industry to utilize existing technologies more sufficiently. (3) Technological gap among industries has enlarged, thus more attention should be paid on encouraging technology spillover from heavy industry to light industry. [ABSTRACT FROM AUTHOR]

When talking about energy conservation, "Rebound Effect" (RE) is always concerned, which defined as the increasing energy consumption relative to the counterfactual predicted by technological progress because of efficiency induced decrease in the real price of energy services. In this paper, we try to find a way to figure out the RE through calculating the substitution relations accord with the definition. Based on the trans-log cost function and considering the asymmetric impact on energy-cost share equation, the paper applies Allen-Uzawa substitution elasticity to establish the price-oriented analysis diagram of fossil-energy consumption RE. Using time series data, applying the joint method of the dynamic OLS (DOLS) and the seemingly unrelated regressions (SUR), the RE in China's electricity generation sector is estimated. The results showed that the RE is 11.6% in China's electricity generation sector if allowing for asymmetric price effects, which indicates that China's power generation sector generally displays a feature of energy saving. [ABSTRACT FROM AUTHOR]

Renewable energy is believed to be the central issue in sustainable development. Literatures on renewables׳ costs are rather sparse, especially on costs of integration and system balancing. The objective of this paper is to fill the research gap by providing an assessment for the cost of China׳s grid-connected renewable energy development and analyze its sharing between different stakeholders. Due to China׳s pricing mechanism of renewable energy and their cost decreasing potential, the pricing model of feed-in tariff and dynamic technological learning processes are employed. In the estimation of purchasing cost, the positive bias is overcome by considering China׳s energy-saving dispatching policy. The results suggest that purchasing cost would be 32.57–40.80 billion Yuan over 2012–2020, and peak in 2017. Grid integration costs which further involve costs of grid infrastructure and system balancing are also investigated. We find that grid infrastructure will cost 27.88 billion Yuan by 2015 and soar to 45.32 billion by 2020, while system balancing will cost 31.49 billion Yuan in 2015 and 63.97 billion Yuan in 2020 among which a substantial part (over 60%) comes from electricity loss in energy transfer. The different parts of these costs are underwritten by disparate participants due to China׳s renewable energy policies and its institutional arrangement. Purchasing cost is shared by power consumers through RES; the cost of grid infrastructure is mainly covered by grid enterprises; and there is no mechanism to specify how to share the cost electricity loss during system balancing which might become a major obstacle for system balancing. [ABSTRACT FROM AUTHOR]

China, with a heavy dependence on coal power, has announced a clear goal of carbon neutrality by 2060. Electrification of final energy use and high penetration of renewable energy are essential to achieve this. The resulting growth of intermittent renewables and changes in demand curve profiles require greater flexibility in the power system for real-time balancing – greater ability of generators and consumers to ramp up and down. However, the plan and market system with regulated prices makes this challenging. We discuss the options to improve flexibility, including 1) increasing supply-side flexibility, through retrofitting existing power plants to boost their responsiveness; 2) promoting flexibility from power grids, through building an efficient power grid with inter-provincial and inter-regional transmission capacity to balance spatial mismatch, given that China has a vast territory; 3) encouraging demand flexibility, through demand-response measures to enable demand shifting over time and space to address fluctuations in renewable energy generation; and 4) providing flexibility from energy storage. We consider policies to achieve this, in particular, power market reforms to unlock the flexibility potential of these sources. Regulated electricity prices and lack of auxiliary services markets are major obstacles and we discuss how markets in other countries provide lessons in providing incentives for a more flexible system. • Carbon neutrality requires electrification and intermittent renewables. • Discuss options to improve flexibility in power system with high renewables. • Attention to technology and market policies in system with regulated prices and quotas. • Exploring how markets in other countries may provide lessons for China. [ABSTRACT FROM AUTHOR]

China, with a heavy dependence on coal power, has announced a clear goal of carbon neutrality by 2060. Electrification of final energy use and high penetration of renewable energy are essential to achieve this. The resulting growth of intermittent renewables and changes in demand curve profiles require greater flexibility in the power system for real-time balancing – greater ability of generators and consumers to ramp up and down. However, the plan and market system with regulated prices makes this challenging. We discuss the options to improve flexibility, including 1) increasing supply-side flexibility, through retrofitting existing power plants to boost their responsiveness; 2) promoting flexibility from power grids, through building an efficient power grid with inter-provincial and inter-regional transmission capacity to balance spatial mismatch, given that China has a vast territory; 3) encouraging demand flexibility, through demand-response measures to enable demand shifting over time and space to address fluctuations in renewable energy generation; and 4) providing flexibility from energy storage. We consider policies to achieve this, in particular, power market reforms to unlock the flexibility potential of these sources. Regulated electricity prices and lack of auxiliary services markets are major obstacles and we discuss how markets in other countries provide lessons in providing incentives for a more flexible system. • Carbon neutrality requires electrification and intermittent renewables. • Discuss options to improve flexibility in power system with high renewables. • Attention to technology and market policies in system with regulated prices and quotas. • Exploring how markets in other countries may provide lessons for China. [ABSTRACT FROM AUTHOR]

Given that China is committed to peak its carbon dioxide emissions in or before 2030 under the Paris Agreement, promoting renewable energy to substitute coal is one critical solution to facilitate China to meet this commitment. Among various types of renewable energy, solar energy is an attractive choice that will significantly influence the future of energy supply and energy usage. We first provide an overview of the most recent development of solar energy in China, in which the changing pattern from stationary to distributive forms is highlighted. We show that the diversified prices and subsidies across regions may play an important role in the changing pattern. Furthermore, we find major challenges that might impede the future expansion of solar energy. To address these challenges, governments need to propose policies to develop technologies and meditate the benefits of stakeholders, especially grid companies and electricity end-users. Market-based policies are also expected to accelerate the learning-by-doing process through R&D investment, which will help reduce and ultimately eliminate solar subsidies. • An overview of the most recent development of solar energy in China. • A new pattern from stationary to distributive forms of solar energy is highlighted. • Reasons for the changing pattern: Diversified prices and subsidies. • Challenges and policy options for the expansion of China's solar energy. [ABSTRACT FROM AUTHOR]