Problem Statement and Purpose
Energy is an important component of national economy and is vital to national economic development. The key to guarantee energy system operating well lies in enhancing the resilience of the energy system so that it can quickly recover and adapt when faced with the risk of perturbation.
The market is the link between production and consumption, and market-oriented reform as a means to make full use of market competition and price discovery mechanisms to regulate supply and demand, allocate resources and force innovation can effectively optimize the system structure and improve the resilience of the energy system.
As a representative of market-oriented reform, the carbon emissions trading market is a systematic innovation that uses carbon emission rights as the subject of trading, and applies market mechanisms to promote emission reduction by participating enterprises and the green and low-carbon transformation of society.
Therefore, this paper investigates whether and how market-oriented reform impacts the resilience of energy system.
Methodology
This paper constructs an index system based on the concept of energy system resilience, measures the energy system resilience scores of 30 provinces and cities in China from 2004 to 2020 using the EWM-TOPSIS method, and examines the impact of the carbon emissions trading market on the resilience of the regional energy system by using the Time-varying DID method.
We construct the following benchmark regression model(1):
ER_Score𝑖𝑡= α+βCBM𝑖𝑡+θ𝐗it+μi+γt+εit (1)
where ER_Score𝑖𝑡 is the dependent variable, representing the energy system resilience of provinces or cities i in year t. CBMit is the independent variable, which Indicates whether carbon emissions trading market will be launched. In this paper, we select the keywords related to energy system resilience to mitigate the problem of other interfering factors and omitted variables. 𝐗it are control variables, including industrial structure, level of economic development, climate change (rainfall and temperature), share of state-owned economy, level of marketization.
We also construct the following mediation effect model (2):
Media_Var𝑖𝑡=α+aCBM𝑖𝑡+θ𝐗it+μi+γt+εit (2)
Where Media_Var𝑖𝑡 is a mediator variable,Replace with four variables that reflect energy investment, energy efficiency, green finance, and green technology innovation in sequence. The remaining variables are defined the same as in model (1).
Findings
1.The results of model (1) confirm that market-oriented reform has a positive effect on energy system resilience. The positive effect continues to be emphasized from the second year after the start of the pilot. Compared with non-pilot regions, the carbon emissions trading market increased the energy system resilience of pilot regions by 1.10%.
2.The results of model (2) show that carbon emissions trading market plays a role in enhancing the resilience of the energy system through four main channels: improving energy investment, energy efficiency, promoting green financial development and green technological innovation.
Proposals
This paper proposes that, firstly, to deepen the market-oriented reform in the energy sector and expand the capacity of the national carbon market. We will deepen market-oriented reforms in key energy sectors and key links, ensure the continuity of energy market-oriented reforms, and release long-term policy dividends. Secondly, to unblock the channels of action and taking multiple measures to improve the resilience of regional energy system.
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