What drives carbon emissions reduction in Beijing? An empirical study based on SDA and SPD

Abstract

A large number of studies have been conducted to examine China’s CO₂ emissions problem disaggregated to the city level. However, few studies have delved further into the black box of economic production to examine the characteristics of CO₂ emissions at the city supply chain level. In the context of the reality that Beijing takes the lead in achieving CO₂ emissions reduction, this study decomposes CO₂ emissions change in Beijing at three levels: overall, supply stage, and supply chain, using structural decomposition analysis (SDA) and structural path decomposition (SPD), filling the gap in urban CO₂ emissions studies. The results show that: (i) energy consumption intensity is the most significant driver of emissions reduction, while per capita final demand is the largest factor in increasing emissions; (ii) Beijing’s emissions reduction contribution is mainly reflected in the first supply stage (76.50%) and the second supply stage (18.85%); (iii) the expansion of domestic exports and thus greater demand for transportation is significant in emissions increase supply chains; (iv) the improvement of the demand structure for electricity from domestic exports contributes a large part in emissions reduction supply chains; (v) the existence of many offsetting effects, such as the ebb and flow of domestic exports on the demand for different products, has led to the loss of emissions reduction. Finally, corresponding policy recommendations are presented from the energy, industry, and demand perspectives. Our study will provide assistance in developing more microscopic policies to reduce emissions and replicating the Beijing experience.