The carbon tax (CT) is an important climate policy instrument aimed at reducing carbon emissions. Improving energy efficiency is widely recognized as a key strategy for achieving this goal, given its role in cutting emissions, enhancing productivity, and strengthening energy security. Although CTs are intended to promote energy-efficient practices by increasing the cost of emissions, their actual impact can vary: in some cases, they encourage efficiency investments, while in others, they impose financial burdens that hinder improvements. To better understand how a CT influences industrial energy efficiency, this study develops an integrated analytical framework that synthesizes mechanisms identified in previous research, incorporating both direct effects and indirect effects via technological innovation. A panel data analysis of the manufacturing sector is conducted to empirically assess these relationships. The results show that the CT has a significant positive effect on energy efficiency, with changes in energy input composition appearing as a plausible pathway. However, innovation-related channels seem to have limited influence on actual efficiency outcomes. These findings suggest that the CT may also serve to improve energy efficiency under appropriate structural and institutional conditions.
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