How to achieve the first step of the carbon-neutrality 2060 target in China: The coal substitution perspective

Nowadays, coal consumption is still dominated in China's energy structure, while China aggressively wants to achieve the goal of carbon neutrality in 2060. The substitution of coal consumption will be the first step to the goal. This paper simulates the scenarios of coal resource tax and investment in renewables by applying China Energy-Environment-Economy Analysis (CEEEA/CGE) model. The simulation results show the different mechanisms between the tax and the investment. In general, the impact of coal resource tax comes relatively early and is an effective way to reduce coal consumption in the short term. Renewable energy investment is a long-term, slow, and fundamental way to substitute coal consumption. However, for a long time, renewable energy should be the main driving force of carbon emission reduction. Consequently, we suggest that the process of coal substitution can be carried out through the way of tax priority in the early stage and investment in the later stage. (c) 2021 Elsevier Ltd. All rights reserved.

Automated summary

The paper discusses the importance of coal substitution in achieving carbon neutrality in China, and simulations show the different roles and mechanisms of coal resource tax and renewable energy investment in coal substitution. It suggests a strategy of tax priority in the early stage and investment in the later stage.