Role of economic structural change in the peaking of China's CO₂ emissions: An input-output optimization model

To combat climate change, the Chinese government has announced that the country will reach its national carbon emission peak within 2030. Various scenario studies suggest that technological advances in energy, such as energy efficiency and renewables, would be the leading determining factors for the peak in China's carbon emissions. However, most of these studies have failed to reflect the fact that China is shifting its economy from energy-intensive industries to non-energy-intensive industries, which may play a vital role in mitigating carbon emissions. To assess how economic structural changes may contribute to carbon emissions, an input-output optimization model was constructed and scenario analyses were performed. This model introduced the input-output model integrated with an optimization model to ensure the balance of economic structure in an optimal result. The results show that in 2030, China could peak its carbon emissions at 12.41 Gt CO₂eq (parts per giga ton; carbon dioxide equivalent) by adjusting its energy-intensive economic structure of which the key sectors are coke refined petroleum and nuclear fuel (C8), chemicals and chemical products (C9), other nonmetallic minerals (C11), basic and fabricated metals (C12), and electricity gas and water supply (C17). The continuous increase in the added value of the tertiary industry could maintain a high GDP growth rate of 5.6% when the secondary industry is restricted to reduce carbon emissions. Accelerating the pace of China's economic transformation will be very conducive to an earlier realization of peaking CO₂ emissions because the inhibition effect of structural change on carbon emissions presents an increasing marginal trend. From a policy perspective, the analytical techniques in this study could provide valuable information for decision-makers to regulate sector capital investment and formulate practical industrial policies with implications for CO₂ emissions.