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Published on: August 13, 2019
Agent based modeling of energy consuming rights trading for low carbon transformation in China
Feng Han1, Xin Li2, Xiaohan Bi3
1Institute of Science and Technology for Development of Shandong, Qilu University of Technology (Shandong Academy of Sciences), Jinan, 250100, China. hanfeng@qlu.edu.cn.
Abstract:
The market-oriented allocation of Energy-Consuming Rights allows enterprises to trade legally obtained energy consumption quotas on public platforms within regional caps, improving energy efficiency and promoting sustainable development. As an institutional innovation, Energy-consuming rights trading (ECRT) addresses China's energy and environmental challenges while fostering green transformation. This study employs agent-based modeling to simulate the dynamic interactions among enterprises, governments, and trading platforms under dual constraints of energy consumption and carbon emissions. The results show that: (1) ECRT reduces total energy consumption by 8.1% and carbon emissions by 9.8% compared to regions without trading markets, demonstrating its effectiveness in energy conservation and emission reduction. (2) Paid quotas outperform free quotas, reducing energy consumption by 7.9% and carbon emissions by 6.8%, while stabilizing trading prices and enhancing market activity. (3) High-quality development scenarios improve energy efficiency by 4.4% and reduce carbon emissions by 5%, aligning better with the "dual-carbon" goals. These findings provide valuable insights for optimizing ECRT mechanisms and advancing green, low-carbon economic transformation. Policy recommendations include refining quota allocation methods, enhancing market participation, and integrating ECRT with carbon trading systems to maximize efficiency.
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