The carbon reduction effect of China's national AI innovation pilot zone policy

Artificial intelligence (AI) holds substantial potential for systemic optimization and carbon emission reduction, yet concerns remain over the carbon footprint stemming from its massive energy consumption. Can AI policies deliver net carbon benefits? Using China's staggered establishment of National AI Innovation Pilot Zones (AIPZ) as a quasi-experiment, this study finds the policy reduces urban CO2 emissions by 6.0% on average, via AI-empowered industrial upgrading and green technology innovation. Moreover, there exists significant heterogeneity: emissions have decreased in the Pearl River Delta and increased in the Chengdu-Chongqing region and resource-based cities, though these findings are statistically marginal. Spatial analysis yields a total abatement effect of 15.6% when accounting for spatial interdependence. These findings suggest that AI policies' carbon outcomes depend on regional economic structures, highlighting the need for spatially differentiated governance.