Impact of Electricity Production Tax on China’s Economy, Energy, and Environment: A CGE-Based Study
Yanqin Wang 1  
Zhen Dong 2  
Yong Wang 2  
Guanghui Liu 2  
Hongwei Yang 1  
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State Grid Hebei Economic and Technological Research Institute Co., Ltd, Shijiazhuang, China
State Grid Hebei Electric Power Company Co., Ltd, Shijiazhuang, China
Yanqin Wang   

State Grid Hebei Economic Research Institute, Shijiazhuang 050000, China, State Grid Hebei Economic and Technical Research Institute, Shijiazhuang 050000, Hebei, China, 050000 Shijiazhuang, China
Online publish date: 2018-07-31
Publish date: 2018-11-20
Submission date: 2017-07-11
Final revision date: 2017-12-20
Acceptance date: 2017-12-28
Pol. J. Environ. Stud. 2019;28(1):371–383
The global warming caused by massive energy consumption is one of today’s most serious global environmental problems. CO2 emissions by the electricity industry in China accounted for 10% of global CO2 emissions in 2015. This paper studies the impact of different electricity production taxes on China’s energy, economy, and environment. Nine electricity tax scenarios with different tax rates and a dynamic recursive computable general equilibrium (CGE) model were created to analyze this issue. The results show that sectorial output in the coal industry is most sensitive to the tax, and that raising the electricity tax will directly increase the price of electricity. Moreover, increasing the electricity production tax will be helpful for achieving the goal of economic transformation, and to reduce energy consumption as well as CO2 emissions. The longer the implementation of changing the tax, the lower the cost of emission reduction will be. Therefore, this paper suggests that China can increase the production tax rate of power enterprises moderately in order to reduce energy consumption and adjust the energy structure.