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ORIGINAL RESEARCH
The Impact of Electricity Marketization Reform
on Carbon Emission - A Quasi-Natural Experiment
Based on Electricity Spot Market Construction
1
Innovation, Policy, and Entrepreneur Thrust, Society Hub, The Hong Kong University of Science and Technology
(HKUST), Nansha, Guangzhou 511400, China
2
School of Management Science & Real Estate, Chongqing University, Chongqing, China
3
School of Economics, Henan University, Kaifeng, China
Submission date: 2024-02-27
Final revision date: 2024-07-13
Acceptance date: 2024-09-21
Online publication date: 2024-11-14
Publication date: 2025-11-04
Corresponding author
Pol. J. Environ. Stud. 2025;34(6):7217-7235
KEYWORDS
electricity spot market constructioncarbon emissiongreen innovationeconomic agglomerationdifference-in-differences model
TOPICS
ABSTRACT
The study investigates the effect of electricity market reform on regional carbon emissions and
its underlying mechanism, employing a difference-in-differences (DID) model. Specifically, the
construction of electricity spot markets is treated as a quasi-natural experiment, and panel data from
282 inland municipalities in China spanning 2012-2021 serve as the study's sample. The results of the
study show that the electricity spot market can significantly reduce regional carbon emissions. After
a series of robustness tests, such as the placebo test and the PSM-DID test, the conclusion still holds.
Further analyses show that the mechanism by which the construction of the electricity spot market can
have an impact on regional carbon emissions is that it has an economic agglomeration effect and a
green innovation effect. Heterogeneity suggests that electricity spot market construction has the greatest
impact on the intensity of direct carbon emissions in cities. In regions where the government's lowcarbon
governance is stronger, electricity spot market construction has the greatest impact on the
intensity of urban direct carbon emissions.
CONFLICT OF INTEREST
The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.
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