An Empirical Analysis of Carbon Emission Price in China

Kaile Zhou; Yiwen Li

doi:10.1016/j.egypro.2018.09.196

An Empirical Analysis of Carbon Emission Price in China

Kaile Zhou^*, Yiwen Li

^*Corresponding author for this work

Research output: Chapters, Conference Papers, Creative and Literary Works › RGC 32 - Refereed conference paper (with host publication) › peer-review

20 Citations (Scopus)

21 Downloads (CityUHK Scholars)

Abstract

Carbon emission trading, as an effective economic tool to deal with climate change issues, has received widespread attention in recent years. As a major carbon emitter, China plays an important role in global climate change. This paper uses the Vector Error Correction (VEC) model to explore the dynamic relationship between energy price, macroeconomic indicators, air quality, and carbon emission trading price. The results show that there is a long-term equilibrium relationship between these selected indicators and carbon emission trading price. In addition, this paper also uses the Generalized Auto-Regressive Conditional Heteroskedasticity (GARCH) model to analyze the carbon price fluctuation characteristics. It is found that there is a positive leverage effect on the price fluctuation of the selected carbon emission return series. External bad news will have a greater impact on carbon price fluctuation than good news.

Original language	English
Title of host publication	Applied Energy Symposium and Forum: Low-Carbon Cities and Urban Energy Systems (CUE 2018)
Subtitle of host publication	Cleaner Energy for Cleaner City
Editors	Hongtao Wang, Xin Wang, Jinyue Yan, Jiang Wu, Ying Yang, Hailong Li
Publisher	Elsevier B.V.
Pages	823-828
ISBN (Print)	9781510874558
DOIs	https://doi.org/10.1016/j.egypro.2018.09.196
Publication status	Published - Oct 2018
Event	Applied Energy Symposium and Forum 2018: Low Carbon Cities and Urban Energy Systems (CUE 2018): "Cleaner Energy for Cleaner City” - Shanghai, China Duration: 5 Jun 2018 → 7 Jun 2018 http://applied-energy.org/cue2018/

Publication series

Name	Energy Procedia
Volume	152
ISSN (Print)	1876-6102

Conference

Conference	Applied Energy Symposium and Forum 2018: Low Carbon Cities and Urban Energy Systems (CUE 2018)
Abbreviated title	CUE 2018
Place	China
City	Shanghai
Period	5/06/18 → 7/06/18
Internet address	http://applied-energy.org/cue2018/

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 8 Decent Work and Economic Growth
SDG 13 Climate Action

Research Keywords

Carbon market
Carbon emission trading
GARCH model
Price fluctuation
COINTEGRATION

Publisher's Copyright Statement

This full text is made available under CC-BY-NC-ND 4.0. https://creativecommons.org/licenses/by-nc-nd/4.0/

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10.1016/j.egypro.2018.09.196

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Zhou, K., & Li, Y. (2018). An Empirical Analysis of Carbon Emission Price in China. In H. Wang, X. Wang, J. Yan, J. Wu, Y. Yang, & H. Li (Eds.), Applied Energy Symposium and Forum: Low-Carbon Cities and Urban Energy Systems (CUE 2018): Cleaner Energy for Cleaner City (pp. 823-828). (Energy Procedia; Vol. 152). Elsevier B.V.. https://doi.org/10.1016/j.egypro.2018.09.196

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title = "An Empirical Analysis of Carbon Emission Price in China",

abstract = "Carbon emission trading, as an effective economic tool to deal with climate change issues, has received widespread attention in recent years. As a major carbon emitter, China plays an important role in global climate change. This paper uses the Vector Error Correction (VEC) model to explore the dynamic relationship between energy price, macroeconomic indicators, air quality, and carbon emission trading price. The results show that there is a long-term equilibrium relationship between these selected indicators and carbon emission trading price. In addition, this paper also uses the Generalized Auto-Regressive Conditional Heteroskedasticity (GARCH) model to analyze the carbon price fluctuation characteristics. It is found that there is a positive leverage effect on the price fluctuation of the selected carbon emission return series. External bad news will have a greater impact on carbon price fluctuation than good news. ",

keywords = "Carbon market, Carbon emission trading, GARCH model, Price fluctuation, COINTEGRATION",

author = "Kaile Zhou and Yiwen Li",

year = "2018",

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doi = "10.1016/j.egypro.2018.09.196",

language = "English",

isbn = "9781510874558 ",

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editor = "Hongtao Wang and Xin Wang and Jinyue Yan and Jiang Wu and Ying Yang and Hailong Li",

booktitle = "Applied Energy Symposium and Forum: Low-Carbon Cities and Urban Energy Systems (CUE 2018)",

note = "Applied Energy Symposium and Forum 2018: Low Carbon Cities and Urban Energy Systems (CUE 2018) : {"}Cleaner Energy for Cleaner City”, CUE 2018 ; Conference date: 05-06-2018 Through 07-06-2018",

url = "http://applied-energy.org/cue2018/",

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Zhou, K & Li, Y 2018, An Empirical Analysis of Carbon Emission Price in China. in H Wang, X Wang, J Yan, J Wu, Y Yang & H Li (eds), Applied Energy Symposium and Forum: Low-Carbon Cities and Urban Energy Systems (CUE 2018): Cleaner Energy for Cleaner City. Energy Procedia, vol. 152, Elsevier B.V., pp. 823-828, Applied Energy Symposium and Forum 2018: Low Carbon Cities and Urban Energy Systems (CUE 2018), Shanghai, China, 5/06/18. https://doi.org/10.1016/j.egypro.2018.09.196

An Empirical Analysis of Carbon Emission Price in China. / Zhou, Kaile; Li, Yiwen.
Applied Energy Symposium and Forum: Low-Carbon Cities and Urban Energy Systems (CUE 2018): Cleaner Energy for Cleaner City. ed. / Hongtao Wang; Xin Wang; Jinyue Yan; Jiang Wu; Ying Yang; Hailong Li. Elsevier B.V., 2018. p. 823-828 (Energy Procedia; Vol. 152).

Research output: Chapters, Conference Papers, Creative and Literary Works › RGC 32 - Refereed conference paper (with host publication) › peer-review

TY - GEN

T1 - An Empirical Analysis of Carbon Emission Price in China

AU - Zhou, Kaile

AU - Li, Yiwen

PY - 2018/10

Y1 - 2018/10

N2 - Carbon emission trading, as an effective economic tool to deal with climate change issues, has received widespread attention in recent years. As a major carbon emitter, China plays an important role in global climate change. This paper uses the Vector Error Correction (VEC) model to explore the dynamic relationship between energy price, macroeconomic indicators, air quality, and carbon emission trading price. The results show that there is a long-term equilibrium relationship between these selected indicators and carbon emission trading price. In addition, this paper also uses the Generalized Auto-Regressive Conditional Heteroskedasticity (GARCH) model to analyze the carbon price fluctuation characteristics. It is found that there is a positive leverage effect on the price fluctuation of the selected carbon emission return series. External bad news will have a greater impact on carbon price fluctuation than good news.

AB - Carbon emission trading, as an effective economic tool to deal with climate change issues, has received widespread attention in recent years. As a major carbon emitter, China plays an important role in global climate change. This paper uses the Vector Error Correction (VEC) model to explore the dynamic relationship between energy price, macroeconomic indicators, air quality, and carbon emission trading price. The results show that there is a long-term equilibrium relationship between these selected indicators and carbon emission trading price. In addition, this paper also uses the Generalized Auto-Regressive Conditional Heteroskedasticity (GARCH) model to analyze the carbon price fluctuation characteristics. It is found that there is a positive leverage effect on the price fluctuation of the selected carbon emission return series. External bad news will have a greater impact on carbon price fluctuation than good news.

KW - Carbon market

KW - Carbon emission trading

KW - GARCH model

KW - Price fluctuation

KW - COINTEGRATION

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UR - https://www.scopus.com/record/pubmetrics.uri?eid=2-s2.0-85058224139&origin=recordpag

U2 - 10.1016/j.egypro.2018.09.196

DO - 10.1016/j.egypro.2018.09.196

M3 - RGC 32 - Refereed conference paper (with host publication)

SN - 9781510874558

T3 - Energy Procedia

SP - 823

EP - 828

BT - Applied Energy Symposium and Forum: Low-Carbon Cities and Urban Energy Systems (CUE 2018)

A2 - Wang, Hongtao

A2 - Wang, Xin

A2 - Yan, Jinyue

A2 - Wu, Jiang

A2 - Yang, Ying

A2 - Li, Hailong

PB - Elsevier B.V.

T2 - Applied Energy Symposium and Forum 2018: Low Carbon Cities and Urban Energy Systems (CUE 2018)

Y2 - 5 June 2018 through 7 June 2018

ER -

An Empirical Analysis of Carbon Emission Price in China

Abstract

Publication series

Conference

UN SDGs

Research Keywords

Publisher's Copyright Statement

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