The impact of carbon emission trading pilot policy on China’s energy eco-efficiency

Under the "Dual Carbon" goals (carbon peaking and carbon neutrality), China's Carbon Emissions Trading System (CETS) represents a key policy tool in addressing climate change, significantly contributing to carbon reduction and the enhancement of Energy Eco-Efficiency (EEE). As a comprehensive measure of coordination within the "energy-economy-environment" system, EEE effectively captures a country's or region's ability to harmonize energy consumption, green and sustainable development, and environmental protection. This study computes the EEE index using the SBM model and examines how a carbon emission trading pilot policy (CETPP) affects EEE in China and its spatial spillover by employing a difference-in-differences (DID) model and spatial econometric model. The results indicate that CETPP implementation significantly enhances regional EEE and advances China's green and low-carbon transition process by improving the balance between economic and environmental goals, increasing employment, diversifying the energy supply, and strengthening economic resilience. Mechanistic research reveals that the CETPP promotes the improvement of EEE by reducing pollution emission intensity and that regional innovation ability can enhance the positive impact of the CETPP on regional EEE. Further analysis revealed significant endogenous spatial interactions in EEE across Chinese regions. However, EEE in the eastern and western regions can create a "siphon" effect on production factors that hinders development in neighbouring areas. Implementing a CETPP in a region not only advances local EEE but also stimulates EEE improvements in adjacent areas, with the strongest spillover effect observed in eastern China. To this end, it is essential to enhance the management of carbon dioxide emissions, actively advance the establishment of carbon trading markets. Moreover, region-specific measures should be implemented to promote the coordinated improvement of regional EEE.