Environmental regulation and bioenergy production: a case study of China’s pig farms

Transforming livestock waste into bioenergy represents a critical pathway for the circular economy, simultaneously addressing environmental pollution and fostering the clean energy transition. This aligns with the global goal of integrating economy, energy, and environment, particularly in developing nations. Utilizing a unique micro-level panel dataset of pig farms in China, this study employs Multinomial Logit and Tobit models to empirically evaluate the impacts of environmental regulations and government subsidies on bioenergy production. Our results indicate distinct policy mechanisms: First, zoning regulations that aim to prohibit or restrict livestock breeding in specific areas exert no significant influence on the utilization of manure for energy recovery. Second, environmental inspections by local governments serve as a potent driver, effectively compelling pig farms to invest in energy equipment and promoting bioenergy production. Third, while government subsidies provide incentives for adoption, they also lead to lower bioenergy utilization efficiency within farms. Although subsidies stimulate production, they entail high fiscal costs without guaranteeing optimal energy performance. These findings challenge the reliance on financial incentives alone and suggest that strict enforcement is vital for achieving a win-win situation. This study provides critical knowledge on designing and reforming livestock waste management and renewable energy policy.