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Dynamic multidimensional optimization of carbon trading mechanisms in energy-intensive industries: Economic modeling, performance evaluation, and policy design.

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Title: Dynamic multidimensional optimization of carbon trading mechanisms in energy-intensive industries: Economic modeling, performance evaluation, and policy design.
Authors: Han, Weihong1 (AUTHOR) yangbill5872@hotmail.com, Wang, Wen1 (AUTHOR) wangwen_914@163.com, Yang, Xinjiletu1 (AUTHOR) bill@imut.edu.cn, Yang, Yanli1 (AUTHOR) 13474918600@139.com
Source: Journal of Cleaner Production. Oct2025, Vol. 527, pN.PAG-N.PAG. 1p.
Subject Terms: *GREENHOUSE gas mitigation, *CARBON offsetting, *ENERGY industries, COMPUTABLE general equilibrium models, RENEWABLE energy transition (Government policy), POLICY sciences, MULTI-objective optimization
Geographic Terms: CHINA
Abstract: Under China's dual carbon strategy, energy-intensive industries are key to achieving national emission reduction goals. However, the current carbon trading mechanism still faces limitations in terms of policy element configuration and synergistic effects, necessitating systematic optimization. In response to this urgent demand, the present study aims to develop a dynamic Computable General Equilibrium (CGE) model to explore how mechanism optimization can effectively facilitate the low-carbon transition of energy-intensive sectors. Based on the 2020 input–output data of 21 sectors, the analysis systematically examines and evaluates the optimization of five key elements of the carbon trading mechanism—sectoral coverage, emission caps, carbon intensity goals, and incentive–penalty policies. Simulation results demonstrate that, under single-policy scenarios, a 2.2 % annual reduction in total emissions combined with a gradual phase-out of free allowances delivers relatively strong mitigation outcomes. Nevertheless, coordinated multi-factor optimization significantly outperforming single-element adjustments. These findings not only validate the effectiveness of multi-factor optimization but also underscore the strategic importance of integrated and systematic policy design in advancing the green transition of energy-intensive industries and ensuring the achievement of China's "dual carbon" goals. • A CGE model evaluates carbon trading optimization to meet China's 'dual carbon' targets. • A 2.2 % emission cap cut and gradual phase-out of free allowances work but have limitations. • Coordinated policy is critical to overcoming industrial emission reduction hurdles. [ABSTRACT FROM AUTHOR]
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Database: Business Source Index
Description
Abstract:Under China's dual carbon strategy, energy-intensive industries are key to achieving national emission reduction goals. However, the current carbon trading mechanism still faces limitations in terms of policy element configuration and synergistic effects, necessitating systematic optimization. In response to this urgent demand, the present study aims to develop a dynamic Computable General Equilibrium (CGE) model to explore how mechanism optimization can effectively facilitate the low-carbon transition of energy-intensive sectors. Based on the 2020 input–output data of 21 sectors, the analysis systematically examines and evaluates the optimization of five key elements of the carbon trading mechanism—sectoral coverage, emission caps, carbon intensity goals, and incentive–penalty policies. Simulation results demonstrate that, under single-policy scenarios, a 2.2 % annual reduction in total emissions combined with a gradual phase-out of free allowances delivers relatively strong mitigation outcomes. Nevertheless, coordinated multi-factor optimization significantly outperforming single-element adjustments. These findings not only validate the effectiveness of multi-factor optimization but also underscore the strategic importance of integrated and systematic policy design in advancing the green transition of energy-intensive industries and ensuring the achievement of China's "dual carbon" goals. • A CGE model evaluates carbon trading optimization to meet China's 'dual carbon' targets. • A 2.2 % emission cap cut and gradual phase-out of free allowances work but have limitations. • Coordinated policy is critical to overcoming industrial emission reduction hurdles. [ABSTRACT FROM AUTHOR]
ISSN:09596526
DOI:10.1016/j.jclepro.2025.146701