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China's industrial sector generally relies on electricity as its main source of energy, and industrial production can be affected if there are problems with the electricity supply. In order to deal with the uncertain electricity supply and achieve the "dual carbon" target, the industrial sector needs to take effective measures to enhance carbon total factor productivity (CTFP). We use the biennial Luenberger productivity index (BLPI) to try to provide strategies for low-carbon industrial development in China. The results indicate that the overall CTFP of China's industrial sector showed an increasing trend from 2006 to 2019. Technology change was the main contributor to the change in CTFP, but fluctuations in efficiency change remained a challenge. Differences were observed between the light industry sector (LIS) and the heavy industry sector (HIS) in terms of changes in CTFP, with LIS showing more stable changes and HIS experiencing larger fluctuations. Most sub-sectors showed increased CTFP during the sample period. R&D investment and R&D personnel have a positive impact on CTFP, while energy structure is found to hinder CTFP. According to the research results of this study, we offer the corresponding policy implications. This study is the first to explore the balance between low-carbon goals and industrial production from the perspective of improving CTFP, providing a new viewpoint on the contributions of technological innovation to solving socio-economic issues. [ABSTRACT FROM AUTHOR]

• The average carbon reduction performance increases year by year. • The policy has an immediate impact on CO 2 reduction in demonstration cities. • The policy has follow-up impact on carbon emission reduction. • Less thermal power and more research investment are the paths to policy effect. The Energy-saving and Emission Reduction Demonstration City (ESERD) Policy brings more favorable development conditions and opportunities for the cities selected, but the carbon reduction effect of the energy-saving policy is not clear which needs to be quantified and evaluated. By measuring the Total Factor/Energy Carbon Performance Index (TCPI /ECPI) of 286 prefecture-level cities in China from 2003 to 2019 and by constructing a quasi-natural experiment, this paper contributes in three aspects. (1) we are committed to a method of calculating the energy consumption and carbon emission of prefecture-level cities in China; (2) we provide evidence to the CO 2 reduction effect of the ESERD policy in a more comprehensive way; (3) we probe the paths of the policy effects. The main findings are: (1) TCPI and ECPI has been rising since 2011, the eastern cities have more outstanding achievement while the performance of the western region has been at a relatively high level during the time period of the study, and the performance of cities have diverged in recent years. (2) The policy's contribution to the demonstration cities' carbon reduction performance is significant, immediate and far-reaching, a lower share of electricity consumption due to indirectly reducing the use of coal, and higher investment in scientific research for improving the technology level of industrial development are both paths to achieve carbon emission reduction in the demonstration cities. [ABSTRACT FROM AUTHOR]