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Guiding industries to produce in an effective and environmentally sustainable manner has become a key issue for governments around the world. Over the past 15 years, series of regional and industrial development policies have been introduced by the Chinese government. This has influenced the geographical distribution and energy efficiency performance of China’s industries. This paper quantifies the influence of enterprises geographical distribution on energy efficiency improvement in the paper industry and aims at providing some helpful suggestions on industrial development to policy makers. The main results show that, firstly, the paper industry in eastern China shows obvious characteristic of agglomeration. The average location quotient is 1.2278. However, following the industrial and regional development policies, the characteristic of agglomeration is weakening. Secondly, only when agglomeration reaches a certain level (location quotient is above 0.5447) will industrial agglomeration positively impact on industrial energy efficiency improvement (a 1% increase in agglomeration will increase dynamic energy efficiency by at least 0.23%). Thirdly, the regional development policies carried out by the government slow the pace of energy efficiency improvement in China’s paper industry. The empirical results indicate that the government needs to consider regional characteristics and consciously guide industrial enterprises to concentrate in the dominant area. [ABSTRACT FROM AUTHOR]

China’s paper industry consumes a lot of energy and emits huge amounts of pollutions. The Chinese government over the past decades has done a lot to promote energy efficiency of the industry. This paper studies the impact of industrial polices to improve energy efficiency. The energy efficiency change is firstly studied under a framework of total factor efficiency. On this basis, different econometric models are built to discuss the detailed energy efficiency characteristics of the paper industry. The main results are as follow: (i) ownership structure did influence the energy efficiency, but the influence is different in different conditions; (ii) energy efficiency of the paper industry can be improved by economies of scale; (iii) market competition can to some extent overcome the motivation and supervision problem that often occur in state-owned companies; (iv) energy price cannot play the role of resource allocation well in China. Finally, based on our findings, some suggestions are provided. [ABSTRACT FROM AUTHOR]

The papermaking industry has developed rapidly in recent years in China. Papermaking is a high-energy-consuming process. Consequently, large-scale paper mills usually have cogeneration systems that supply both electricity and steam for the papermaking process. In China, almost all these cogeneration systems in paper mills are powered by coal combustion, which consumes a large amount of energy and emits large amounts of greenhouse gas. The Integrated Gasification Combined Cycle (IGCC) technology is regarded as a clean and efficient method of coal utilization. In this work, an IGCC process for application in paper mills was designed and modeled. An IGCC coupled with a cascade refrigeration process (CRP) was further proposed in order to reuse the waste heat from the dryer section and improve the energy efficiency of the papermaking process. A paper with a conventional cogeneration system, one with an IGCC cogeneration system, and one with an IGCC coupled with a CRP cogeneration system were analyzed and compared in terms of energy efficiency, capital investment, operational cost, and dynamic payback period. The results showed that the integration of IGCC technology allows paper mills to be more competitive than those featuring conventional cogeneration systems in terms of energy efficiency and operational cost. [ABSTRACT FROM AUTHOR]

China's paper industry accounts for a larger proportion of the global paper industry and consumes large amounts of energy. Energy conservation and pollution reduction of the industry have become the focus of China's national development strategy. Energy efficiency is an important index which directly determines the amounts of energy consumption and pollution emissions. To understand the energy efficiency evolution of China's paper industry, this paper establishes an input-output data of the paper industry for 29 provinces in China and applies DEA method and econometric models to estimate and comprehensively discuss the energy efficiency issues based on the framework of total factor efficiency. Our results indicate that China's paper industry has a large energy saving potential even though its energy efficiency has improved during the period 1990–2013. The saving potential is about 65% under the meta-frontier and 44% under the group-frontier. Moreover, there are significant differences between different regions in production technology and energy efficiency. The performance of eastern China is better than other regions. But the technology gaps between the different regions are shrinking and converging over time. Finally, some policy recommendations are proposed to improve the energy efficiency of the industry. [ABSTRACT FROM AUTHOR]

China has become the world largest paper and paperboard producer. However, pulp and paper industry has involved high resource consumption and severe pollution especially for water. This research has assessed the eco-efficiency of China's pulp and paper industry at the national level and provincial level. An overview regarding the cleaner production of China's pulp and paper industry was presented to reveal the measures for reducing environmental impact in the last two decades. Slacks-based measure was used to analyze the efficiency levels of 16 provinces' pulp and paper industries. To uncover the underlying causes of eco-efficiency performance, Malmquist–Luenberger index was calculated to discover the drivers of productivity growth of pulp and paper industries. Our results showed that the pollution treatment of China's pulp and paper industry has made progress in terms of water consumption and water pollution, although the absolute amount of pollution discharge is still large. Chemical oxygen demand emissions are still the first critical influencing factor of pulp and paper industry's inefficiency. Furthermore, efficiency progress was the dominating contribution of the industry's productivity growth between 2010 and 2013. The policies for adjusting the industrial structure of pulp and paper industry have resulted in the scale effects through eliminating backward production capacity and accelerating merger and acquisitions. Moreover, the productivity of pulp and paper industry was underestimated when the undesirable outputs were ignored. It indicates that the stricter environmental regulations have positive effects on paper companies to internalize environmental pressures in the production activities through environmental management. In the future, pulp and paper companies should further internalize the cost of pollution treatment through scale effects and technology improvement. [ABSTRACT FROM AUTHOR]

As a traditional energy and carbon intensive sector, it becomes imperative for the global paper industry to realize green development. This paper aims to provide guidance for the green transformation of global paper industry by evaluating the global paper industry green development level in a systematic and dynamic way. This paper employs text-mining method to develop paper industry green development evaluation indicator system and adopts market-extended LCA model and entropy-TOPSIS method to calculate the paper industry green development level of 48 countries/regions. The results show that during 2000–2030 the paper industry green development level of developing countries improves faster than developed countries, where those of developing and developed countries increase from 0.3369 to 0.3938 and from 0.5120 to 0.5517 respectively and the gap between them narrows from 0.1751 to 0.1579. The comparative analysis reveals that the paper industries of developed and developing countries are in different green development stages. Developing countries, represented by China, improve greatly in economic and social dimensions, but decline seriously in ecological dimension due to enlarging resource consumption and environmental damages. On the contrary, developed countries tend to saturate in economic and social dimensions and have been improving fast in ecological dimension, gradually realizing the decoupling of industrial economic development and environmental damages. To further promote the global paper industry green development, developing countries should focus on promoting the coordinated development between economic growth and environment protection and developed countries should play a leading role in the global green transformation by promoting optimal allocation of resources and cross-regional communications of green technologies. • A paper industry green development indicator system is developed based on text mining. • A global paper industry green development model is built with market-extended LCA. • Complex interactions among the indicators are internalized in the evaluation. • A spatial-temporal analysis is performed on global paper industry green development level. [ABSTRACT FROM AUTHOR]

As a traditional energy and carbon intensive sector, it becomes imperative for the global paper industry to realize green development. This paper aims to provide guidance for the green transformation of global paper industry by evaluating the global paper industry green development level in a systematic and dynamic way. This paper employs text-mining method to develop paper industry green development evaluation indicator system and adopts market-extended LCA model and entropy-TOPSIS method to calculate the paper industry green development level of 48 countries/regions. The results show that during 2000–2030 the paper industry green development level of developing countries improves faster than developed countries, where those of developing and developed countries increase from 0.3369 to 0.3938 and from 0.5120 to 0.5517 respectively and the gap between them narrows from 0.1751 to 0.1579. The comparative analysis reveals that the paper industries of developed and developing countries are in different green development stages. Developing countries, represented by China, improve greatly in economic and social dimensions, but decline seriously in ecological dimension due to enlarging resource consumption and environmental damages. On the contrary, developed countries tend to saturate in economic and social dimensions and have been improving fast in ecological dimension, gradually realizing the decoupling of industrial economic development and environmental damages. To further promote the global paper industry green development, developing countries should focus on promoting the coordinated development between economic growth and environment protection and developed countries should play a leading role in the global green transformation by promoting optimal allocation of resources and cross-regional communications of green technologies. • A paper industry green development indicator system is developed based on text mining. • A global paper industry green development model is built with market-extended LCA. • Complex interactions among the indicators are internalized in the evaluation. • A spatial-temporal analysis is performed on global paper industry green development level. [ABSTRACT FROM AUTHOR]

Straw pulp in China, which is the world's largest producer of this material, suffers from water and energy shortages during its entire life cycle. However, limited systematic studies have focused on these issues, and decision makers need be provided with improvement methods for the environmental performance. Thus, an impact-oriented energy and carbon coupled water footprint analysis was conducted in this study based on ISO standards. Results showed that the impact of energy consumption and carbon emissions exceeded that of water footprint. Carcinogens, non-carcinogens, and freshwater ecotoxicity also played effective roles in improving the environmental performance. Optimizing key indirect processes, including chemicals production, steam preparation, electricity generation, wood pulping, and fertilizer recovery, dominated the reduction in environmental burdens. Direct freshwater consumption and wastewater disposal played additional effective roles in controlling water footprint. The water network was thus optimized by a water pinch analysis to decrease the freshwater consumption and pollutant emissions by maximum values of 91.5% and 99.7% after optimization, respectively. Meanwhile, carbon dioxide, methane, chromium, arsenic, mercury, titanium, copper, strontium, total nitrogen, total phosphorus, BOD 5 , and COD were the main pollutants. Overall, the environmental impact can be further reduced by diminishing coal power ratio in national energy structure, adopting recovered steam, and considering multistage regeneration water network to cope with different water use demands. • LCA-based energy and carbon coupled water footprint of straw pulp paper was applied. • Optimizing water network by water pinch method gained marked environmental benefit. • Electricity, steam, and chemicals exerted high impact among all inputs considered. • CO 2 , CH 4 , heavy metals, coal, and water were key contributors to footprint impact. • Improving national energy structure and adopting recovered steam were recommended. [ABSTRACT FROM AUTHOR]

Recovered paper is one of the major raw material for recycled papermaking industry. In China, the domestic recovered paper recycling system is incomplete and the amount of recyclable recovered paper cannot satisfy the papermaking demand. Therefore, the recycled papermaking industry is extremely dependent on imported recovered paper as their raw fiber source. In 2018, Chinese government announced a ban on unsorted recovered paper and tightened the import quota for recovered paper, which resulted in a dramatic drop in the importing amount of recovered paper. It is an urgent issue to explore alternative production routes that are more economical and environmentally friendly. Herein, life cycle cost assessment is used to compare and analyze the recycled papermaking industry based domestic recovered paper and three alternatives (including straw, imported deinked pulp and imported wood pulp) as the raw materials. The results show that the life cycle cost of domestic recycled paper based recovered papermaking is significantly lower than the other three alternatives, whereas its external cost is higher than that of the production routes based on the imported deinked pulp and imported wood pulp. With the increasing price of the domestic recovered paper, imported deinked pulp is the trend of recycled papermaking industry in China. • Life cycle cost assessment is applied to the recycled paper industry in China. • LCC of four papermaking schemes based on different raw materials were assessed. • LCC for six types of paper products ranges from 924 to 1227 USD/t in 2017. • Imported recovered pulpboard is the best choice of wastepaper material supplement. [ABSTRACT FROM AUTHOR]

To reduce energy use and achieve a low carbon production in pulp and paper industry (PPI), it is essential to improve energy efficiency in pulp and paper production. In this study, the energy savings from the PPI were estimated based on a techno-economic analysis by EAGER tool for PPI at the factory level. The structure and implement procedure were introduced initially. Two typical pulp and paper mills from China were determined to estimate the impact of selected energy efficiency technologies (EETs) on energy savings as the cases in the base year. One Factory (A) only produced paper products (i.e. corrugated paper and Kraft linerboard) while the other Factory (B) also produced market pulp besides sack paper. In totally 22 selected EETs were applied to assess their saving potential in Factory A, and 29 measures were applied in Factory B. The results show that 2290 TJ and 1179 TJ of final energy could be saved annually in Factory A and B, corresponding to reduction of 29.4% and 13.6% total energy consumption respectively for the case factories. The CO 2 reduction potential was 32.3% for Factory A compared with that of 16.6% in Factory B. It suggests that the pulp and paper mills should encouraged to use this method estimating energy saving potential, and improve their energy efficiency with suggested measures in order to reduce energy consumption and related carbon emissions further in the coming years. • Energy savings of pulp and paper production were estimated at the factory level. • A techno-economic evaluation tool was applied to access the energy savings and carbon emission reductions. • Two typical pulp and paper factories from China were investigated to estimate their energy savings in the base year. • It is useful to assess energy savings and select feasible EETs in achieving energy saving and emission reduction targets. [ABSTRACT FROM AUTHOR]

Papermaking is a water intensive industry. The growth of paper demand will further intensify the need of fresh water resources. Papermaking involves complex processing routes. Previous investigations of water consumption in papermaking industry have focused primarily on key processes and pathways, ignoring the impacts of many intermediate and inter-related processes in paper production cycles and there underestimating the sustainability impacts. Herein, the results of a life cycle analysis of water consumption for papermaking industry in China using an extensive system boundary that includes the water embedded in intermediate processing are presented. The results show the life cycle water consumption and water saving potentials for different papermaking pathways. The advocacy of "forest pulp and paper integration" may have few practical contribution to reducing water consumption due to the low indirect water consumption of raw materials and energy for transportation. [ABSTRACT FROM AUTHOR]

The continuing increase of the popularity of mobile phones generates a large volume of waste mobile phones. The efficient collection of this waste has become a focus and frontier of both academic research and related business. This paper reviews the waste mobile phone collection in Dalian, China. The findings show that several challenges currently impede the implementation of collection, including unsmooth collection channels, poor convenience, and low environmental awareness of residents. A new joint collection mode is put forward to increase the waste mobile phone collection rate. In the mode, the responsibilities of each stakeholder (including the collecting enterprise, the third-party logistics company, the government, and the resident) are clarified. Moreover, a conjoint analysis method is applied to identify residents' willingness for collection. The obtained results show that compensation mode, collection price, and convenience degree are the three factors that influence the prevailing preferences of residents. Collection services with high market share must satisfy the concourse of three conditions. The collection price exceeds 30% of the mobile phone's original price, the compensation mode is cash and information service is provided. These results can provide a reference for the service design of collection mode and the formulation of relevant corporate strategies. • Waste mobile phones are an environmental problem if not handled appropriately. • Collection is the critical bottleneck of waste mobile phones managements. • A new joint collection mode aiming at increasing collection rate was put forward. • Conjoint analysis was applied to investigate residents' willingness for collection. [ABSTRACT FROM AUTHOR]

Abstract: There has been much debate on the topic of whether stricter environmental regulations can promote environmental performance and economic performance at the same time. Different researchers have used different indicators to measure environmental performance and economic performance in their empirical studies. However, it is a surprise that few studies have checked the relationship between environmental regulation and eco-efficiency, as the latter is widely regarded as a quite powerful tool of considering ecology and economy together. In this study the background is the implementation in 2003 of the Stricter Discharge Standard (SDS) in Shandong Province’s Pulp and Paper Industry (SPPI), compared to the national standards of China. The stricter regulations were intended to promote corporate change from passive management to active control and from end-of-pipe treatment to cleaner production. This study investigated the eco-efficiency trends of SPPI from 2001 to 2008 in three fields: water efficiency, energy efficiency and environment efficiency. A “de-linking” and “re-linking” tool was used to attain a further evaluation. The study showed that with the implementation of stricter regulation most of the efficiency indicators (except CO2 emission and energy consumption) had achieved significant improvements, and the overall environmental performance trends of SPPI showed it to be more sustainable. However, the study also found that it was not enough to address a single indicator in the environmental regulation of the pulp and paper industry. More holistic eco-efficiency indicators need to be further considered and introduced to the industry as the next step to create true sustainable development. [ABSTRACT FROM AUTHOR]

As China's ecological environmental problem becomes severe, corporate environmental behavior (CEB) has become the focus of a range of stakeholders, policy makers and the whole society since the operating activities of companies is the main source of environmental pollution. This study used a questionnaire survey and structural equation model (SEM) to examine the relative importance of external and internal pressures (EIP) on driving CEB. Data was obtained from 702 papermaking companies in China. The mechanism of EIP effects on CEB was tested employing SEM through path analysis, using AMOS 21.0. The results showed that government pressure, economic pressure and internal pressure played significant positive roles in environmental behavior of papermaking companies in China. Economic pressure was the most important factor on environmental behaviors (including defensive, accommodative and proactive behaviors) of papermaking companies. Furthermore, the role of internal pressure on CEB (defensive and proactive) was second only to economic pressure, while the role of government pressure on CEB was much weaker than our expectation. However, the role of social pressure, which was imposed by general public and environmental Non-Governmental Organizations (NGOs), was not significant. Thus, policy makers should emphasize on the interactions of economic mechanism, government regulation and internal incentive mechanism to stimulate firms to adopt active environmental behavior. More concerns from the general public shall be addressed to enhance their driving effect on CEB in Chinese papermaking industry. [ABSTRACT FROM AUTHOR]

Solid waste recycling in developing countries has been largely relying on the informal recycling sector which intelligently uses the tacit knowledge within the hierarchical network of labor division to capture the value from the geographically uneven distribution of waste generation and demands on secondary materials. Previous studies on solid waste recycling mainly have a material-centric view on economic value. In this paper, an entropy-weighted recyclability index (EWRI) is developed to quantify the recyclability of Municipal Solid Waste (MSW) in China at the prefectural city level by integrating the road transportation density and regional recycling capability into the categories of waste physical components regarding the cost to deliver the waste from generating sources to the conversion sites for recycling. The result confirms the existence of an east-west gradient regional disparity in recyclability of Municipal Solid Waste (MSW) among cities for the recyclable components. The 339 prefectural cities were classified into 4 grades, namely "best, good, normal, and difficult" for the recyclability of local MSW with guidelines for planning of regional recycling infrastructure, respectively. In conclusion, general guidelines for the building of wise-waste city infrastructure to fit the local context in developing countries is advised. [ABSTRACT FROM AUTHOR]

The current approaches to study the coupling mechanism between economy and environment seem to fall into self-circulation, failed to reveal "economy–environment interdependence". In this context, an exogenous variable is introduced into these models for better understanding the relationship. Benzo[a]pyrene (Bap) environment inventories in different cities in China were estimated by fugacity model based on Bap concentration data collected from previous studies. An extended model, stochastic impacts by regression on population, affluence and technology (STIRPAT), generated from original IPAT (a model that expresses the idea that environmental impact (I) is the product of three factors: population (P), affluence (A) and technology (T)) was used to study the relationship between Bap environment inventory and anthropogenic factors including population, vehicle amount, affluence and energy consumption. A ridge regression has been applied to optimize the model parameters. Overall, there exist good relationships between Bap inventories and economic factors. Specifically, population and affluence are the most significant factors that influence Bap inventory. Rise of the scale of population and vehicle amount increases the Bap inventory, as growth of GDP per capita and the efficiency of energy utilization have inhibitory effect on Bap inventory. Apparently, the influences of anthropogenic factors on Bap inventory are different between north and south China. Bap inventory in north China is more sensitive to the change of population and energy consumption, while is highly correlated to GDP per capita in south China. Further, according to social-economic development prediction, with assist of the result from STIRPAT model, we find out that Bap inventory drop 31% from 2001 to 2020 in China. Our estimates are comparable with the published data and confirmed that Bap can be regarded as a chemical indicator of social-economic development in China. Image 1 • An extended STIRPAT model derived from original IPAT was developed. • Population and affluence are the key factors that influence Bap inventory. • Advance of affluence and technology level curbs Bap environmental exposure. • We predict Bap environmental inventory drop 31% from 2001 to 2020 in China. • Bap can be used as an indicator of social-economic development in China. [ABSTRACT FROM AUTHOR]

The mechanism of the environmental regulations affecting carbon emissions is complex, and for many years it has been a hot research topic for researchers. However, few of the previous studies have focused on whether or not environmental regulations can potentially influence carbon emissions through technical efficiency. Therefore, the present study chose to investigate the mediation effects of the technical efficiencies between environmental regulations and carbon emissions using the provincial panel data of energy-intensive industries for the period ranging from 2005 to 2015. The results were as follows: (i) In regard to the entire group of energy-intensive industries, it was found that environmental regulations could not only potentially directly reduce carbon emissions, but also indirectly reduce carbon emissions through technical efficiency. In other words, technical efficiency had played a partial mediation role between the environmental regulations and the carbon emissions; (ii) It was observed that for the different subdivided energy-intensive industries, the different levels of technical efficiency had shown various mediation effects. For example, the mediation effects of technical efficiency in the petroleum processing and coking (PPC) industry; papermaking and paper products (PPP) industry, and raw chemical materials and chemical products (RCMCP) industry, were found to be similar to those of the whole energy-intensive industries. Furthermore, the "Porter Hypothesis" had been verified in the nonmetal mineral products (NMP) industry. However, there were no mediation effects observed in the smelting and pressing of ferrous metals (SPFM) and smelting and pressing of nonferrous metals (SPNM) industries; (iii) In this study, in accordance with the regression results of the double-threshold models, it was found that for the energy-intensive industries as a whole, the carbon emission reduction effects of environmental regulations had become stronger with the increases in technical efficiency. For the PPP and RCMCP industries, there was an inverted U-shaped relationship observed between environmental regulations and carbon emissions when the technical efficiency was taken as the threshold variable. Therefore, based on the research conclusions achieved in this study, some policy recommendations were put forward. • Environmental regulation reduces carbon emission of the energy intensive industries of China. • Technical efficiency plays a partial mediation effect between environmental regulation and carbon emission. • The mediation effects of technical efficiency differ in the subdivided energy-intensive industries. • The "Porter hypothesis" is verified in Nonmetal Mineral Products (NMP) industry. [ABSTRACT FROM AUTHOR]

Based on the complex network of industry space, this paper investigates the industry structure optimization in Jiangxi Province in China. For the prefecture-level cities in Jiangxi Province, the location quotient is applied to obtain the specialized sub-industries. The conditional probability is used to analyze the interdependencies between industries. The complex network of industry space is presented to illustrate the relatedness among industries and analyze the space and structure of the regional overall industry. The index of transitional potential is proposed to measure the potential of a non-specialized industry which will become a specialized one in the future. The transformation difficulty index of industry is obtained to analyze the difficulty level of the transformation of the original specialized industry set to a new specialized one of a city. The results show that more industries have positive than negative interdependencies with one another in Jiangxi Province; rare industries specialize in cities at higher-level GDP, and common industries dominate the cities at lower-level GDP; it is more difficult for rarer non-specialized industries to become specialized ones, more common non-specialized industries can become specialized ones more easily, and the cities with higher GDP can transform industries more easily. By discussing the industries that have positive interdependencies with existing specialized industries, the detailed direction of industry structure optimization is analyzed. Finally, the policy implications are proposed, and these can be applied to other developing countries. • The conditional probability is used to analyze the interdependencies between industries. • The complex network of industry space is presented to illustrate the relatedness among industries. • The index of transitional potential is used to measure the potential of a non-specialized industry becoming specialized. • The transformation difficulty index is the difficulty level of the transformation of the originally specialized industry. • The industry structure can be optimized by developing the industries that have positive interdependencies with existing specialized industries. [ABSTRACT FROM AUTHOR]

Straw pulping plays a vital role in virgin pulp supply and regional agricultural residue utilization. However, a significant decrease in its production has been observed. From an environmental perspective, why has there been a sharp decrease in straw pulping? Are there any innovations in straw pulp production that alleviate the heavy environmental burdens of straw pulping? In this study, factors contributing to the decrease in straw pulp are examined. An innovative technique to produce straw pulp is introduced and its environmental performance is analyzed and compared with conventional pulping. The results show that the main reasons contributing to the environmental burdens of straw pulping lie in the difficulties in black liquor extraction and alkaline recovery for the black liquor. Technical processes are changed in the innovative technique of straw pulping through using a rapid displacement cooking process, converting black liquor into fertilizers, utilizing total chlorine-free bleaching, etc. The new technique (Case B) achieves superior environmental performance than that of the conventional technique (Case A) from a carbon metabolism perspective. Specifically, 1022.90 kg and 857.80 kg of biogenic-carbon (bio-carbon), and 594.32 kg and 628.13 kg of fossil-carbon are needed to make 1 ton of bleached straw pulp for Case A and Case B, respectively. The carbon efficiencies for Case A, Case B (when pulp is the only desired product) and Case B (when including other products) are 39.10%, 46.63% and 92.21%, respectively. The carbon factors for Case A, Case B (when pulp is the only desired product) and Case B (when including other products) are 3.66, 3.60 and 1.86 kg CO 2 -eq, respectively. In addition, the corresponding E factors, which reflect the waste generation level, are 3.20, 2.69, and 1.39 kg, respectively. The new technique for straw pulping, which follows the principle of a circular economy by fully utilizing resources and reducing the generation of waste, achieves both economic and environmental benefits. It is a promising technique for straw pulping. [ABSTRACT FROM AUTHOR]

Carbon trading is widely used as a carbon finance instrument to promote green transformation. This paper focuses on carbon trading's impact on the bond spread for high-carbon enterprises. Using variation in carbon trading access due to pilot policies in China, we find that bonds issued by high-carbon enterprises participating in the carbon trading pilots have lower spreads. Furthermore, the results suggest that carbon trading reduces bond spreads by encouraging high-carbon enterprises to improve their environmental performance. Another channel is the information asymmetry between bondholders and enterprises. More active carbon markets provide investors with more information about enterprises' motivations for reducing carbon emissions, leading to a greater reduction in bond spreads. In addition, the impact of carbon trading is more significant in local SOEs, high-innovation enterprises, and longer-term bonds. Our research helps us understand the importance of carbon trading in achieving a low-carbon economy. [ABSTRACT FROM AUTHOR]