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As the world's greatest energy consumer, China's energy consumption and transition have become a focus of attention. The most significant location for regional integration in the north of China is the Beijing-Tianjin-Hebei region, where the industrial sector dominates its energy consumption. Forecasting the energy demand and structure of industrial sectors in China's Beijing-Tianjin-Hebei region may help to promote the energy transition and CO2 emission mitigation. This study conducts a model based on the year 2020 using the Long-Range Energy Alternatives Planning System (LEAP) software and sets two scenarios (baseline scenario and emission peak scenario) to forecast the future energy demand and CO2 emissions of industrial sectors in China's Beijing-Tianjin-Hebei region until the year 2035. Moreover, the industrial sectors are classified into traditional high-energy-consuming industries, emerging manufacturing industries, daily-related light industries, and other industries. The forecasting results show that (1) The industrial energy demand of the entire Beijing-Tianjin-Hebei region will grow from 234 Mtce in 2020 to 317 Mtce in 2035, and the corresponding energy structure will shift from coal-based to electricity-based; (2) at the provincial level, all three provinces will experience an increase in industrial energy demand between 2020 and 2035, with Hebei experiencing the fastest average annual growth rate of 2.18% and the largest share of over 80%, and Beijing experiencing the highest average annual electrification rate of 70%; (3) at the industrial sector level, the electricity and natural gas will gradually replace other energy sources as the main energy source for industry. The most representative industrial sub-sector in Beijing, Tianjin, and Hebei provinces are all traditional high-energy-consuming industries, which will account for more than 90% of the total energy demand in both Tianjin and Hebei by 2035. [ABSTRACT FROM AUTHOR]

Assessing the marginal abatement costs (MACs) of emissions improves the understanding of the extent of current CO2 mitigation and provides regions and industries with information on how to mitigate emissions cost-effectively. This study proposes a hybrid method to evaluate the MAC. It combines the strengths of bottom-up engineering methods and top-down economy-wide methods. A parametric directional distance function is employed to estimate the MAC from an economic perspective, and the abatement level is further incorporated to generate increasing curves, similar to the outcomes derived from an engineering perspective. In addition, this method takes into consideration whether the abatement level exceeds the abatement potential with current production technologies so as to provide a more realistic estimation of the MAC curves. The proposed technique is applied in estimating the carbon emission MAC in China’s petroleum industry. The estimation results indicate that (i) the MAC of China’s petroleum industry would change from 9821 to 16,307 yuan/ton when the abatement level increases from 1 to 50%; (ii) this industry would spend 36.5 to 42.5 billion Chinese yuan annually to achieve China’s CO2 reduction target proposed in its Intended Nationally Determined Contributions (NDCs); (iii) assigning the CO2 reduction targets based on the estimated MAC curves instead of the traditional grandfathering abatement target assignment would help to save China’s petroleum industry an additional 29.97 to 33.65% in abatement costs when achieving the NDCs. The MAC curves estimated in this study indicate more accurate relationships between abatement levels and abatement costs, and hence provide decision-makers in industries and governments with a more reliable instrument to determine the prices of emissions permits, total abatement costs, and implementation strategies in an emissions trading scheme. [ABSTRACT FROM AUTHOR]

Although China has developed the world's largest carbon emissions trading scheme (ETS), there is no official documentation explaining how the current sectoral coverage plan was determined and what sectoral rollout plan is preferred. Here, we contribute to the policy development of the world's largest carbon market by suggesting a priority list of industries be covered in the ETS. We estimated marginal abatement cost curves using a database of more than two million firms covering over 500 four-digit industries that account for more than 97% of total industrial emissions, and simulating various carbon market scenarios including thermal power, 13 designated, and an additional 50 industries that have high emissions or are covered in other ETSs. Our analysis suggests that the cement industry should be the next sector to be included in China's ETS. In our revised list, the average abatement cost can be reduced by 39.5-78.3% compared with the business-as-usual scenario., Competing Interests: The authors declare no competing interests., (© 2022 The Author(s).)