Moving to a Low-Carbon Economy in China: Decoupling and Decomposition Analysis of Emission and Economy from a Sector Perspective

Understanding decoupling China's emissions from the economy and identifying the drivers of emissions at a sector perspective can facilitate China's move to a low-carbon economy that makes economic growth compatible with carbon reduction. This study combined decoupling and decomposition econometric techniques to quantify both the decoupling effects and the driving elements of carbon emissions in China's six major sectors. The study found that the leading source of all carbon emissions in China come from the industrial sector, followed by the 'Other' sectors and the Transport sector. Further, the decoupling status in those sectors differed: Construction (weak decoupling), other (weak decoupling), Trade (weak decoupling), Industry (weak decoupling), Transport (expansive coupling) and Agriculture (expansive negative decoupling). Finally, the economic output effect becomes the major contributor for carbon emissions among these six sectors, followed by the energy intensity effect. However, the energy structure effect and carbon coefficient effect are both weak.