sustainability

Article Toward in : Revisiting Driving Factors of Chinese Generation Development and Spatial Distribution

Li Ma 1,2,* and Die Xu 1,2

1 Institute of Geographical Sciences and Natural Resources Research, Chinese Academy of Sciences, Beijing 100101, China; [email protected] 2 College of Resources and Environment, University of Chinese Academy of Sciences, Beijing 100049, China * Correspondence: [email protected]; Tel.: +86-10-6488-9655

Abstract: As the biggest renewable energy installation and generation country globally, it is important to deeply understand China’s wind power production determinants and draw implications for energy policy. This paper analyzes local electricity deployment, electricity consumption, investment in wind

power, and price of wind power electricity on-grid apart from traditional GDP and CO2 factors in the panel data regression model, and some interesting results are found. The investment of installation and the price of wind power electricity on-grid have negative impacts on wind power generation, while local electricity consumption and inter-provincial power transmission capacity significantly

impact wind power generation positively. GDP and CO2 emission per capita have negative and positive impacts on wind power production, respectively. As for different wind power zones, the

 most influencing factors are local electricity consumption. Hence, this paper concludes that local  absorbing capacity is still an important limiting factor to Chinese renewable . At

Citation: Ma, L.; Xu, D. Toward last, some policies are suggested to enhance the local absorbing capacity of renewable energy. Renewable Energy in China: Revisiting Driving Factors of Keywords: renewable energy; wind power generation; driving factors; spatial differences Chinese Wind Power Generation Development and Spatial Distribution. Sustainability 2021, 13, 9117. https://doi.org/10.3390/ 1. Introduction su13169117 With rapid economic development, China has become the largest carbon dioxide (CO2) emitter since 2006 and has contributed about 30% of the world’s total CO2 emissions [1]. Academic Editor: Domenico Mazzeo Despite significant challenges to reducing emissions as an emerging economy with a huge population, China has adopted more vigorous policies and measures to have CO Received: 12 July 2021 2 emissions peak before 2030 and achieve before 2060 [2]. However, it is Accepted: 12 August 2021 Published: 14 August 2021 not easy to achieve such targets due to China’s higher proportion of fossil fuels in energy consumption. Consequently, China set up national development priorities to encourage

Publisher’s Note: MDPI stays neutral the use of clean energy. with regard to jurisdictional claims in In 2005, China approved a ‘Renewable Energy Law’ aimed at promoting renewable published maps and institutional affil- energy in the country. The law requires the local government to support the research iations. and development (R&D) of renewable energy technics and to provide financial subsidies through the Renewable Energy Development Fund to industrialize renewable power generation [3]. Apart from this law, many renewable energy policies have been proposed. All these policies have promoted the development of renewable energy in China. According to data from the Chinese Energy Bureau, the installed capacity of renewable energy sources Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. has been growing by an average annual rate of 12 percent since 2016, with new energy This article is an open access article sources such as wind and solar power taking up over half of the total installed capacity distributed under the terms and of renewable energy sources [2]. In 2011, China became the greatest country with wind conditions of the Creative Commons power installation, and in 2020, the capacity of wind power installation on-grid in China Attribution (CC BY) license (https:// reached 289.53 million kW and accounted for 12.79% of the total installed capacity. creativecommons.org/licenses/by/ The increased attention on renewable energy sources can be attributed to several 4.0/). factors. First, it is important to deeply understand the determinants of renewable energy

Sustainability 2021, 13, 9117. https://doi.org/10.3390/su13169117 https://www.mdpi.com/journal/sustainability Sustainability 2021, 13, 9117 2 of 13

production and draw resulting implications for energy policy. A growing number of researchers have devoted their efforts to examining the renewable energy-growth nexus studies [4], while comparatively fewer studies investigate the components that affect renewable energy [5]. Second, renewable energy offers solutions to energy security and global warming initiated environmental factors such as CO2 emission. Many scholars have examined the influence of real GDP per capita, CO2 emissions per capita, real oil prices, and real income per capita on renewable energy consumption for G7, African, Balkan, and emerging countries [6–13]. Additionally, Omri et al. studied the impacts of these factors on renewable energy consumption of different countries and found significant differences among different income groups. Increases in CO2 emissions and trade openness are the major drivers of renewable energy consumption, while oil price increases have a smaller but negative impact on renewable energy consumption in the middle-income and global panels [14]. A few papers investigate the technical, institutional, and political factors, given that many studies focus on the causal relationship between renewable energies development with economic growth and CO2 emission [15]. Apergis and Eleftheriou investigated the effects of institutional and political factors on renewable energy usage and found that both factors exert a strong and statistically significant effect on renewable energy consumption after controlling the economic environment. Further, Biresselioglu and Karaibrahimoglu examined the effect of government orientation on renewable energy consumption levels [16]. In addition, Rasoulinezhad and Saboori studied the impacts of trade and financial openness apart from the above factors in the Independent States of the Russian Commonwealth. They found a long-run bidirectional relationship between all the variables except for economic growth-renewable energy use linkage [17]. Finally, Alam and Murad addressed the effects of trade openness and technological progress on renewable energy use for 25 Organization for Economic Co-operation and Development (OECD) countries. They found that all factors influence renewable energy use positively and significantly [18]. The above studies were mostly carried from the consumption perspective. However, some scholars explored the factors from the production perspective, including political, social, economic, and country-specific factors [19]. Political factors include price regulation, quotas of renewable energy, and even the government’s orientation and political and government ideology [20,21]. Social and economic factors include the price of fossil fuel energy, CO2 emission, the contribution of other energy to electricity generation, size of energy consumption, and income level. Country-specific factors include the wealth of production potential of renewable energy and continuous commitment to renewable energy. The International Energy Agency’s (IEA) ‘Medium-Term Renewable Energy Market Report 2015’ documents five factors that impact renewable energy development and deployment at the country level, including regulatory and institutional, financial and economic, technical and innovation, and social and environmental factors [22]. The income per capita, or GDP per capita, is an important determina