Scandinavian Working Papers in Economics
Working Papers,
Copenhagen Business School, Department of Economics
No 6-2026: The Power of Trading Innovation: Is Market-Oriented Trading of Distributed Power Generation Greening the Energy Industry?
Kai Zhu, Xiangran Cheng, Kangyin Dong () and Tooraj Jamasb ()
Additional contact information
Kai Zhu: Chinese Academy of International Trade and Economic Cooperation, Beijing 100710, China
Xiangran Cheng: School of Statistics, Tianjin University of Finance and Economics, Tianjin 300222, China
Kangyin Dong: School of International Trade and Economics, University of International Business and Economics, Beijing 100029, China
Tooraj Jamasb: Department of Economics, Copenhagen Business School, Postal: Copenhagen Business School, Department of Economics, Porcelaenshaven 16 A. 1. floor, DK-2000 Frederiksberg, Denmark
Abstract: Amid the global green energy transition, China faces bottlenecks in renewable energy integration due to underdeveloped market-based trading systems. To address this gap, this study investigates the effectiveness of distributed power generation trading (DPGT) using panel data of Chinese cities between 2014 and 2023 and a multi-period difference-in-differences model. The findings show that (1) DPGT has significantly promoted the development of green energy industries; (2) the aggregation of talent and capital elements and green technology cooperation facilitate industrial growth; (3) the policy effects are more pronounced in non-resource-based cities, high energy-consuming cities, and cities that prioritize DPGT industries; (4) DPGT reduces emissions of conventional pollutants by displacing traditional thermal power generation. However, due to the peak shaving of thermal power and rebound effect, its carbon emissions reduction has not met expectations.
Keywords: Distributed power generation trading (DPGT); Market-oriented trading; Green energy industry; Talent and capital aggregation; Green technology cooperation
JEL-codes: C21; H23; Q51; Q58; R12
Language: English
55 pages, February 25, 2026
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