Can Digital Finance Promote Low Carbon Transition

Using panel data of cities in the People's Republic of China from 2011 to 2019, this paper analyzes the impact of digital finance on low-carbon transition derived from a super-efficiency slacks-based measure data envelopment analysis. We find that digital finance promotes low-carbon transition, and this finding is robust with respect to the choice of sample, potential presence of measurement issue, choice of study period, presence of other policies, and potential endogeneity, among others. This impact, at least in part, is through increased green innovations. We also find evidence for impact heterogeneity across locations and by the level of low-carbon transition. This paper provides policy implications for the low-carbon transition of the region from a digital finance perspective.

Technological revolutions have increased the world’s wealth unevenly and in ways that have accelerated climate change. This report argues that achieving The Paris Agreement’s objectives would require a massive transfer of existing and commercially proven low-carbon technologies (LCT) from high-income to developing countries where the bulk of future emissions is expected to occur. This mass deployment is not only a necessity but also an opportunity: Policies to deploy LCT can help countries achieve economic and other development objectives, like improving human health, in addition to reducing greenhouse gases (GHGs). Additionally, LCT deployment offers an opportunity for countries with sufficient capabilities to benefit from participation in global value chains and produce and export LCTs. Finally, the report calls for a greater international involvement in supporting the poorest countries, which have the least access to LCT and finance and the most underdeveloped physical, technological, and institutional capabilities that are essential to benefit from technology.

There are demands on central banks and financial regulators to take on new responsibilities for supporting the transition to a low-carbon economy. Regulators can indeed facilitate the reorientation of financial flows necessary for the transition. But their powers should not be overestimated. Their diagnostic and policy toolkits are still in their infancy. They cannot (and should not) expand their mandate unilaterally. Taking on these new responsibilities can also have potential pitfalls and unintended consequences. Ultimately, financial regulators cannot deliver a low-carbon economy by themselves and should not risk being caught again in the role of ‘the only game in town.’

The “Ant Forest” project has been launched since August 2016 as an innovative green digital finance venture by Ant Financial Services Group, a related company of Alibaba. It aims to encourage the mobile payment platform users to reduce carbon footprint by connecting their virtual identity to individual carbon savings account and providing carbon offset rewards through planting physical trees in Northwest China. By May 2018, Ant Forest had more than 350 million users. It has rapidly achieved impressive success as a green digital innovation in public participation, carbon reduction and tree plantings in China. This paper examines the process of innovating and learning during the development of this app and the project. Innovation system and multi-level perspective approaches are used to analyse the determinants and the consequences of this green digital innovation. The results show that the motivative design and effective leadership is the key to this success. Moreover, this emerging force from private sector for carbon reduction shed light on future directions for a “bottom-up” low-carbon transition.

This book is the first comprehensive assessment of the state of low-carbon investments in Asia, analyzing the rationales, mandates and public–private financing activities. Based on the experiences of several regional initiatives wherein public financing is catalyzing private investments in low-carbon infrastructure, this book proposes a framework that can be used as a tool to identify factors that influence private investment decisions and policy instruments that can scale up the private capital. Placing the Asian economies onto a low-carbon development pathway requires an unprecedented shift in investments. This book addresses this situation by asking questions such as: • What is the central role of private finance in achieving the Paris Agreement targets? • What key policy levers and risk mitigation can governments use in an effort to unlock the potentials of private capital? • How can regionally coordinated actions hold significant promise for scaling up private investments?

This edition of the OECD Sovereign Borrowing Outlook reviews developments in response to the COVID-19 pandemic for government borrowing needs, funding conditions and funding strategies in the OECD area.

The book provides readers with essential insights into key issues in connection with planning, developing and financing sustainable energy projects in China that are relevant for practitioners, investors and developers involved in the emerging sustainable energy sector. It offers readers a deeper understanding of these contemporary issues by drawing on the lessons learned in real-world sustainable energy and green finance development activities in China, which are driven by central planning and policy implementation and complemented by investments and finances from public-private partnerships.

Existing buildings are responsible for over 40% of the worlds total primary energy consumption. An impressive amount of energy could be saved simply by applying energy-efficient technologies. Yet, various market barriers inhibit energy efficiency improvements in existing buildings and result in energy savings that are significantly lower than potentials. This publication provides illustrations of policies and measures implemented in five IEA member countries and the European Union. Each case includes relevant background and contextual information, as well as a detailed evaluation of each policy according to five pre-defined criteria: relevance, effectiveness, flexibility, clarity and sustainability.

To become carbon neutral, all nations must reduce household carbon emissions. The effect of digital financial development on home carbon emissions cannot be overlooked for such a task. This research examined the effects of the growth of the digital economy and sustainable economic growth experimentally using panel data in China from 2005 to 2020. The findings demonstrate that inclusive digital financing may directly lower carbon intensity. It can also impact carbon intensity by enhancing the industrial structure and encouraging green technologies. A small financial audience is the cause of the marginal drop. At the same time, a strong external pulling force is the cause of the marginal rise owing to individual efficiency and scale effects. The findings of the mediating impact reveal that digital financial inclusion encourages the expansion of carbon sequestration via green space and green technologies while encouraging the decrease of carbon intensity by increasing per capita disposable income and digitalization. We do a heterogeneity study of the effect using two features, four financial instruments, and several city characteristics. This leads to several subtle discoveries that are advantageous for executing specific policies. Finally, several techniques demonstrate the findings' reliability, strengthening this research's main finding.