Energy justice across income groups in China residential sector under decarbonization

Energy justice is a top priority for government under decarbonization, which can mitigate the potential negative impacts of decarbonization on marginalized groups. The sheer scale and diversity of China’s economic and social development across provinces necessitate a nuanced examination of energy justice. In particular, disparities in both energy accessibility and affordability are pronounced within the residential sector. Under decarbonization, the inequitable distribution is likely to be exacerbated by the potentially increased costs of energy. Such inequity in income groups in low-carbon transition suggests a strong need for a better understanding of the implications of decarbonization for energy justice. While some studies have considered income inequality at national or sub-national level, the group disparities in income call for a granular exploration to understand the intricacies of energy justice at the residential-level.
Here we develop a new version of GCAM-China (GCAM-China-Mul, Fig.1), featuring an expanded set of 21 income groups in the building sector, to explore energy burden and fairness for different income groups. This multiple-consumer feature is important because the demand and elasticity for residential energy are non-linear in response to income, which in turn, drives different future demand and responses under decarbonization. This analysis aims to address the following questions: what the distributional effects of decarbonization policies on these different income groups and the resulting residential energy justice disparity across the groups. 
 
Fig.1 Research framework. The colored boxes represent the modeling capabilities developed for this study. There are 21 heterogeneous income groups (resid_urban_d1-d10, resid_rural_d1-d10 and a commercial consumer group) on the demand side and the energy consumption by fuel is further disaggregated to 57 representative typical and high-efficiency technologies.

This multiple consumer feature is conceptually built upon similar structures in GCAM and GCAM-USA, with two additional contributions: First, significant urban-rural income gap based on China’s condition is considered. Second, we employ high-resolution residential-level data from China Family Panel Studies to calibrate the model. About decarbonization scenarios, we set net-zero or close to net-zero at the national level and building sector level, and cross-cutting each other to form four scenarios. In combined scenarios, we can achieve national-level decarbonization as well as building sector deep decarbonization. 

We found that national-level constraints primarily reduce indirect emissions, but achieving deep mitigation in the building sector requires combining these with sector-level constraints. The socioeconomic impacts of decarbonization highlight significant disparities: low-income groups face more pronounced negative effects, while high-income groups benefit more from positive outcomes. Additionally, urban and rural areas exhibit distinct energy transition pathways. These findings highlight the necessity of targeted interventions to achieve a just energy transition.