Using electricity prices to curb industrial pollution
EfD Authors:
In this study, we show that changes in electricity prices in China have significant environmental consequences through its effect on industrial pollution emissions concentrations. To investigate this relationship, we pair a novel dataset of hourly smokestack-level pollutant emissions of industrial plants in Anhui, China with changes in hourly electricity prices. Using a difference-in-differences (DID) regression model, we find that pollution emissions from these plants have an inverse relationship with electricity prices.