Impact of Urbanization of Coal Consumption in China
Coal is the backbone of China’s urban development. The economic activities in urban areas, including power generation, manufacturing, urban mobility, commercial services, and building construction increase demand for coal. The urbanization ratio in China rose from around 36% in 2000 to 56% in 2015. At the same time, the total coal consumption in China grew from 1 billion to 2.7 billion tons of standard coal, a 172% increase. Unfortunately, coal combustion results in negative effects on the environment and public health. As the current biggest carbon emitter in the world, China is taking action to adjust the urban growth and control coal consumption. However, the relationship between these two factors is not fully understood.Applying a dataset consisting of China’s 29 provinces from 2006 to 2015, this paper examines the effect of urbanization on coal consumption. The hypothesis is that at the current stage, urban growth increases coal consumption in China. Moreover, urbanization’s effect on coal consumption is more prominent for the western region of China in comparison to their middle, eastern and northeastern counterparts, as the former region is expected to support urban growth in the near future, and consume coal to support urban activities. Using the fixed effect model, this paper found some evidence of an association between increased urbanization and growth in coal consumption per capita in China. However, when the time trend is considered, the relationship largely disappears. In addition, urbanization probably has a more prominent effect on the western region than their eastern and middle counterparts. However, there is no evidence that indicates the effect of urbanization in northeastern region is different from that of western region.