The development of green and low-carbon energy has become a hot topic for research as traditional patterns of energy utilization have been detrimental to our environments. Photo: FILE

Energy economics emerged as a new branch of economics in the 1970s. Since the 1990s, some Chinese universities have gradually established their research institutions of energy economics. But overall, the study of energy economics is still in its initial stage, said Wei Chu, a professor from the School of Applied Economics at Renmin University of China.

In recent years, the establishment of the discipline and its research centers in some universities and other research institutes has provided energy economics studies with institutional support. In addition, some research institutions and scholars directly or indirectly participate in the formulation of national energy strategies, achieving mutual verification between energy economic theories and energy development strategies, said Shi Dan, director of the Institute of Industrial Economics at the Chinese Academy of Social Sciences.

Energy economics has advanced along with many other disciplines. For example, both environmental economics and international relations studies have connections with energy economics, and they fuel the study of energy economics, Shi added.

Lin Boqiang, a professor from the School of Management at Xiamen University, said that current research of energy economics mainly focuses on the impact of energy on macroeconomic growth and sustainable social development, the impact of energy utilization patterns on the environment and climate change, and energy transformation and strategies of optimizing energy structures.

Energy economists should pay attention to cases within the energy industry that are closely related to China’s economic and social development, Lin said. He also suggested establishing a theoretical framework of energy economics based on the characteristics of China’s current economic and social development.

The study of energy economics closely follows the requirements of social development, which can be found in such research focus points as the balance of energy supply and demand, energy deregulation, energy efficiency, and energy economic security. As climate change is becoming increasingly prominent, the development of green and low-carbon energy has become a hot topic for research. In addition, research on the changes in the global energy industry chain and energy security has much practical significance, Shi said.

Wang Zhen, a professor from the China Energy Strategy Research Institute at China University of Petroleum, said that a series of research topics have emerged that center on energy and the environment, energy transition and economic growth, and energy finance. Specific examples include the laws of China’s energy consumption growth, the institutional arrangements for the integrated development of multiple energies, regulation and deregulation of public utilities such as electricity and natural gas, energy internet, carbon finance, and green finance.

Wang said that energy economics studies are facing new challenges. Energy demand and economic growth are displaying a decoupling tendency. Although global energy demand continues to grow, the increase will be largely offset by the decline in energy intensity (the amount of energy per unit of GDP). The proportion of non-fossil energy consumption increases year by year in the process of industrial upgrading, and it will become the main driving force for the increase in total energy consumption. In addition, digital technology is reshaping the energy industry. 5G, artificial intelligence, the internet of things, blockchain and other information technologies have shown huge potential in energy production and consumption, opening up new channels for energy reform and promoting the emergence of new patterns and new forms of the energy industry.

International energy governance is also facing new challenges. New challenges in regard to international governance mechanisms and globalization have made the energy system more complex and have posed threats to energy security and international energy cooperation, Wang continued.

Since energy is closely related to national safety and national strategies, energy economists should pay more attention to externalities, Shi suggested. Many scholars have realized that energy economics needs to develop along with other related disciplines such as technology, environment, security and diplomacy, and it must integrate multi-disciplinary theories and research methods. Even so, energy economics is still a niche discipline in China. Limited research resources are mainly used for studying energy policies, while textbooks and disciplinary construction needs further improvement.

In the future, the research of energy economics should focus on the urgent needs inherent within national economic development. We should carry out more cooperative research with energy authorities and energy enterprises to serve national energy policy decision-making and assessment. In addition, we need to improve the disciplinary system, strengthen the training of teachers and those with talent, and formulate better curriculums, Wei concluded.