The Carbon Emissions Trading Policy (CETS) serves as China's core institutional tool for pursuing the 'dual carbon' target and improving its energy governance system. It is also a key policy tool for bridging the regional energy utilisation gap and promoting energy equity. The CETS provides institutional support for building a system for green, low-carbon and circular development and achieving common social welfare. While achieving carbon emissions reduction targets, the policy provides a paradigm for spatial collaborative governance of energy equity. Drawing on panel data from 297 Chinese cities from 2007 to 2023, we first employ the difference-in-difference model to reveal the meso-scale impacts of CETS on energy equity and their underlying mechanisms. We then use the spatial Durbin model to analyse the spatial spillover influence of the CETS on energy equity. The results reveal that CETS has markedly promoted cities' energy equity. Mechanism analysis demonstrates that CETS can improve cities' energy equity through credit allocation orientation, green innovation and media attention effects. Heterogeneity analysis reveals that the CETS has a more pronounced effect, boosting energy equity in non-resource cities, key environmental protection cities, and non-old industrial base cities. Further investigation demonstrates that positive autocorrelation and spatial spillover effects exist in China's city energy equity. Specifically, as the pilot policy advances steadily, cities' energy equity improvements have a significantly positive impact locally and on surrounding regions. This study provides a scientific decision-making basis for developing an energy system with distributive, procedural, recognition and compensation equity and promoting fair energy sector development. • The CETS can significantly improve the level of urban energy equity in China • The mechanism is the credit allocation orientation, green innovation, and media attention effect. • The effect is more notable in non-resource cities, key environmental protection cities, and non-old industrial base cities. • China's urban energy equity has positive autocorrelation and spatial spillover effects.
Song et al. (Sun,) studied this question.