The Empirical Research For The Energy Consumption Structure Influenced By Distorted Energy Price And The Energy Substitution Relations

The price of energy is not only one of the basic factors for energy consumption structure, but also the essential factor for the market regulation and substitution relationship. The contradiction between free competition and market monopoly caused by the Chinese government regulation will cause price distortion. In this distorted price system, the substitute relation of energy is not normal any more, leading to energy structure unreasonable. In China, the ratio of coal consumption is too high, but the proportion of good energy such as oil and gas is low. The state of China's energy will cause low efficiency of the energy, environmental damage, energy conservation and emission reduction pressure, and so on. This condition became great barriers for sustainable and rapid development of China.This paper is based on the theory of the price and the supply and demand. We will establish minimize cost function equations and we are going to use various analytical methods such as comparative analysis, elastic analysis and related analysis, etc. First, we'll measure distortions of the energy price and substitution relation in China. Then we'll make empirical research for energy consumption structure influenced by distorted energy price and substitution relation. This research will profoundly elaborate the mechanism from the distortions of the energy price to the structure of the energy consumption in China.The structure of the text goes in five parts as follow:Chapter one is introduction. First, we present the background, purpose, theoretical meaning and practical value of this research. Second, this paper reviews the related literature at home and abroad, and then puts forward what this paper might solve for the limitation of the previous study. For the last, we briefly show the content and the structure of the paper.For the second chapter, we will introduce the reform of energy price and the evolution of energy consumption structure in China. This chapter is divided into two parts:the first part is the introduction about the status and prospect of China's energy structure; for the second part, we'll review the review the reform of China's energy prices marketization.Chapter three is theoretical basis of the research. In this part, we first review previous scholars'studies about the price distortion theory basis and measuring method. Then we put forward and introduce briefly the model of trans-log cost function which will be used in this study.The fourth chapter is the empirical analysis section of this paper. Under the support in the theory and method shown in the third chapter, we use the actual data to measure the distortion level of China's energy prices and energy alternative relationship. Then we make an empirical study on how energy consumption structure is influenced by the distorted energy prices and alternative relations, so that we can reveal the inherent relations between distorted energy prices and energy consumption structure in China.Chapter five is the conclusions and policy recommendations of this paper.This paper has three main conclusions:First, China's energy consumption structure is unreasonable, which the ratio coal consumption is too high. Second, China's energy prices are distorted, it is because the reform of China's energy marketization has fallen behind, which the China's government regulation has big effects on China's energy prices. Third, the distortion of energy price and the abnormal replacing relationship of China's energy have significant influences on the consumption structure of China's energy.According to the conclusions, there are three suggestions on this paper:First, we should deepen the reform mechanism of the energy price, appropriately reduce the regulation scope of China's government and cancel the government pricing in the final. Second, Chinese government should increase the cost of the energy, control the speed of the domestic energy demand growth, and then promote the process of energy conservation and emissions reduction. Last but not least, China's coal economic should be paid more attentions, China's government should plan the consumptions and reserves of coal energy rationally and we should make sure China's energy supply safely. The innovation of this article is as following:For the first, in the China's energy economic study field, this paper will first calculate out the level of distortion of China's energy prices, then take it as an important variable to explain China's energy consumption structure to make empirical analysis. Secondly, for the study method, this text will make simultaneous equations of the trans-log cost function and establish the connection between the price distortions and the energy consumption structure. Then combining with elastic analysis, this paper will analysis the mechanism of action from the distortions of energy price to the consumption structure of China's energy. In addition, the policy suggestions put forward is very practical.Due to the lack of partial statistical data (such as the data of the annual energy prices), this paper adopts the producer price index of industrial products (mainly includes coal, petroleum, electricity) to replace the missing data, which may affect the accuracy of the estimations of the model. In addition, the price distortions between the energies can be extended to the production factors (e.g. labor, capital, energy, etc), which can be shown more comprehensive. This can help us to explain the distorted energy prices'influence on the energy consumption structure more reasonably. But because of the high demand to related data and the complexion of equation system, it may lead to emerge worse results if any slight mistakes. That's all we want to discuss, this paper will not expand it any more.