Distributed solar and carbon trading enable more affordable and equitable clean heating in rural Northern China
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Figure 1: County-level heating expenditure burden in the 2+26 region under different policy scenarios.
view moreCredit: Feng Wang, et al.
China's campaign to replace bulk coal with clean heating has delivered air-quality and health benefits across the Northern China. But as subsidies begin to shrink in some places, a new question has emerged: can rural households still afford to stay clean?
In a study published in Fundamental Research, researchers from Nanjing University of Information Science & Technology, Shandong University, and the Chinese Academy of Environmental Planning addressed that question across the "2 + 26" region — Beijing, Tianjin, and 26 surrounding cities that have been central to Northern China's rural clean heating policy.
Using a township-level dataset covering 25,187 villages or communities, the team estimated what rural households spend on clean heating, how large that burden is relative to local income, and what happens when operating subsidies are reduced or removed. They also tested possible ways to ease the pressure: revenues from China’s voluntary carbon market and distributed rooftop solar photovoltaics
"We found that current heating subsidies mask potential regional inequalities," shares first author Feng Wang from Nanjing University of Information Science & Technology. "Under the 2020 baseline with subsidies in place, about 0.67 million households in 15 counties across Hebei, Henan, and Shanxi Provinces were already facing excessive heating burdens."
Notably, if operating subsidies were fully removed, total household heating expenditure across the region would rise by 36.2%, or about 10.3 billion CNY in aggregate. On average, each household would pay about 523 CNY more per year.
"The pressure would not be shared equally. Low-income households would be hit the hardest, particularly in parts of Hebei, Henan and Shanxi where incomes are lower and electricity-based heating is more common", says co-corresponding author Wei Zhang of the Chinese Academy of Environmental Planning.
In some cities, most retrofitted households would struggle to stay within an affordable heating threshold if subsidies were cut back. The team then tested whether new income streams could ease the burden. Carbon credits from clean heating emission cuts could help, but only modestly at current prices. "Across the whole region, clean-heating carbon credits would generate about CNY1.91 billion in revenue — just enough to offset around 18.7% of the increased heating costs, or roughly CNY97 per household on average," adds Wang.
Rooftop solar performed better. In regions with stronger solar potential and supportive conditions, distributed photovoltaics could offset a much larger share of the added heating expense. The study estimates that in Hebei, Shanxi and Beijing, rooftop solar could compensate for an average of 32.2–64.5% of the extra costs.
"Under one larger-scale solar scenario, the added benefits would offset 93.8% of the increase caused by subsidy removal, and 25 of the 46 hardest-hit counties would return to an affordable range," says co-corresponding author Jiashuo Li of Shandong University. "A one-size-fits-all subsidy exit would create serious affordability risks — a more durable path is to phase subsidies out selectively, protect low-income households, and expand distributed solar where it can genuinely improve household incomes."
The authors say their results point to a more targeted next stage for rural clean-heating policy: faster subsidy reform in wealthier places, more precise support for poorer counties and households, and earlier solar-heating pilots in provinces such as Henan and Shanxi where affordability pressures are most acute.
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Contact the author: Feng Wang, School of Business, Institute of Climate Economy and Low-carbon Industry, Nanjing University of Information Science & Technology, Nanjing 210044, China, vanf1004@nuist.edu.cn; Wei Zhang, Chinese Academy of Environmental Planning, Beijing 100041, China, zhangwei@caep.org.cn; Jiashuo Li, Institute of Blue and Green Development, Shandong University, Weihai 264209, China, lijiashuo@sdu.edu.cn.
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Journal
Fundamental Research
Method of Research
Data/statistical analysis
Subject of Research
Not applicable
Article Title
Exploring the economically sustainable solutions for clean heating in rural Northern China
