Energy policy strategies for cleaner production: The roles of renewable energy and green innovation

Abstract

Cleaner production is central to reconciling economic growth with climate goals, yet its drivers operate unevenly across space. This study examines the determinants of provincial carbon emissions using an annual panel of Chinese provinces from 2000 to 2023, with explicit attention to structural, technological, and institutional heterogeneity. The analysis evaluates the roles of renewable energy deployment and green innovation, while systematically accounting for GDP per capita, industrial structure, urbanization, foreign direct investment, and environmental regulation. Across a suite of complementary estimators that address cross-sectional dependence and slope heterogeneity, higher renewable energy shares and stronger innovation capacity are consistently associated with lower CO₂ emissions. These mitigation effects are economically meaningful and robust, whereas economic growth remains emissions-increasing. By contrast, industrial upgrading and stringent environmental regulation are linked to significant emission reductions, urbanization exhibits a modest positive association, and the effect of foreign direct investment is weak and context dependent. Distribution-sensitive estimates further reveal pronounced asymmetries: the emissions-reducing impacts of renewable energy and innovation intensify markedly in high-emission provinces, highlighting the limits of uniform policy prescriptions. Machine-learning validation confirms the dominant importance of renewable energy and innovation among competing drivers and supports the stability of the empirical patterns. Taken together, the findings underscore the value of regionally differentiated strategies that integrate clean energy expansion, innovation incentives, and enforceable regulation. Such an approach directly advances SDG 7 (Affordable and Clean Energy) and SDG 13 (Climate Action), while reinforcing SDG 9 (Industry, Innovation and Infrastructure) and SDG 12 (Responsible Consumption and Production) through cleaner and more resilient production systems.