China & World Economy / 127–147, Vol. 29, No. 5, 2021

Quality of Life and Relative Household Energy Consumption in China

Xunpeng Shi, Tsun Se Cheong, Jian Yu, Xiaoguang Liu

Abstract

Increasing household energy consumption, mainly due to consumption upgrading, will create tough challenges for China if that country is to achieve peak carbon emissions in 2030 and carbon neutrality in 2060. However, this critical issue has not been explored comprehensively in the literature. Using China Family Panel Studies data and the distribution dynamics approach, this article is the first study to examine the relationship between quality of life (QOL) (proxied by consumption upgrading) and relative household energy consumption (RHEC). The results show that convergence clubs exist in all QOL groups for the RHEC, but they are more evident in the groups with lower middle and low QOL. This is encouraging because they suggest that an improvement in QOL does not necessarily lead to a higher level of energy consumption. The dataset was then divided into rural-urban and regional subgroups to further explore the impacts of these different characteristics on energy consumption. Significant disparities are found among the same QOL groups between urban and rural households and among different regions. The results derived from this study lead to pragmatic policy suggestions in areas including energy saving, emissions reduction, and particularly alleviation of inequality.