Energy transition policy, technology innovation and sustainable manufacturing

This study examines the impact of China's New Energy Pilot City Policy (REPCP) on green development in the manufacturing sector, focusing on the role of technological innovation. Using a Difference-in-Differences (DID) approach with firm-level data from 30 Chinese provinces and cities (2000-2021), the research analyzes how the policy affects firms' adoption of sustainable manufacturing practices. The findings reveal that the REPCP significantly promotes green development, particularly in regions with moderate levels of industrial development. Moreover, technological innovation amplifies the policy's positive impact, indicating a synergistic relationship. The analysis also finds that state-owned enterprises are more responsive to the policy than non-SOEs. This study contributes to the understanding of energy transition policies by providing empirical evidence of their efficacy in China's manufacturing sector, highlighting the importance of technological innovation, regional variations, and ownership structures in achieving sustainable manufacturing.