Xiawei Liao

Eco-compensation has become an important policy instrument for integrated watershed management in China. However, quantitative approaches that jointly consider water quantity and quality from both production and consumption perspectives remain limited, constraining the systematic development of eco-compensation standards. This study proposes a funding allocation framework based on Water Yield Equivalent (WYE) and Water Consumption Equivalent (WCE) indicators incorporating both water quality and quantity, and applies it to the upper Miyun Reservoir watershed. Compensation funds were calculated for nine counties in 2000, 2008, and 2013. The results show substantial spatial differences in WYE and WCE, resulting in differentiated compensation responsibilities and receipts. Under the baseline scenario, Miyun County received the highest compensation in 2008 (RMB 198 million), whereas Chicheng County incurred the highest compensation payment in 2000 (RMB 135 million). Further comparison with local fiscal revenue indicates that the ratio of compensation funds to fiscal revenue reflects the potential relative fiscal incentive or constraint of the eco-compensation scheme on local governments. In 2013, Yanqing County had the highest ratio under the baseline scenario, at 12.76%, which increased to 22.59% under the South-to-North Water Diversion Project (SNWDP) water price scenario. Overall, jointly accounting for water quantity, quality, production, and consumption provides a quantitative basis for differentiating compensation responsibilities and benefits across counties. For the Miyun Reservoir watershed, future eco-compensation policies could further integrate water resource protection and pollution reduction requirements to establish differentiated compensation standards, thereby improving the coordination between the compensation mechanism and watershed water resource management objectives.

This study selects the electro-optical equipment manufacturing industry as an example to explore whether participation in the global value chain increases or mitigates a country’s carbon emissions and describes the impacting factors. Based on multi-regional input-output tables, a value-added decomposition model is used to decompose forward and backward value-added/final products of the world’s electro-optical equipment manufacturing industries in 65 countries from 2005 to 2015. Impacts of several global value chain participation characteristics, including position, forward participation and production length, and backward participation and production length, on a country’s carbon emissions, are examined. The results show that Asian countries have the highest participation rate in the global value chain, both forward and backward, of the electro-optical equipment sector with increasing proportions for forward participation, but lowest backward participation, in simple global value chains. An increase in forward global value chain participation contributes to the reducing carbon emission intensity of the electro-optical equipment manufacturing industry, particularly in terms of simple global value chain participation. On the other hand, the production length of the backward simple global value chain is positively correlated with the total imported carbon emission intensity, indicating that the longer the simple global value chain of foreign production is included in the industry’s imported intermediate products and the lower the country’s position in the global value chain is, the higher its imported carbon emission intensity is. Upgrade in the global value chain is able to reduce the embodied carbon emissions in the intermediate product exports and total imports.

The development of metropolitan cities inevitably relies on natural resources beyond their boundary through trade of materials and products, particularly within the same urban agglomeration. Meanwhile trade facilitates the optimization of resource allocations under scarcity, among cities and sectors, and therefore generates economic gains. This study constructs an economic evaluation model combining a Multi-Regional Input-Output model and a Data Envelopment Analysis (DEA) to quantify the economic impacts of virtual water trades among the 13 cities in the JingJinJi region (China national capital area), one of the most water-scarce regions in China. We found that the total virtual water trade among the 13 cities amounted to 927 million m³ in 2012, among which agricultural sectors contributed 90% while the industrial sector and service sector together made up the remaining 10%. While Beijing and Tianjin are the main virtual water importers, importing respectively 300.48 and 226.92 million m³ in 2012, Shijiazhuang was the largest virtual water exporter, exporting 173.29 million m³ virtual water in the same year. Due to their more advanced economic conditions, Beijing and Tianjin also have the highest shadow prices of water, at respectively 912.21 and 831.86 CNY per m³, compared to a range of 79.31 to 263.03 CNY per m³ in cities in Hebei. Virtual water flows from cities in Hebei to Beijing and Tianjin thus generate economic gains. It is estimated that virtual water trades in the JingJinJi region have generated a net economic gain of 403.62 billion CNY in 2012, particularly owing to trades of agricultural products from Shijiazhuang to Beijing and Tianjin.

China is the largest electricity producer in the world and more than 70% of its electricity is from coal-fired power plants where water is an indispensable input, primarily for cooling purposes. Water shortages could hamper coal-fired power plants productions and result in economic losses. In this study, we simulate monthly river flows in China on a 0.5° × 0.5° spatial resolution using a calibrated physically based hydrological model, H08, that incorporates human interventions during the current (1981–2014) and future period 2050s (2035–2065) under two carbon emission scenarios Representative Concentration Pathway 2.6 and 8.5. Water demands by individual power plants are calculated based on plant-level data. We define power plants as facing low-flow water risks when the monthly 10 year return low flow is projected to be below the plant’s water withdrawal requirement. We find that around 10% of China’s coal-fired power capacities face low-flow water risks from July to October (the monsoon peak in the eastern Asia), and 20% the rest of the year. Particularly in the North Grid, around 35% to 60% of its regional coal-fired power capacity is at such risks from December to June. Under climate change, low-flow amounts are expected to increase in the current dry northern China except decreasing in the northwest, which is expected to alleviate the low flow water risks facing coal power plants in China except in the Northwest Inland River Basin. In the East and South Grids, if their growing electricity demands continue depending on coal, increasing utilization rate of coal power facilities can lead to heightened demand-driven water risks.