Urban energy planning, policy orientation and green innovation incentives: evidence from Chinese listed companies

Purpose – The purpose of this study is to investigate whether urban energy planning can effectively guide enterprises in practicing green development concepts. Design/methodology/approach – Using China’s New Energy Demonstration City Pilot Policy (NEDC) as an exogenous shock, this study uses a difference-in-differences model to evaluate the impact of urban energy planning on corporate green innovation. Findings – This study finds that NEDC significantly enhances green innovation among enterprises in pilot areas, with this effect being particularly evident in non-state-owned enterprises and high-energy-consuming industries. Further investigation reveals that NEDC produces both a catering effect, guiding firms to adopt strategic green innovations, and an incentive effect, spurring firms toward substantial green innovation. Notably, there is no evidence indicating significant spillover effects from the pilot policy. Practical implications – This study comprehensively reveals the mechanisms through which NEDC induces corporate green innovation, providing decision-making support for guiding enterprises in practicing green development concepts and enhancing supporting policies. Social implications – This study indicates that urban energy planning is significantly influenced by local policy directions, necessitating policymakers to continuously refine policy implementation methods and establish scientifically sound long-term mechanisms to promote regional sustainable development. Originality/value – This study provides new empirical evidence from the perspective of corporate green innovation to validate the feasibility of NEDC. Furthermore, it delves into the underlying logic of policy effect differentiation, providing insights for policymakers to refine supporting policies.