The energy transition has emerged as a significant challenge that will influence China’s decarbonization plan in the forthcoming decades. Grounded in the Porter Hypothesis and the resource-based view, this study examines how three regulatory instruments, named command-control (CER), market-incentive (MER), and voluntary (VER), shape firms’ adoption of sustainable energy technologies (SETs) in China’s renewable energy sector, and how internal energy transition capabilities condition these effects. Survey data from 273 Chinese renewable energy firms were analyzed using partial least squares structural equation modeling (PLS-SEM). Results reveal heterogeneous regulation and technology linkages. CER and MER are positively associated with the uptake of energy-saving technologies (EST) and waste management/resource recovery (WM), but neither shows a significant relationship with renewable electricity (RE). By contrast, VER is linked to higher adoption of RE and EST, while its association with WM is not significant. Moderation tests indicate that firms’ energy transition capabilities generally amplify the influence of CER, have limited or even negative moderate effects on the relationship between MER and VER with SETs. This study emphasizes that effectively designed regulations and incentives are crucial instruments for encouraging SETs utilization. Policymakers need to improve regulatory frameworks that integrate enforceable standards with market signals and capability development to accelerate SETs diffusion, while enterprises should invest in organizational capacity building to adapt to changing environment regulations and convert regulatory signals into economically meaningful energy transitions.
Lyu et al. (Wed,) studied this question.