Does the energy-consuming right trading system promote green technology innovation of enterprises?

To achieve the high-quality economic development, China implemented the energy-consuming right trading system, aiming to leverage market-oriented environmental regulations to drive enterprises' green transformation. The purpose of this paper is to figure out whether the energyconsuming right trading system has promoted the green technology innovation of enterprises. Using the empirical analysis method, the paper samples 718 listed industrial enterprises from 2014 to 2019 and constructs a DID model to assess the impact. The results indicate a significant promotion of green technology innovation by the trading system. Non-state-owned and non-highenergy-consuming enterprises exhibit greater sensitivity to the energy-consuming right trading system. Additionally, the institutional environment plays a regulatory role in promoting green innovation of enterprises. Furthermore, it is found that the energy-consuming right trading system influences enterprises by enhancing capital allocation efficiency. The findings are valuable for the government in shaping energy policies and fostering the green transformation of enterprises.