Accurate forecasting of regional energy supply and demand is of great significance for exploring alternative energies and promoting a strategic energy transformation. To support this transformation in China, we predict the Chinese energy demand and explore connections between energy substitution and energy structure transformation. To study how the electric-power substitution (EPS) policy affects energy demand in China, we construct a dynamic management model based on the approach of system dynamics and implement it by using Vensim software. This model is used to simulate and assess how, under different scenarios, the EPS policy affects energy demand and CO2 emissions in China for the period 2015–2035. The simulation shows the indispensable role of the EPS policy in promoting the transformation of China's energy structure.

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