Most households in China have had no incentive to conserve their heating usage because heating payment has been a fixed payment regardless of their usage. In this project, the researchers are evaluating a recent major reform in the residential heating system in China that replaced a non-metered fixed payment system with a two-part tariff that is a combination of a fixed fee and a marginal price per usage. A key advantage is that some households started the new pricing in earlier years, and others started later, allowing the researchers to exploit this design to estimate a causal impact of this new pricing on heating usage. Preliminary estimates suggested that the policy reduced heating usage nearly 15 percent in the first year, 30 percent in the second year, and 35 percent in the following years, delivering a social welfare gain of $253 million per year.