This study analyzes the effects of technological progress for the elasticity of energy consumption from 2002 to 2030 in China by a dynamic computable general equilibrium model. The technological progress is represented by a combination of industrial technology upgrading and energy efficiency improvement. Household is divided into two groups as rural type and urban type. The parameters about technological progress and urbanization are all introduced exogenously. Simulation results show that vigorously pushing advanced energy efficiency technologies through financial policy incentives is the key to realize effective energy-saving achievement while promoting economic growth in China.