Analysis of CO2 Abatement Strategies in China’s Electricity

SectorHu Junfeng (胡军峰 )

North China Electric Power UniversityJuly, 2010

Outline

1. Background2. Research Objectives3. Main Partners 4. Analysis Framework5. Completed Research6. Ongoing Research7. Future Research

1. Background

Globally, CO2 emissions were 29.2 billion tons in 2006 (EIA).

Global CO2 emissions need to be reduced to 10 billion tons per year by 2050 to mitigate climate change.

China’s share of global CO2 emissions has rapidly increased, from 8% in 1980 to 21% in 2006; China has replaced the United States as the world’s largest CO2 emitter.

1. Background

The Chinese government set an objective to reduce the CO2 intensity of GDP per capita by 40-45% over 2005 levels by 2020.

The electricity sector is China’s largest CO2 emitter (40% of gross CO2 emissions), and should be specially regulated.

Reduction of CO2 emissions in the electricity sector should include both the demand and the supply side.

1. Background

Supply-side Mitigation Measures Increase the share of non-fossil energy Increase the efficiency of fossil fuel generation Capture and sequester carbon from fossil fuel

generation Reduce transmission losses

Demand-side Mitigation Measures Increase demand-side efficiency (e.g., efficiency

power plants) Adjust industry structure (e.g., through differential

pricing) Develop distributed generation (e.g., PV and CHP)

2. Research Objectives

What policy portfolios can best reduce CO2 intensity in the electricity sector?

How much could electricity sector CO2 emissions be reduced by 2020?

How much should the electricity industry, and society, pay to reduce CO2 emissions intensity by 2020?

What could electricity sector CO2 reductions contribute to the national CO2 intensity goal?

3. Main Partners

Government State Electricity Regulatory Commission (SERC) Climate Change Department, NDRC State Administration of Taxation Ministry of Finance Ministry of Industry and Information Technology

International Organizations Regulatory Assistance Project (RAP) World Bank

Energy and Environmental Economics (E3)

4. Analysis FrameworkM

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Non-fossil fuel generation

Fossil fuel generation

Transmission Distribution

Electricity sector CO2 mitigation policies

CO2 emissions

Economy-wide CO2 emissions

5. Completed Research

A Comparison of Electricity Sector CO2 Emissions between China and the U.S. (2008)

Benefit-Cost Analysis of Differential Pricing Policy (2008)

Benefit-Cost Analysis of “Closing Small Power Plants” Policy (2009)

Development of Wind Power in China (2009) Electricity Sector Supply Planning during the 12th

Five-Year Plan (2010) Generation Costs in Electricity Sector (2010) Adjustments to the Electricity Sector’s

Accounting System (2010)

6. Ongoing Research

Relationship between electricity sector CO2 intensity and cost

Macroeconomic impacts of CO2 emission reduction policies in the electricity sector

Scenarios for electric vehicle development Models for electrical vehicle charging stations Allocation scenarios for a carbon tax in China

7. Future Research

LCA for different generating technologies Renewable energy integration, including

required reserve margins Regional transmission system integration Models for transmission-distribution unbundling Smart grid economics System design for a carbon tax System design for carbon cap and trade Electric vehicle integration Intelligent transportation

谢谢！ Thank you!

Comments Welcome

Hu Junfeng (胡军峰 )

North China Electric Power University

hu-junfeng@sohu.com