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The impact of the CDM (clean development mechanism) on the cost price of wind power electricity: A China study

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  • Zhao, Zhen-Yu
  • Li, Zhi-Wei
  • Xia, Bo

Abstract

As a renewable energy source, wind power is playing an increasingly important role in China's electricity supply. Meanwhile, China is also the world's largest market for clean development mechanism (CDM) wind power projects. Based on the data of 27 wind power projects of Inner Mongolia registered with the Executive Board of the United Nations (EB) in 2010, this paper constructs a financial model of net present value (NPV) to analyze the cost price of wind power electricity. A sensitivity analysis is then conducted to examine the impact of different variables with and without certified emission reduction (CER) income brought about by the CDM. It is concluded that the CDM, along with static investment and annual wind electricity production, is one of the most significant factors in promoting the development of wind power in China. Additionally, wind power is envisaged as a practical proposition for competing with thermal power if the appropriate actions identified in the paper are made.

Suggested Citation

  • Zhao, Zhen-Yu & Li, Zhi-Wei & Xia, Bo, 2014. "The impact of the CDM (clean development mechanism) on the cost price of wind power electricity: A China study," Energy, Elsevier, vol. 69(C), pages 179-185.
    • Handle: RePEc:eee:energy:v:69:y:2014:i:c:p:179-185
    DOI: 10.1016/j.energy.2013.10.050
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    References listed on IDEAS

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    7. Beibei Shi & Lei Wu & Rong Kang, 2021. "Clean Development, Energy Substitution, and Carbon Emissions: Evidence from Clean Development Mechanism (CDM) Project Implementation in China," Sustainability, MDPI, vol. 13(2), pages 1-18, January.
    8. Jin Guo & Hanqiao Yang, 2022. "CDMs’ effect on environmentally sensitive productivity: evidence from Chinese provinces," Letters in Spatial and Resource Sciences, Springer, vol. 15(3), pages 401-422, December.
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    15. Zhou, Shan & Yang, Pu, 2020. "Risk management in distributed wind energy implementing Analytic Hierarchy Process," Renewable Energy, Elsevier, vol. 150(C), pages 616-623.
    16. Catalina Hernández & Rodrigo Barraza & Alejandro Saez & Mercedes Ibarra & Danilo Estay, 2020. "Potential Map for the Installation of Concentrated Solar Power Towers in Chile," Energies, MDPI, vol. 13(9), pages 1-15, April.
    17. Rahman, Shaikh M. & Spalding-Fecher, Randall & Haites, Erik & Kirkman, Grant A., 2018. "The levelized costs of electricity generation by the CDM power projects," Energy, Elsevier, vol. 148(C), pages 235-246.
    18. Gao, Cuixia & Sun, Mei & Geng, Yong & Wu, Rui & Chen, Wei, 2016. "A bibliometric analysis based review on wind power price," Applied Energy, Elsevier, vol. 182(C), pages 602-612.

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