IDEAS home Printed from https://ideas.repec.org/a/eee/rensus/v108y2019icp539-549.html
   My bibliography  Save this article

Subsidy policy discussion on the hydroelectric power substitution for scattered coal consumption: A case study of Sichuan Province

Author

Listed:
  • Pan Lingying,
  • Kui, Zhou
  • Weiqi, Li
  • Fuyuan, Yang
  • Zheng, Li

Abstract

Scattered coal consumption in China has resulted in severe environmental problems in recent years. In the meantime, the rapid increasing capacity of renewable energy has exceeded the demand and therefore leads to idle capacity problem. In this situation, electric power substitution for scattered coal (EPSSC) has become a good choice in meeting this challenge. However, due to high cost for facility replacement and operation, most of the scattered coal users are not willing to adopt electric power facilities without policy subsidies. In this study, the policies of electricity price subsidy (EPS) and facility investment subsidy (FIS) are evaluated as effective methods to promote the willingness of different industries to implement EPSSC. Firstly, based on the principal of net profit-on-investment rate method, a model is established to describe the quantitative relationship between the amount of electric power substitution and the ratio of net profit over investment. Then, a case study of Sichuan Province is performed to discuss the effect of subsidy policies on the potential of EPSSC in four industries, including coal-fired boiler, self-generation coal-fired plant, coal-fired flue-cured tobacco plant and coal-fired building material kiln. Next, an optimization model combined with scenario analysis is proposed to provide the optimum portfolios of different substitution industries under a specific substitution target under different subsidy policies. The results indicate that, electricity price subsidy given to self-generation power plant is more cost-effective, while facility investment subsidy given to electric boiler and electric flue-cured tobacco plant is more cost-effective than the other industries. When the electric power substitution target is higher than 25%, the economic benefit of facility investment subsidy is superior to electricity price subsidy. If both EPS and FIS are implemented at the same time, the subsidy cost will be further reduced.

Suggested Citation

  • Pan Lingying, & Kui, Zhou & Weiqi, Li & Fuyuan, Yang & Zheng, Li, 2019. "Subsidy policy discussion on the hydroelectric power substitution for scattered coal consumption: A case study of Sichuan Province," Renewable and Sustainable Energy Reviews, Elsevier, vol. 108(C), pages 539-549.
    • Handle: RePEc:eee:rensus:v:108:y:2019:i:c:p:539-549
    DOI: 10.1016/j.rser.2019.04.014
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1364032119302266
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.rser.2019.04.014?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Barnett, A. H. & Reutter, Keith & Thompson, Henry, 1998. "Electricity substitution: some local industrial evidence," Energy Economics, Elsevier, vol. 20(4), pages 411-419, September.
    2. Niu, Dong-xiao & Song, Zong-yun & Xiao, Xin-li, 2017. "Electric power substitution for coal in China: Status quo and SWOT analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 610-622.
    3. Jaber, J.O. & Jaber, Q.M. & Sawalha, S.A. & Mohsen, M.S., 2008. "Evaluation of conventional and renewable energy sources for space heating in the household sector," Renewable and Sustainable Energy Reviews, Elsevier, vol. 12(1), pages 278-289, January.
    4. Zhang, Xiang & Jin, Yana & Dai, Hancheng & Xie, Yang & Zhang, Shiqiu, 2019. "Health and economic benefits of cleaner residential heating in the Beijing–Tianjin–Hebei region in China," Energy Policy, Elsevier, vol. 127(C), pages 165-178.
    5. Gao, Jing & Nelson, Robert & Zhang, Lei, 2013. "Substitution in the electric power industry: An interregional comparison in the eastern US," Energy Economics, Elsevier, vol. 40(C), pages 316-325.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wen, Shiyan & Jia, Zhijie, 2022. "The energy, environment and economy impact of coal resource tax, renewable investment, and total factor productivity growth," Resources Policy, Elsevier, vol. 77(C).
    2. Jia, Zong-qian & Zhou, Zhi-fang & Zhang, Hong-jie & Li, Bo & Zhang, You-xian, 2020. "Forecast of coal consumption in Gansu Province based on Grey-Markov chain model," Energy, Elsevier, vol. 199(C).
    3. Olabi, A.G. & Abdelkareem, Mohammad Ali, 2022. "Renewable energy and climate change," Renewable and Sustainable Energy Reviews, Elsevier, vol. 158(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Al-Ghandoor, A. & Jaber, J.O. & Al-Hinti, I. & Mansour, I.M., 2009. "Residential past and future energy consumption: Potential savings and environmental impact," Renewable and Sustainable Energy Reviews, Elsevier, vol. 13(6-7), pages 1262-1274, August.
    2. Suho Bae, 2009. "The responses of manufacturing businesses to geographical differences in electricity prices," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(2), pages 453-472, June.
    3. Mohamed Ali Elleuch & Marwa Mallek & Ahmed Frikha & Wafik Hachicha & Awad M. Aljuaid & Murad Andejany, 2021. "Solving a Multiple User Energy Source Selection Problem Using a Fuzzy Multi-Criteria Group Decision-Making Approach," Energies, MDPI, vol. 14(14), pages 1-16, July.
    4. Sajid Ali & Sang-Moon Lee & Choon-Man Jang, 2017. "Determination of the Most Optimal On-Shore Wind Farm Site Location Using a GIS-MCDM Methodology: Evaluating the Case of South Korea," Energies, MDPI, vol. 10(12), pages 1-22, December.
    5. Ren, Hongbo & Gao, Weijun & Zhou, Weisheng & Nakagami, Ken'ichi, 2009. "Multi-criteria evaluation for the optimal adoption of distributed residential energy systems in Japan," Energy Policy, Elsevier, vol. 37(12), pages 5484-5493, December.
    6. Arvanitopoulos, T. & Agnolucci, P., 2020. "The long-term effect of renewable electricity on employment in the United Kingdom," Renewable and Sustainable Energy Reviews, Elsevier, vol. 134(C).
    7. Yazid Dissou & Reza Ghazal, 2010. "Energy Substitutability in Canadian Manufacturing Econometric Estimation with Bootstrap Confidence Intervals," The Energy Journal, , vol. 31(1), pages 121-148, January.
    8. Ding, Tao & Sun, Yuge & Huang, Can & Mu, Chenlu & Fan, Yuqi & Lin, Jiang & Qin, Yining, 2022. "Pathways of clean energy heating electrification programs for reducing carbon emissions in Northwest China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 166(C).
    9. Shen, Yung-Chi & Chou, Chiyang James & Lin, Grace T.R., 2011. "The portfolio of renewable energy sources for achieving the three E policy goals," Energy, Elsevier, vol. 36(5), pages 2589-2598.
    10. KITAMURA Toshihiko & MANAGI Shunsuke, 2016. "Substitution between Purchased Electricity and Fuel for Onsite Power Generation in the Manufacturing Industry: Plant level analysis in Japan," Discussion papers 16007, Research Institute of Economy, Trade and Industry (RIETI).
    11. Aagreh, Yaser & Al-Ghzawi, Audai, 2013. "Feasibility of utilizing renewable energy systems for a small hotel in Ajloun city, Jordan," Applied Energy, Elsevier, vol. 103(C), pages 25-31.
    12. Lu, Qing & Lü, Shuaikang & Leng, Yajun, 2019. "A Nash-Stackelberg game approach in regional energy market considering users’ integrated demand response," Energy, Elsevier, vol. 175(C), pages 456-470.
    13. Lee, Myunghun, 2013. "The effects of an increase in power rate on energy demand and output price in Korean manufacturing sectors," Energy Policy, Elsevier, vol. 63(C), pages 1217-1223.
    14. Xueliang Li & Bingkang Li & Long Zhao & Huiru Zhao & Wanlei Xue & Sen Guo, 2019. "Forecasting the Short-Term Electric Load Considering the Influence of Air Pollution Prevention and Control Policy via a Hybrid Model," Sustainability, MDPI, vol. 11(10), pages 1-21, May.
    15. Santosh Kumar Sahu & Krishnan Narayanan, 2011. "Total Factor Productivity and Energy Intensity in Indian Manufacturing: A Cross-Sectional Study," International Journal of Energy Economics and Policy, Econjournals, vol. 1(2), pages 47-58, September.
    16. García-Gusano, Diego & Iribarren, Diego & Dufour, Javier, 2018. "Is coal extension a sensible option for energy planning? A combined energy systems modelling and life cycle assessment approach," Energy Policy, Elsevier, vol. 114(C), pages 413-421.
    17. Jaber, Jamal O. & Awad, Wael & Rahmeh, Taieseer Abu & Alawin, Aiman A. & Al-Lubani, Suleiman & Dalu, Sameh Abu & Dalabih, Ali & Al-Bashir, Adnan, 2017. "Renewable energy education in faculties of engineering in Jordan: Relationship between demographics and level of knowledge of senior students’," Renewable and Sustainable Energy Reviews, Elsevier, vol. 73(C), pages 452-459.
    18. Thompson, Henry, 2006. "The applied theory of energy substitution in production," Energy Economics, Elsevier, vol. 28(4), pages 410-425, July.
    19. Peng Zheng & Lingling Zhu & Wei Lu & Xin Yao, 2021. "The effects of electricity substitution in Fujian: based on microdata survey," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(6), pages 9320-9335, June.
    20. Li, Xiao-Ya & Dong, Xin-Yu & Chen, Sha & Ye, Yan-Mei, 2024. "The promising future of developing large-scale PV solar farms in China: A three-stage framework for site selection," Renewable Energy, Elsevier, vol. 220(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:rensus:v:108:y:2019:i:c:p:539-549. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/600126/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.