IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v8y2015i2p1440-1467d45883.html
   My bibliography  Save this article

Monetization of External Costs Using Lifecycle Analysis—A Comparative Case Study of Coal-Fired and Biomass Power Plants in Northeast China

Author

Listed:
  • Lingling Wang

    (Graduate School of Engineering, Kochi University of Technology, Miyanokuchi 185, Tosayamada-cho, Kami City, Kochi 782-0003, Japan)

  • Tsunemi Watanabe

    (School of Management, Kochi University of Technology, Miyanokuchi 185, Tosayamada-cho, Kami City, Kochi 782-0003, Japan)

  • Zhiwei Xu

    (State Grid Heilongjiang Electric Power Company Limited, 301 Hanshui Road, Nangang District, Harbin 150090, China)

Abstract

In this study, the structures of external costs are built in line with coal-fired and biomass power plant life cycle activities in Northeast China. The external cost of coal-fired and biomass power plants was compared, using the lifecycle approach. In addition, the external costs of a biomass power plant are calculated for each stage for comparison with those of a coal-fired power plant. The results highlight that the external costs of a coal-fired plant are 0.072 US $/kWh, which are much higher than that of a biomass power plant, 0.00012 US$/kWh. The external cost of coal-fired power generation is as much as 90% of the current price of electricity generated by coal, while the external cost of a biomass power plant is 1/1000 of the current price of electricity generated by biomass. In addition, for a biomass power plant, the external cost associated with SO 2 , NO X , and PM 2.5 are particularly lower than those of a coal-fired power plant. The prospect of establishing precise estimations for external cost mechanisms and sustainable energy policies is discussed to show a possible direction for future energy schemes in China. The paper has significant value for supporting the biomass power industry and taxing or regulating coal-fired power industry to optimize the energy structure in China.

Suggested Citation

  • Lingling Wang & Tsunemi Watanabe & Zhiwei Xu, 2015. "Monetization of External Costs Using Lifecycle Analysis—A Comparative Case Study of Coal-Fired and Biomass Power Plants in Northeast China," Energies, MDPI, vol. 8(2), pages 1-28, February.
    • Handle: RePEc:gam:jeners:v:8:y:2015:i:2:p:1440-1467:d:45883
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/8/2/1440/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/8/2/1440/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    2. Cai, Wenjia & Wang, Can & Wang, Ke & Zhang, Ying & Chen, Jining, 2007. "Scenario analysis on CO2 emissions reduction potential in China's electricity sector," Energy Policy, Elsevier, vol. 35(12), pages 6445-6456, December.
    3. Du, Limin & He, Yanan & Yan, Jianye, 2013. "The effects of electricity reforms on productivity and efficiency of China's fossil-fired power plants: An empirical analysis," Energy Economics, Elsevier, vol. 40(C), pages 804-812.
    4. Stirling, Andrew, 1997. "Limits to the value of external costs," Energy Policy, Elsevier, vol. 25(5), pages 517-540, April.
    5. Shafie, S.M. & Mahlia, T.M.I. & Masjuki, H.H., 2013. "Life cycle assessment of rice straw co-firing with coal power generation in Malaysia," Energy, Elsevier, vol. 57(C), pages 284-294.
    6. Rafaj, Peter & Kypreos, Socrates, 2007. "Internalisation of external cost in the power generation sector: Analysis with Global Multi-regional MARKAL model," Energy Policy, Elsevier, vol. 35(2), pages 828-843, February.
    7. Mahapatra, Diptiranjan & Shukla, Priyadarshi & Dhar, Subash, 2012. "External cost of coal based electricity generation: A tale of Ahmedabad city," Energy Policy, Elsevier, vol. 49(C), pages 253-265.
    8. Hendryx, M. & Ahern, M.M., 2008. "Relations between health indicators and residential proximity to coal mining in West Virginia," American Journal of Public Health, American Public Health Association, vol. 98(4), pages 669-671.
    9. Rentizelas, Athanasios & Georgakellos, Dimitrios, 2014. "Incorporating life cycle external cost in optimization of the electricity generation mix," Energy Policy, Elsevier, vol. 65(C), pages 134-149.
    10. Schleisner, Lotte, 2000. "Comparison of methodologies for externality assessment," Energy Policy, Elsevier, vol. 28(15), pages 1127-1136, December.
    11. Darwin C. Hall, 1990. "Preliminary Estimates Of Cumulative Private And External Costs Of Energy," Contemporary Economic Policy, Western Economic Association International, vol. 8(3), pages 283-307, July.
    12. Dimitrijevic, Zinaida & Tatic, Kasim & Knezevic, Aleksandar & Salihbegovic, Iris, 2011. "External costs from coal-fired thermal plants and sulphur dioxide emission limit values for new plants in Bosnia and Herzegovina," Energy Policy, Elsevier, vol. 39(6), pages 3036-3041, June.
    13. Castelo Branco, David A. & Moura, Maria Cecilia P. & Szklo, Alexandre & Schaeffer, Roberto, 2013. "Emissions reduction potential from CO2 capture: A life-cycle assessment of a Brazilian coal-fired power plant," Energy Policy, Elsevier, vol. 61(C), pages 1221-1235.
    14. Wang, Ke & Wang, Can & Lu, Xuedu & Chen, Jining, 2007. "Scenario analysis on CO2 emissions reduction potential in China's iron and steel industry," Energy Policy, Elsevier, vol. 35(4), pages 2320-2335, April.
    15. Heller, Martin C & Keoleian, Gregory A & Mann, Margaret K & Volk, Timothy A, 2004. "Life cycle energy and environmental benefits of generating electricity from willow biomass," Renewable Energy, Elsevier, vol. 29(7), pages 1023-1042.
    16. Oecd, 2009. "Climate Change and Africa," OECD Journal: General Papers, OECD Publishing, vol. 2009(1), pages 5-35.
    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. Margarida Casau & Diana C. M. Cancela & João C. O. Matias & Marta Ferreira Dias & Leonel J. R. Nunes, 2021. "Coal to Biomass Conversion as a Path to Sustainability: A Hypothetical Scenario at Pego Power Plant (Abrantes, Portugal)," Resources, MDPI, vol. 10(8), pages 1-20, August.
    2. Reeko Watanabe & Tsunemi Watanabe, 2020. "The Development of Straw-Based Biomass Power Generation in Rural Area in Northeast China—An Institutional Analysis Grounded in a Risk Management Perspective," Sustainability, MDPI, vol. 12(5), pages 1-22, March.
    3. Lingling Wang & Tsunemi Watanabe, 2016. "A Stackelberg Game Theoretic Analysis of Incentive Effects under Perceived Risk for China’s Straw-Based Power Plant Supply Chain," Energies, MDPI, vol. 9(6), pages 1-20, June.
    4. Mojtaba Jorli & Steven Van Passel & Hossein Sadeghi Saghdel, 2018. "External costs from fossil electricity generation: A review of the applied impact pathway approach," Energy & Environment, , vol. 29(5), pages 635-648, August.
    5. Lingling Wang & Tsunemi Watanabe, 2017. "Influence of Trust on Biomass Supply Decision-Making in China," Energies, MDPI, vol. 10(11), pages 1-19, October.
    6. Benedykt Pepliński, 2021. "External Costs for Agriculture from Lignite Extraction from the Złoczew Deposit," Energies, MDPI, vol. 14(9), pages 1-27, May.
    7. Chen, Hao & Tang, Bao-Jun & Liao, Hua & Wei, Yi-Ming, 2016. "A multi-period power generation planning model incorporating the non-carbon external costs: A case study of China," Applied Energy, Elsevier, vol. 183(C), pages 1333-1345.
    8. Bin Ye & Jingjing Jiang & Lixin Miao & Peng Yang & Ji Li & Bo Shen, 2015. "Feasibility Study of a Solar-Powered Electric Vehicle Charging Station Model," Energies, MDPI, vol. 8(11), pages 1-19, November.
    9. Xiaonan Wang & Licheng Wang & Jianping Chen & Shouting Zhang & Paolo Tarolli, 2020. "Assessment of the External Costs of Life Cycle of Coal: The Case Study of Southwestern China," Energies, MDPI, vol. 13(15), pages 1-26, August.
    10. Mojtaba Jorli & Steven Van Passel & Hossein Sadeghi & Alireza Nasseri & Lotfali Agheli, 2017. "Estimating Human Health Impacts and Costs Due to Iranian Fossil Fuel Power Plant Emissions through the Impact Pathway Approach," Energies, MDPI, vol. 10(12), pages 1-29, December.
    11. Huadong Gao & Baifu An & Zhen Han & Yachao Guo & Zeyu Ruan & Wei Li & Samuel Zayzay, 2020. "The Sustainable Development of Aged Coal Mine Achieved by Recovering Pillar-Blocked Coal Resources," Energies, MDPI, vol. 13(15), pages 1-12, July.
    12. Barbara Tchórzewska-Cieślak & Katarzyna Pietrucha-Urbanik, 2018. "Approaches to Methods of Risk Analysis and Assessment Regarding the Gas Supply to a City," Energies, MDPI, vol. 11(12), pages 1-13, November.
    13. Ali, Ghaffar & Bashir, Muhammad Khalid & Ali, Hassan & Bashir, Muhammad Hamid, 2016. "Utilization of rice husk and poultry wastes for renewable energy potential in Pakistan: An economic perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 61(C), pages 25-29.
    14. Xiaowei Feng & Nong Zhang & Xiaoting Chen & Lianyuan Gong & Chuangxin Lv & Yu Guo, 2016. "Exploitation Contradictions Concerning Multi-Energy Resources among Coal, Gas, Oil, and Uranium: A Case Study in the Ordos Basin (Western North China Craton and Southern Side of Yinshan Mountains)," Energies, MDPI, vol. 9(2), pages 1-15, February.
    15. Wang, Yihan & Chen, Chen & Tao, Yuan & Wen, Zongguo & Chen, Bin & Zhang, Hong, 2019. "A many-objective optimization of industrial environmental management using NSGA-III: A case of China’s iron and steel industry," Applied Energy, Elsevier, vol. 242(C), pages 46-56.
    16. Vojtěch Máca & Jan Melichar, 2016. "The Health Costs of Revised Coal Mining Limits in Northern Bohemia," Energies, MDPI, vol. 9(2), pages 1-20, January.
    17. Wang, Lingling & Watanabe, Tsunemi, 2019. "Effects of environmental policy on public risk perceptions of haze in Tianjin City: A difference-in-differences analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 109(C), pages 199-212.
    18. Ziying Yang & Manping Tang, 2019. "Welfare Analysis of Government Subsidy Programs for Fuel-Efficient Vehicles and New Energy Vehicles in China," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(2), pages 911-937, October.
    19. Shahsavari, Amir & Akbari, Morteza, 2018. "Potential of solar energy in developing countries for reducing energy-related emissions," Renewable and Sustainable Energy Reviews, Elsevier, vol. 90(C), pages 275-291.

    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. Mahapatra, Diptiranjan & Shukla, Priyadarshi & Dhar, Subash, 2012. "External cost of coal based electricity generation: A tale of Ahmedabad city," Energy Policy, Elsevier, vol. 49(C), pages 253-265.
    2. Jintao Lu & Chong Zhang & Licheng Ren & Mengshang Liang & Wadim Strielkowski & Justas Streimikis, 2020. "Evolution of External Health Costs of Electricity Generation in the Baltic States," IJERPH, MDPI, vol. 17(15), pages 1-22, July.
    3. Chen, Hao & Tang, Bao-Jun & Liao, Hua & Wei, Yi-Ming, 2016. "A multi-period power generation planning model incorporating the non-carbon external costs: A case study of China," Applied Energy, Elsevier, vol. 183(C), pages 1333-1345.
    4. Selim Karkour & Yuki Ichisugi & Amila Abeynayaka & Norihiro Itsubo, 2020. "External-Cost Estimation of Electricity Generation in G20 Countries: Case Study Using a Global Life-Cycle Impact-Assessment Method," Sustainability, MDPI, vol. 12(5), pages 1-35, March.
    5. Kudełko, Mariusz, 2021. "Modeling of Polish energy sector – tool specification and results," Energy, Elsevier, vol. 215(PA).
    6. Yuhuan Zhao & Hao Li & Zhonghua Zhang & Yongfeng Zhang & Song Wang & Ya Liu, 2017. "Decomposition and scenario analysis of CO2 emissions in China’s power industry: based on LMDI method," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 86(2), pages 645-668, March.
    7. Vithayasrichareon, Peerapat & MacGill, Iain F., 2012. "A Monte Carlo based decision-support tool for assessing generation portfolios in future carbon constrained electricity industries," Energy Policy, Elsevier, vol. 41(C), pages 374-392.
    8. Sundqvist, Thomas, 2004. "What causes the disparity of electricity externality estimates?," Energy Policy, Elsevier, vol. 32(15), pages 1753-1766, October.
    9. Kermeli, Katerina & Edelenbosch, Oreane Y. & Crijns-Graus, Wina & van Ruijven, Bas J. & van Vuuren, Detlef P. & Worrell, Ernst, 2022. "Improving material projections in Integrated Assessment Models: The use of a stock-based versus a flow-based approach for the iron and steel industry," Energy, Elsevier, vol. 239(PE).
    10. Perwez, Usama & Sohail, Ahmed & Hassan, Syed Fahad & Zia, Usman, 2015. "The long-term forecast of Pakistan's electricity supply and demand: An application of long range energy alternatives planning," Energy, Elsevier, vol. 93(P2), pages 2423-2435.
    11. An, Runying & Yu, Biying & Li, Ru & Wei, Yi-Ming, 2018. "Potential of energy savings and CO2 emission reduction in China’s iron and steel industry," Applied Energy, Elsevier, vol. 226(C), pages 862-880.
    12. Wang, Yanxiang & Ali Almazrooei, Shaikha & Kapsalyamova, Zhanna & Diabat, Ali & Tsai, I-Tsung, 2016. "Utility subsidy reform in Abu Dhabi: A review and a Computable General Equilibrium analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 55(C), pages 1352-1362.
    13. Kale, Rajesh V. & Pohekar, Sanjay D., 2014. "Electricity demand and supply scenarios for Maharashtra (India) for 2030: An application of long range energy alternatives planning," Energy Policy, Elsevier, vol. 72(C), pages 1-13.
    14. Rentizelas, Athanasios & Georgakellos, Dimitrios, 2014. "Incorporating life cycle external cost in optimization of the electricity generation mix," Energy Policy, Elsevier, vol. 65(C), pages 134-149.
    15. Jochem, Patrick & Doll, Claus & Fichtner, Wolf, 2016. "External costs of electric vehicles," MPRA Paper 91602, University Library of Munich, Germany.
    16. Galiya Movkebayeva & Aliya Aktymbayeva & Yuliya Tyurina & Nurken Baikadamov & Kamar Beketova & Marija Troyanskaya & Sholpan Smagulova & Aizhan Imangaliyeva, 2020. "Energy Security and Sustainability in Eurasian Economic Union in the Terms of Economic Growth: The Case of Kazakhstan s Energy Sector up to 2040 Perspectives," International Journal of Energy Economics and Policy, Econjournals, vol. 10(2), pages 497-503.
    17. Gao, Tianming & Shen, Lei & Shen, Ming & Liu, Litao & Chen, Fengnan & Gao, Li, 2017. "Evolution and projection of CO2 emissions for China's cement industry from 1980 to 2020," Renewable and Sustainable Energy Reviews, Elsevier, vol. 74(C), pages 522-537.
    18. Li, Yongliang & Cao, Hui & Wang, Shuhao & Jin, Yi & Li, Dacheng & Wang, Xiang & Ding, Yulong, 2014. "Load shifting of nuclear power plants using cryogenic energy storage technology," Applied Energy, Elsevier, vol. 113(C), pages 1710-1716.
    19. Alshammari, Yousef M. & Sarathy, S. Mani, 2017. "Achieving 80% greenhouse gas reduction target in Saudi Arabia under low and medium oil prices," Energy Policy, Elsevier, vol. 101(C), pages 502-511.
    20. Zhu, Bing & Zhou, Wenji & Hu, Shanying & Li, Qiang & Griffy-Brown, Charla & Jin, Yong, 2010. "CO2 emissions and reduction potential in China’s chemical industry," Energy, Elsevier, vol. 35(12), pages 4663-4670.

    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:gam:jeners:v:8:y:2015:i:2:p:1440-1467:d:45883. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.