IDEAS home Printed from https://ideas.repec.org/a/sae/engenv/v23y2012i1p1-15.html
   My bibliography  Save this article

A Weighted Average Incorporation of Pollution Costs into the Electrical Expansion Planning

Author

Listed:
  • Nir Becker
  • David Soloveitchik
  • Moshe Olshansky

Abstract

In this paper we use the WASP-IV model to estimate the impact of internalizing several environmental external costs on the electricity sector's development plan. The major impact of internalizing the external cost is on fuel use. In the current electricity generation system, more natural gas and less coal have been used. A Cost Benefit Analysis (CBA) of three scenarios has been performed focusing on taxing only one pollutant and looking at its overall implication. The benefit cost ratio was in the range of 4.32 – 5.57 while the net benefit was estimated to be in the range of 82–341 million USD annually. Greenhouse gases (GHG) contribute about 25% of these estimates hence; ancillary benefits are large enough to justify reducing those gases by between 7–12 percents compared to the baseline projection. We also carried a multi-objective analysis among the different scenarios. The weights were on the 3 pollutants (NOx, SO 2 and PM) and CO 2 . Seven scenarios appear in the non-dominated set. Out of them, five appear in every year and hence policy makers ought to place higher weights on them. Out of those five, two are a single tax on one pollutant. Interestingly, most of the non-dominating strategies carry a 0 weight on CO 2 . This gives another justification to internalize externalities based on only local pollutants and so disregards the debate over the desirability of GHG reduction.

Suggested Citation

  • Nir Becker & David Soloveitchik & Moshe Olshansky, 2012. "A Weighted Average Incorporation of Pollution Costs into the Electrical Expansion Planning," Energy & Environment, , vol. 23(1), pages 1-15, January.
    • Handle: RePEc:sae:engenv:v:23:y:2012:i:1:p:1-15
    DOI: 10.1260/0958-305X.23.1.1
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1260/0958-305X.23.1.1
    Download Restriction: no
    File URL: https://libkey.io/10.1260/0958-305X.23.1.1?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
    ---><---

    References listed on IDEAS

    as
    1. Tol, Richard S. J., 2005. "The marginal damage costs of carbon dioxide emissions: an assessment of the uncertainties," Energy Policy, Elsevier, vol. 33(16), pages 2064-2074, November.
    2. Soloveitchik, David & Ben-Aderet, Nissim & Grinman, Mira & Lotov, Alexander, 2002. "Multiobjective optimization and marginal pollution abatement cost in the electricity sector - An Israeli case study," European Journal of Operational Research, Elsevier, vol. 140(3), pages 571-583, August.
    3. Owen, Anthony D., 2006. "Renewable energy: Externality costs as market barriers," Energy Policy, Elsevier, vol. 34(5), pages 632-642, March.
    4. Heinrich, G. & Howells, M. & Basson, L. & Petrie, J., 2007. "Electricity supply industry modelling for multiple objectives under demand growth uncertainty," Energy, Elsevier, vol. 32(11), pages 2210-2229.
    5. Sundqvist, Thomas, 2004. "What causes the disparity of electricity externality estimates?," Energy Policy, Elsevier, vol. 32(15), pages 1753-1766, October.
    6. Nakawiro, Thanawat & Bhattacharyya, Subhes C. & Limmeechokchai, Bundit, 2008. "Electricity capacity expansion in Thailand: An analysis of gas dependence and fuel import reliance," Energy, Elsevier, vol. 33(5), pages 712-723.
    7. Klaassen, Ger & Riahi, Keywan, 2007. "Internalizing externalities of electricity generation: An analysis with MESSAGE-MACRO," Energy Policy, Elsevier, vol. 35(2), pages 815-827, February.
    8. Antunes, C.Henggeler & Martins, A.Gomes & Brito, Isabel Sofia, 2004. "A multiple objective mixed integer linear programming model for power generation expansion planning," Energy, Elsevier, vol. 29(4), pages 613-627.
    9. Roth, Ian F. & Ambs, Lawrence L., 2004. "Incorporating externalities into a full cost approach to electric power generation life-cycle costing," Energy, Elsevier, vol. 29(12), pages 2125-2144.
    10. 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.
    11. Nguyen, Khanh Q., 2008. "Internalizing externalities into capacity expansion planning: The case of electricity in Vietnam," Energy, Elsevier, vol. 33(5), pages 740-746.
    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. Benedykt Pepliński & Wawrzyniec Czubak, 2021. "The Influence of Opencast Lignite Mining Dehydration on Plant Production—A Methodological Study," Energies, MDPI, vol. 14(7), pages 1-29, March.
    2. 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.
    3. Malin Song & Shuhong Wang, 2013. "How Should Developing Countries Cope with Pollution-Migration? An Extended Model of North-South Trade and its Numerical Simulation," Energy & Environment, , vol. 24(6), pages 939-951, October.
    4. 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.

    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. Jacqueline Adelowo & Mathias Mier & Christoph Weissbart, 2021. "Taxation of Carbon Emissions and Air Pollution in Intertemporal Optimization Frameworks with Social and Private Discount Rates," ifo Working Paper Series 360, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    2. Alves, Laura Araujo & Uturbey, Wadaed, 2010. "Environmental degradation costs in electricity generation: The case of the Brazilian electrical matrix," Energy Policy, Elsevier, vol. 38(10), pages 6204-6214, October.
    3. Fahlén, E. & Ahlgren, E.O., 2010. "Accounting for external costs in a study of a Swedish district-heating system - An assessment of environmental policies," Energy Policy, Elsevier, vol. 38(9), pages 4909-4920, September.
    4. Blanco, Herib & Codina, Victor & Laurent, Alexis & Nijs, Wouter & Maréchal, François & Faaij, André, 2020. "Life cycle assessment integration into energy system models: An application for Power-to-Methane in the EU," Applied Energy, Elsevier, vol. 259(C).
    5. Oree, Vishwamitra & Sayed Hassen, Sayed Z. & Fleming, Peter J., 2017. "Generation expansion planning optimisation with renewable energy integration: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 790-803.
    6. Koji Tokimatsu & Louis Dupuy & Nick Hanley, 2019. "Using Genuine Savings for Climate Policy Evaluation with an Integrated Assessment Model," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 72(1), pages 281-307, January.
    7. Lott, Melissa C. & Pye, Steve & Dodds, Paul E., 2017. "Quantifying the co-impacts of energy sector decarbonisation on outdoor air pollution in the United Kingdom," Energy Policy, Elsevier, vol. 101(C), pages 42-51.
    8. Kosugi, Takanobu & Tokimatsu, Koji & Kurosawa, Atsushi & Itsubo, Norihiro & Yagita, Hiroshi & Sakagami, Masaji, 2009. "Internalization of the external costs of global environmental damage in an integrated assessment model," Energy Policy, Elsevier, vol. 37(7), pages 2664-2678, July.
    9. McDonald, N.C. & Pearce, J.M., 2010. "Producer responsibility and recycling solar photovoltaic modules," Energy Policy, Elsevier, vol. 38(11), pages 7041-7047, November.
    10. Zvingilaite, Erika, 2011. "Human health-related externalities in energy system modelling the case of the Danish heat and power sector," Applied Energy, Elsevier, vol. 88(2), pages 535-544, February.
    11. Becerra-Lopez, Humberto R. & Golding, Peter, 2007. "Dynamic exergy analysis for capacity expansion of regional power-generation systems: Case study of far West Texas," Energy, Elsevier, vol. 32(11), pages 2167-2186.
    12. Kudełko, Mariusz, 2021. "Modeling of Polish energy sector – tool specification and results," Energy, Elsevier, vol. 215(PA).
    13. Thopil, George Alex & Pouris, Anastassios, 2015. "Aggregation and internalisation of electricity externalities in South Africa," Energy, Elsevier, vol. 82(C), pages 501-511.
    14. Sadeghi, Hadi & Rashidinejad, Masoud & Abdollahi, Amir, 2017. "A comprehensive sequential review study through the generation expansion planning," Renewable and Sustainable Energy Reviews, Elsevier, vol. 67(C), pages 1369-1394.
    15. Brown, Kristen E. & Henze, Daven K. & Milford, Jana B., 2017. "How accounting for climate and health impacts of emissions could change the US energy system," Energy Policy, Elsevier, vol. 102(C), pages 396-405.
    16. Shih, Yi-Hsuan & Tseng, Chao-Heng, 2014. "Cost-benefit analysis of sustainable energy development using life-cycle co-benefits assessment and the system dynamics approach," Applied Energy, Elsevier, vol. 119(C), pages 57-66.
    17. Enevoldsen, Peter & Sovacool, Benjamin K., 2016. "Integrating power systems for remote island energy supply: Lessons from Mykines, Faroe Islands," Renewable Energy, Elsevier, vol. 85(C), pages 642-648.
    18. Morgan Bazilian & Patrick Nussbaumer & Hans-Holger Rogner & Abeeku Brew-Hammond & Vivien Foster & Shonali Pachauri & Eric Williams & Mark Howells & Philippe Niyongabo & Lawrence Musaba & Brian Ó Galla, 2011. "Energy Access Scenarios to 2030 for the Power Sector in Sub-Saharan Africa," Working Papers 2011.68, Fondazione Eni Enrico Mattei.
    19. Ortega, Margarita & del Río, Pablo & Montero, Eduardo A., 2013. "Assessing the benefits and costs of renewable electricity. The Spanish case," Renewable and Sustainable Energy Reviews, Elsevier, vol. 27(C), pages 294-304.
    20. Yong Zeng & Yanpeng Cai & Guohe Huang & Jing Dai, 2011. "A Review on Optimization Modeling of Energy Systems Planning and GHG Emission Mitigation under Uncertainty," Energies, MDPI, vol. 4(10), pages 1-33, October.

    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:sae:engenv:v:23:y:2012:i:1:p:1-15. 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: SAGE Publications (email available below). General contact details of provider: .

    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.