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Carbon emission reduction potential and its influencing factors in China’s coal-fired power industry: a cost optimization and decomposition analysis

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Abstract

China has become the world’s most carbon-emitting country, and the coal-fired power industry (CFPI) dominates China’s carbon emissions. Stimulating the carbon emission reduction potential of China’s CFPI is important for reducing global carbon emissions and mitigating global warming. To explore the potential for reducing carbon emissions in the CFPI, this study constructed a model based on the data envelopment analysis (DEA) method, considering profit motive and the cost of regulatory policy. To analyze the factors influencing carbon reduction potential (CRP), the Kaya-LMDI (Kaya Identity-Logarithmic Mean Divisia Index) method was also applied. Some policy implications for the regions in China came out. The results show that: (a) China’s coal power industry generation process has not yet reached its optimal profit. When China’s CFPI realizes the optimal profit, a CRP will also decrease industrial carbon emissions by 3.54%. (b) At the carbon costs ranging from 16.8 to 95.2 Yuan/ton caused by carbon regulation policy, the total CRP of China’s CFPI would be further enhanced to 4.32%. (c) The coal-fired power output rate and industry scale had a positive effect on CRP, while the labor productivity had a negative effect. Carbon costs caused by carbon regulation policies could promote the CFPI to realize a greater carbon emission reduction potential by adjusting labor productivity and the industry scale effect.

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Acknowledgements

We are grateful for financial support provided by the National Natural Science Foundation of China (Nos. 71922013 and 71834003), Postgraduate Research & Practice Innovation Program of Jiangsu Province (KYCX19_0142), and Nanjing University of Aeronautics and Astronautics PhD short-term visiting scholar project (190608DF09).

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Appendices

Appendix A: optimal results

No.

Area

Labor (\(10^{3} \cdot {\text{persons}}\))

Coal (\(10^{3} \cdot {\text{ton}}\))

Actual value

Optimal value

Difference value

Actual value

Optimal value

Difference value

1

Beijing

90.9

90.9

0

940

940

0

2

Tianjin

43.5

43.5

0

21,234

21,234

0

3

Hebei

187.9

187.9

0

89,303.9

89,303.9

0

4

Shanxi

125.4

116.5

−8.9

103,239.1

102,035.7

−1203.4

5

Inner Mongolia

145.5

140

−5.4

190,377.1

188,687.6

−1689.5

6

Liaoning

146.9

146.9

0

67,133

67,133

0

7

Jilin

123.5

93.2

−30.2

39,560.6

34,544.7

−5015.9

8

Heilongjiang

176

176

0

33,438.8

33,438.8

0

9

Shanghai

43.7

43.6

−0.1

27,833.5

27,766.8

−66.7

10

Jiangsu

145.1

145.1

0

162,754.7

162,754.7

0

11

Zhejiang

119.6

119.6

0

82,091.4

82,091.4

0

12

Anhui

104.5

110.9

6.4

110,545

86,455.9

−24,089.1

13

Fujian

90.6

63.4

−27.2

35,671.7

34,541.4

−1130.3

14

Jiangxi

93.1

93.1

0

31,133.2

31,133.2

0

15

Shandong

230.9

302.4

71.5

201,795.3

187,046.5

−14,748.8

16

Henan

261.8

261.8

0

107,655.4

107,655.4

0

17

Hubei

163.8

165.8

2.1

53,363.5

37,014.3

−16,349.2

18

Hunan

166.2

166.2

0

27,049.2

27,049.2

0

19

Guangdong

312.7

312.7

0

100,638.2

100,638.2

0

20

Guangxi

137.4

118.2

−19.3

20,802

20,376.4

−425.6

21

Hainan

23.4

20.2

−3.2

7587.5

7185.9

−401.6

22

Chongqing

64.3

64.2

−0.1

16,935.3

16,400.2

−535.1

23

Sichuan

231.7

171.2

−60.5

12,395.1

11,155.5

−1239.6

24

Guizhou

122.1

78.3

−43.8

60,211.6

58,566.8

−1644.8

25

Yunnan

106.9

36.3

−70.6

11,218.9

15,321.5

4102.6

26

Shaanxi

136.7

136.7

0

60,901.4

60,901.4

0

27

Gansu

121.9

69.7

−52.2

30,607.9

33,874.4

3266.5

28

Qinghai

21.6

17

−4.6

6924.7

6640.8

−283.9

29

Ningxia

34.6

34.6

0

39,143.8

39,143.8

0

30

Xinjiang

96.5

115.3

18.8

103,801.4

99,530.1

−4271.3

 

Sum

3868.8

3641.3

−227.5

1,856,287.2

1,790,561.5

−65,725.7

No.

Area

Auxiliary Power consumption (\(10^{6} \cdot {\text{kw}}\;{\text{h}}\))

CO2 (\(10^{3} \cdot {\text{ton}}\))

Actual value

Optimal value

Difference value

Actual value

Optimal value

Difference value

1

Beijing

1194

1194

0

2462

2462

0

2

Tianjin

3617

3617

0

55,614

55,614

0

3

Hebei

13,835

13,835

0

233,895.8

233,895.8

0

4

Shanxi

17,387

17,387

0

270,393.5

267,241.7

−3150

5

Inner Mongolia

24,638

24,638

0

498,616.7

494,191.8

−4420

6

Liaoning

8776

8776

0

175,828

175,828

0

7

Jilin

4075

4643

568

103,613.2

90,475.5

−13,140

8

Heilongjiang

5414

5414

0

87,579.6

87,579.6

0

9

Shanghai

3640

3644

4

72,898.7

72,724.1

−170

10

Jiangsu

22,856

22,856

0

426,270.8

426,270.8

0

11

Zhejiang

11,735

11,735

0

215,005.6

215,005.6

0

12

Anhui

9885

9876

−9

289,528.4

226,436.8

−63,090

13

Fujian

4493

4406

−87

93,427.7

90,467.1

−2960

14

Jiangxi

4482

4482

0

81,541

81,541

0

15

Shandong

29,754

25,503

−4251

528,522.1

489,893.5

−38,630

16

Henan

14,077

14,077

0

281,960.3

281,960.3

0

17

Hubei

5418

5418

0

139,764.3

96,944.3

−42,820

18

Hunan

4407

4407

0

70,844.6

70,844.6

0

19

Guangdong

15,818

15,818

0

263,581.5

263,581.5

0

20

Guangxi

3734

3484

−250

54,482.5

53,368

−1110

21

Hainan

1466

1466

0

19,872.4

18,820.5

−1050

22

Chongqing

3185

3185

0

44,355.2

42,953.8

−1400

23

Sichuan

1588

1753

165

32,464

29,217.6

−3146

24

Guizhou

8829

7750

−1079

157,700.2

153,392.3

−4310

25

Yunnan

1915

1631

−284

29,383.4

40,128.7

10,750

26

Shaanxi

9732

9732

0

159,506.9

159,506.9

0

27

Gansu

4131

4799

668

80,165.2

88,720.4

8560

28

Qinghai

1120

985

−136

18,136.5

17,393

−740

29

Ningxia

6661

6661

0

102,521.5

102,521.5

0

30

Xinjiang

14,004

7674

−6330

271,866.2

260,679.4

−11,190

 

Sum

261,865

250,843

−11,022

4,861,802

4,689,660.1

−172,141.9

Appendix B: optimal technology combination

There were 13 regions without the potential for carbon reductions, where the technology scale did not change in 2016 (Fig. 5). The other 17 regions, with carbon emission potential, could change their generation technology. We classified these 17 regions into 3 categories for analysis. 

Fig. 5
figure 5

The optimal technology combination for the CFPI

The first category includes regions where technology scale was reduced, including Inner Mongolia, Fujian, Guangxi, Hainan, Chongqing, Sichuan, Yunnan, and Gansu. In 2016, the costs of the CFPI in these regions were lower than in the previous year, and the power generation was also lower than in the past. This is because the growth of electricity demand in China slowed (Yuan et al., 2016), affecting these areas. Therefore, these regions tended to select the most cost-effective technology and reduced their technology scale to achieve the optimization and CRP in 2016.

The second category includes regions where the technology scale was expanded, including Shanghai, Hubei, Anhui, Jilin, Guizhou, Xinjiang, Shandong, and Qinghai. The cost efficiency of coal-fired power in these regions in 2016 was lower than in the previous year, but the power demand increased. Selecting the most cost-effective technology and expanding its scale allowed the CFPI to achieve cost optimization and carbon reduction in 2016.

The third category includes the region where the production was unchanged: Shanxi. In 2015, the coal-fired power generation technology in the region was most cost-efficient, and the power generation in 2015 was almost equal to the demand in 2016. Therefore, given the generation technology and its scale in 2015, the optimization cost and emission reduction potential in Shanxi could be realized in 2016.

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An, Y., Zhou, D. & Wang, Q. Carbon emission reduction potential and its influencing factors in China’s coal-fired power industry: a cost optimization and decomposition analysis. Environ Dev Sustain 24, 3619–3639 (2022). https://doi.org/10.1007/s10668-021-01579-7

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