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Decisions in Power Supply Chain with Emission Reduction Effort of Coal-Fired Power Plant under the Power Market Reform

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  • Lingyan Xu

    (Management School, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, China
    Department of Systems Design Engineering, University of Waterloo, Waterloo, ON N2L 3G1, Canada)

  • Fenglian Huang

    (Management School, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, China)

  • Jianguo Du

    (Management School, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, China)

  • Dandan Wang

    (Management School, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, China)

Abstract

Sustainability in power supply chain has been supported by emission reduction of coal-fired power generation and increasing renewable energy power generation. Under the power market reform of direct power purchase transactions, this paper focuses on the channel selection and emission reduction decisions of power supply chain. From the theoretical perspective, this paper develops the decision-making models of centralized and decentralized power supply chain, which consist of one renewable energy power generation enterprise, one coal-fired power plant and one power grid enterprise. The optimal strategies of power quantities and profits for power supply chain members and their corresponding numerical experiments are analyzed in different cases. The results show that there are q A 1 N c * < q A 1 L c * for renewable energy power generation enterprise A, q B 1 N c * > q B 1 L c * and e B N c * > e B L c * for coal-fired power plant B, which indicate that the direct power purchase channel in the centralized scenario is conducive to promoting the transaction quantity of renewable energy power generation, as well as the on-grid power quantity and emission reduction efforts of coal-fired power plant B. Furthermore, the profit of whole power supply chain could be enhanced by the increasing on-grid power preference coefficient of coal-fired power generation, subsidy for renewable energy power generation and preference coefficient for clean production, and by the decreasing emission reduction cost coefficient of coal-fired power plant. Additionally, the emission reduction effort of coal-fired power plant is positively relevant with preference coefficient for clean production, whereas it is negatively relevant with power grid wheeling charge, emission reduction cost coefficient and subsidy for renewable energy power generation. Our findings can provide useful managerial insights for policymakers and enterprises in the sustainability of power supply chain.

Suggested Citation

  • Lingyan Xu & Fenglian Huang & Jianguo Du & Dandan Wang, 2020. "Decisions in Power Supply Chain with Emission Reduction Effort of Coal-Fired Power Plant under the Power Market Reform," Sustainability, MDPI, vol. 12(16), pages 1-30, August.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:16:p:6582-:d:398939
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    References listed on IDEAS

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