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Co-firing Coal with Biomass under Mandatory Obligation for Renewable Electricity: Implication for the Electricity Mix

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  • Vincent Bertrand

Abstract

This paper analyses the effect of recognizing co-firing coal with biomass as renewable electricity. We provide simulations for the French and German electricity mix. Results indicate that, if co-firing is recognized as a renewable, coal may crowd-out traditional renewables with increased generation and additional investments. Regarding CO2 emissions, we find surges when co-firing is recognized as a renewable. The rise is more significant in Germany due to greater coal capacity. In France, the magnitude depends on the share of nuclear with a lower increase when old nuclear plants are prolonged. Finally, we find that recognizing co-firing as a renewable reduces the overall costs for electricity. We balance the cost saving with the increased social cost from higher CO2 emissions. Results show that the cost saving is lower than the increased carbon cost for society with carbon valuation around 100 Euros/tCO2, except in France when old nuclear plants are not decommissioned.

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  • Vincent Bertrand, 2019. "Co-firing Coal with Biomass under Mandatory Obligation for Renewable Electricity: Implication for the Electricity Mix," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4).
    • Handle: RePEc:aen:journl:ej40-4-bertran
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    1. Weigt, Hannes & Ellerman, Denny & Delarue, Erik, 2013. "CO2 abatement from renewables in the German electricity sector: Does a CO2 price help?," Energy Economics, Elsevier, vol. 40(S1), pages 149-158.
    2. Vincent Bertrand & Elodie Le Cadre, 2015. "Simulating the use of biomass in electricity with the green electricity simulate model: An application to the French power generation," Working Papers 1503, Chaire Economie du climat.
    3. Rentizelas, Athanasios A. & Tolis, Athanasios I. & Tatsiopoulos, Ilias P., 2012. "Investment planning in electricity production under CO2 price uncertainty," International Journal of Production Economics, Elsevier, vol. 140(2), pages 622-629.
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    • F0 - International Economics - - General

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