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Implementing China's national energy conservation policies at state-owned electric power generation plants

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  • Zhao, Xiaofan
  • Ortolano, Leonard

Abstract

China's 11th Five-Year Guideline identified energy conservation as one of the country's fundamental policies and established a mandatory target: 20% reduction in national average energy intensity by 2010. Despite the various policies, laws, and administrative reforms to support energy conservation, China fell behind schedule for meeting its conservation targets in 2006 and 2007. Using a combination of available literature and an interview-based case study, this paper examines the implementation of energy conservation and investigates impediments to achieving China's conservation goal in the electric power generation sector. Three key impediments are detailed: (1) municipal governments' incentives to overlook conservation-related central directives primarily because of budget pressures linked to financial decentralization, (2) procedural obstacles in the form of time required to obtain project approvals for high-efficiency power generation units, and (3) financial obstacles making it difficult for power generation enterprises to raise capital for energy conservation projects. An interview-based case study of a state-owned coal-fired electric power generation company demonstrates the influence of the aforementioned obstacles. While procedural obstacles are notable, they can be managed. However, electricity pricing reforms and/or stronger subsidy programs will be needed to address the financial obstacles facing Chinese power generation companies.

Suggested Citation

  • Zhao, Xiaofan & Ortolano, Leonard, 2010. "Implementing China's national energy conservation policies at state-owned electric power generation plants," Energy Policy, Elsevier, vol. 38(10), pages 6293-6306, October.
  • Handle: RePEc:eee:enepol:v:38:y:2010:i:10:p:6293-6306
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    References listed on IDEAS

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    Cited by:

    1. Zha, Donglan & Ding, Ning, 2014. "Elasticities of substitution between energy and non-energy inputs in China power sector," Economic Modelling, Elsevier, vol. 38(C), pages 564-571.
    2. Lo, Kevin & Wang, Mark Y., 2013. "Energy conservation in China’s Twelfth Five-Year Plan period: Continuation or paradigm shift?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 18(C), pages 499-507.
    3. Yan, Huijie, 2015. "Provincial energy intensity in China: The role of urbanization," Energy Policy, Elsevier, vol. 86(C), pages 635-650.
    4. Karplus, Valerie J. & Rausch, Sebastian & Zhang, Da, 2016. "Energy caps: Alternative climate policy instruments for China?," Energy Economics, Elsevier, vol. 56(C), pages 422-431.
    5. Cao, Wensheng & Bluth, Christoph, 2013. "Challenges and countermeasures of China’s energy security," Energy Policy, Elsevier, vol. 53(C), pages 381-388.
    6. Zhao, Xiaofan & Li, Huimin & Wu, Liang & Qi, Ye, 2014. "Implementation of energy-saving policies in China: How local governments assisted industrial enterprises in achieving energy-saving targets," Energy Policy, Elsevier, vol. 66(C), pages 170-184.
    7. Zhou, Kaile & Yang, Shanlin & Shen, Chao & Ding, Shuai & Sun, Chaoping, 2015. "Energy conservation and emission reduction of China’s electric power industry," Renewable and Sustainable Energy Reviews, Elsevier, vol. 45(C), pages 10-19.
    8. Jiang, Suqin & Chen, Zun & Shan, Li & Chen, Xinyu & Wang, Haikun, 2017. "Committed CO2 emissions of China's coal-fired power generators from 1993 to 2013," Energy Policy, Elsevier, vol. 104(C), pages 295-302.
    9. Majidpour, Mehdi, 2012. "Heavy duty gas turbines in Iran, India and China: Do national energy policies drive the industries?," Energy Policy, Elsevier, vol. 41(C), pages 723-732.
    10. Chen, Jinjin, 2011. "China's experiment on the differential electricity pricing policy and the struggle for energy conservation," Energy Policy, Elsevier, vol. 39(9), pages 5076-5085, September.
    11. Zhao, Xiaofan & Wu, Liang, 2016. "Interpreting the Evolution of the Energy-Saving Target Allocation System in China (2006–13): A View of Policy Learning," World Development, Elsevier, vol. 82(C), pages 83-94.
    12. Chen, Hao & Kang, Jia-Ning & Liao, Hua & Tang, Bao-Jun & Wei, Yi-Ming, 2017. "Costs and potentials of energy conservation in China's coal-fired power industry: A bottom-up approach considering price uncertainties," Energy Policy, Elsevier, vol. 104(C), pages 23-32.
    13. Fang, Zheng & Chen, Yang, 2017. "Electricity consumption, Education Expenditure and Economic Growth in Chinese Cities," RIEI Working Papers 2017-02, Xi'an Jiaotong-Liverpool University, Research Institute for Economic Integration.
    14. repec:gam:jsusta:v:9:y:2017:i:5:p:686-:d:96881 is not listed on IDEAS

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