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Costs and CO2 emissions of technological transformation in China's power industry: The impact of market regulation and assistive technologies

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  • Zhang, Yingnan
  • Wu, Guanqi
  • Zhang, Bin

Abstract

This study explores the transformation pathways of China's power industry from 2020 to 2060 using the "Dynamic System and Low Emissions Analysis Platform" (SD-LEAP) model. The analysis assumes market regulation mechanisms include the carbon emission trading (CET) and the tradable green certificate (TGC) market, while assistive technologies encompass Carbon Capture, Utilization, and Storage (CCUS) and energy storage. The study evaluates costs and CO2 emissions under these influences. Our findings indicate higher CET prices reduce fossil and biomass energy capacity, while higher TGC prices boost clean energy capacity. CCUS implementation and increased CET prices lower fossil power generation costs. Conversely, higher TGC prices and advances in energy storage raise renewable energy capacity and costs by 2060. Combined market regulations and assistive technologies are projected to reduce CO2 emissions by 509.3 to 1466.3 million tons by 2060, with policy recommendations for supporting China's power system development.

Suggested Citation

  • Zhang, Yingnan & Wu, Guanqi & Zhang, Bin, 2025. "Costs and CO2 emissions of technological transformation in China's power industry: The impact of market regulation and assistive technologies," Structural Change and Economic Dynamics, Elsevier, vol. 73(C), pages 211-222.
    • Handle: RePEc:eee:streco:v:73:y:2025:i:c:p:211-222
    DOI: 10.1016/j.strueco.2025.01.001
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