The Health and Climate Benefits of Economic Dispatch in China’s Power System

Qian Luo, Fernando Garcia-Menendez, Haozhe Yang, Ranjit Deshmukh, Gang He, Jiang Lin and Jeremiah X Johnson

Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series from Department of Agricultural & Resource Economics, UC Berkeley

Abstract: China's power system is highly regulated and uses an "equal-share" dispatch approach. However, market mechanisms are being introduced to reduce generation costs and improve system reliability. Here, we quantify the climate and human health impacts brought about by this transition, modeling China's power system operations under economic dispatch. We find that significant reductions in mortality related to air pollution (11%) and CO 2 emissions (3%) from the power sector can be attained by economic dispatch, relative to the equal-share approach, through more efficient coal-powered generation. Additional health and climate benefits can be achieved by incorporating emission externalities in electricity generation costs. However, the benefits of the transition to economic dispatch will be unevenly distributed across China and may lead to increased health damage in some regions. Our results show the potential of dispatch decision-making in electricity generation to mitigate the negative impacts of power plant emissions with existing facilities in China.

Keywords: Economics; Applied Economics; Climate Action; Humans; Reproducibility of Results; Air Pollution; Climate; Coal; Power Plants; China; Carbon Dioxide; power system in China; air pollution; public health; Environmental Sciences (search for similar items in EconPapers)
Date: 2023-02-21
New Economics Papers: this item is included in nep-cna, nep-ene, nep-env, nep-mac and nep-reg
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Citations: View citations in EconPapers (1)

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