The net economic benefits of power plants: International evidence

Bao Doan, Duc Hong Vo and Huy Pham

Energy Policy, 2023, vol. 175, issue C

Abstract: Using unique emissions data and prices for carbon dioxide (CO2), this study examines whether the economic benefits of electricity consumption outweigh the environmental cost. Our dataset consists of power plants from 33 countries between 2007 and 2018. We also investigate the net benefits of renewable energy sources, including solar, wind, and hydropower. We find that more environmentally friendly energy has lower CO2 emissions costs and raises electricity consumption. In addition, renewable and nuclear power plants have more economic benefits than thermal ones. All three renewable energy sources have lower CO2 emissions costs and more economic benefits than thermal energy. We also find that the benefit-cost ratio is at least 30 times higher for nuclear and renewable energy than for thermal energy. Our results show that, among the various types of renewable energy, wind and solar power plants show the highest benefit-cost ratio, despite having higher initial investment costs. Our study provides important insights for policy makers that can help them understand the net benefit of various types of power plants and implement appropriate policies and regulations to encourage the use of renewable energy sources as part of achieving their climate change agenda.

Keywords: Economic benefit; Electricity consumption; Environmental cost; Renewables; Thermal energy (search for similar items in EconPapers)
JEL-codes: O44 Q42 Q43 Q48 Q51 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:175:y:2023:i:c:s0301421523000630

DOI: 10.1016/j.enpol.2023.113478

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