Deregulation of power generation planning and elimination of coal power subsidy in China

Jiahai Yuan, Xiaoxuan Guo, Weirong Zhang, Sisi Chen, Yu Ai and Changhong Zhao

Utilities Policy, 2019, vol. 57, issue C, 1-15

Abstract: In this research, we define three kinds of subsidy to coal power under the existing institutional structure in China. They are an environmental subsidy, a squeezing-out renewable subsidy, and a price-protection subsidy. Based on a practical account framework, solid dataset, and reasonable assumptions, we estimate a total subsidy of 263.7 billion Chinese Yuan in 2016. We also provide a reference estimate on environmental subsidy by using the Externality Cost approach. Though these subsidies will be removed by 2020, with the deregulation of the power sector, such a shift will trigger stranded asset risks. We conclude with policy implications for the deregulation of power generation planning and market reform to Chinese policymakers.

Keywords: Coal power subsidy; Power generation planning; Energy market reform; China (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:57:y:2019:i:c:p:1-15

DOI: 10.1016/j.jup.2019.01.007

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