Coal power overcapacity and investment bubble in China during 2015–2020

Jiahai Yuan, Peng Li, Yang Wang, Qian Liu, Xinyi Shen, Kai Zhang and Liansai Dong

Energy Policy, 2016, vol. 97, issue C, 136-144

Abstract: Electricity consumption growth in China has experienced radical adjustment from high speed to medium speed with the advent of new economy normal. However, the investment enthusiasm on coal power remains unabated and leads to continuous operation efficiency deterioration in recent years. In this paper, we quantify the rational capacity and potential investment of coal power in China during the 13th FYP period (2016–2020). By employing power planning model and fully considering the power sector's contribution in the 15% non-fossil primary energy supply target by 2020, we estimate that the reasonable capacity addition space of coal power ranges between 50GW and 100GW, depending on the expected range of demand growth. We find that if all the coal power projects submitted for Environmental Impact Assessment (EIA) approval were put into operation in 2020, capacity excess would reach 200GW. Such huge overcapacity will bring forth disastrous consequences, including enormous investment waste, poor economic performance of generators and more importantly, delay of low-carbon energy transition. Finally, policy recommendations are proposed to address this issue.

Keywords: Coal power; Power planning; Capacity investment; China (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (57)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0301421516303615
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:97:y:2016:i:c:p:136-144

DOI: 10.1016/j.enpol.2016.07.009

Access Statistics for this article

Energy Policy is currently edited by N. France

More articles in Energy Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().