Internalizing externalities into capacity expansion planning: The case of electricity in Vietnam

Khanh Q. Nguyen

Energy, 2008, vol. 33, issue 5, 740-746

Abstract: This paper examines the impacts of including external costs such as environmental and health damages from power production on power generation expansion planning in Vietnam. Using the MARKAL model and covering a 20-year period to 2025, the study shows that there are substantial changes in the generation structure in favor of renewable energy technologies and other low emitting technologies. These changes lead to a reduction in fossil fuel requirements, and consequently, a reduction of CO2, NOx, SO2, and PM emissions which could be expected to also reduce the associated environmental and human health impacts. The avoided external costs would be equivalent to 4.4US cent/kWh. However, these gains are not free as the additional electricity production cost would be around 2.6US cent/kWh higher if the switch to more expensive, but lower emitting technologies were made. The net benefit of internalizing these externalities is thus around 1.8US cent/kWh.

Keywords: Electricity generation; Externalities; Vietnam (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (34)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:energy:v:33:y:2008:i:5:p:740-746

DOI: 10.1016/j.energy.2008.01.014

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