Cost–Benefit Analysis of the China’s Household Coal-to-Electricity Transition: A Case Study on the Beijing Mentougou Area

Yanran Pan, Lei Jiang and Hui Wang ()
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Yanran Pan: School of Economics and Management, Beijing Forestry University, Beijing 100083, China
Lei Jiang: Ecology and Environment Bureau of Mentougou District of Beijing Municipality, Beijing 100041, China
Hui Wang: School of Economics and Management, Beijing Forestry University, Beijing 100083, China

Energies, 2024, vol. 17, issue 23, 1-23

Abstract: Since 2013, China has implemented clean heating projects such as the coal-to-electricity project to reduce emissions and improve air quality in northern China, but it still requires significant investment from governments, businesses, and households. However, the benefits of coal-to-electricity to improve the rural family environment have received less attention. In this study, we conducted a cost–benefit analysis of the coal-to-electricity transition in Beijing’s Mentougou District from 2013 to 2017, distinguishing private costs and benefits, government costs and public benefits, and social costs and benefits. The results show that for all coal-to-electricity households, the private benefits far outweigh the private costs, with a benefit–cost ratio of 15.9. The government costs outweigh the benefit of air pollutants and carbon dioxide emission reduction, with a benefit–cost ratio of 0.4. Overall, the social benefits outweigh the social costs: the benefit–cost ratio for society was 2.2. The environmental benefits of the coal-to-electricity policies did not offset the large amount of investment of the government, but society received a positive net benefit owing to the large benefits gained by rural households. This also proves that the investment by the government is efficient and verifies the government’s next step to continue to promote the coal-to-electricity transition.

Keywords: coal-to-electricity; clean heating program; costs and benefits; household energy use; government subsidy; choice experiment approach (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2024
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