Clean Generation Technologies in Chinese Power Sector: Penetration Thresholds and Supporting Policies

Abstract

As one of the top energy consumption country, China is under huge pressure of energy security, GHG emission control and environmental protection. Accounting for half of China energy-related emission, Chinese power sector especially need a quick development of clean generation technologies. However, the current developing speed is not enough and the crucial development thresholds of clean generation technologies are poorly understood. For these reasons, this study uses MESEIC (Multi-regional model for Energy Supply system and their Environmental ImpaCts) model to offer a suggested roadmap for Chinese power sector. Through different scenarios, this study sheds light on the penetration thresholds of various clean generation technologies and put forward policy suggestions in different time-scale for breaking out the thresholds. Setting solar power case as an example, the short-term threshold is its generating cost. The suggested solution is enacting promotional policies, such as feed-in tariffs (0.45 RMB/kWh), renewable portfolio standards, renewable energy certificate trading, tax based incentives etc. The long-term threshold is geography limitation, which can be solved by improving the power grid transmission capacity and developing distributed solar energy.