Has the inter-regional transmission expansion promoted the low-carbon transition of China’s power sector?

Abstract

China is facing unprecedented pressure to reduce carbon emissions than ever before. Significant differences do exist among regions in resource endowment, emission potential and environmental capacity. The introduction of inter-regional transmission lines is of great significance in alleviating environmental pressure and regulating the power mix. However, it is uncertain whether and to what extent the electricity sector has been locked into fossil fuel, as well as the regional differences in low-carbon transition. This study investigates whether the transmission grid expansion represented by more ultra-high voltage (UHV) lines construction will mitigate carbon emissions through a mixed complementarity problems equilibrium analysis. Through simulating the influence of various carbon emission caps on inter-regional transmission lines, it explores the regional differences in low-carbon transition in the power sector, and investigates the regions’ reliance on fossil-fuel from the perspective of carbon lock-in. We propose the following suggestions: (1) Mitigating the reliance on fossil fuel-fired power may relieve the low-carbon transition pressures of the central, eastern, and southern regions; (2) The inter-regional transmission lines help to regulate the distribution of carbon emissions by adjusting emission cost; and (3) The effect of the inter-regional transmission lines on mitigating the carbon lock-in of regional power sector will be weakened when facing a tight carbon emission cap.