How to Deal with Existing Coal Production Capacity on a Low-Carbon Transition Pathway? A Case Study of China

Abstract

In recent years, driven by climate change and air pollution, the global energy structure is on a low-carbon transition way. Coal production capacity is expected to gradually shrink. Without proper planning, mismatch between capacity shrinking and increasing demand would lead to over-tight energy supplies, on the contrary, it would lead to overcapacity and waste of social resources. A quantitative method considering an overall planning horizon is needed to facilitate policy-making. In this paper, a monthly-scale multi-period and multi-regional modelling and optimization framework of a coal supply system at a transient stage is proposed. China’s coal supply system is taken as a case study. The optimal reduction path of China's coal production capacity and the optimal operation strategy of the coal supply system are obtained by minimising the overall cost by 2050. Results show that the capacity concentration policy would lead to more coal transmission, which results in higher total supply cost.