Optimization model of low-carbon technology adoption timing for coal power under decarbonization and flexibility demand: Empirical study in Beijing-Tianjin-Hebei region, China

Abstract

Substituting renewable energy for coal power under the carbon neutrality goal is an inevitable path for power system transformation, while the high share of renewable energy leads to a rapid rise in system flexibility demand. Currently, coal-fired power is still one of the most economical and reliable large-scale flexible resources in China. Therefore, the issue of how to mitigate the conflict between cleanliness and flexibility for coal-fired power is urgent to be solved. Accordingly, this paper established an optimization framework for the retirement and technology adoption of coal-fired power units with high spatial-temporal resolution, and the regional carbon emission budget is estimated from a top-down perspective. Secondly, a dynamic carbon quota allocation method considering technological innovation and adoption is proposed. The carbon trading cost of the units is evaluated from a bottom-up perspective, to realize the interaction between the obligatory policy constraints of the top-level target and the flexible incentives of the market mechanism. Finally, the empirical analysis was conducted in the Beijing-Tianjin-Hebei region of China. The optimal solution achieved by proposed method results in a substantial 27% reduction in total costs while keeping the increase in carbon emissions below 3%. By analyzing the dynamic evolution path of coal and the scale of diffusion of multi-type technologies, the differences in the roles coal power assuming at various stages of decarbonization are discussed. The robustness of the model and the validity of the proposed method were verified by comparing the dynamic/static carbon quota allocation. Overall, this study provides an effective optimization model for investigating the low-carbon technology adoption timing for coal power in Beijing-Tianjin-Hebei region, and offers valuable insights for other coal-dominated emerging economies seeking for power system transformation roadmap in the forthcoming net-zero carbon age.