Carbon Reduction Cost Research Articles

Regional Operation of Electricity-Hythane Integrated Energy System Considering Coupled Energy and Carbon Trading

The deepening implementation of the energy and carbon market imposes trading requirements on multiple regional integrated energy system participants, including power generation plants, industrial users, and carbon capture, utilization, and storage (CCUS) facilities. Their diverse roles in different markets strengthen the interconnections among these subsystems. On the other hand, the operation of CCUS, containing carbon capture (CS), power-to-hydrogen (P2H), and power-to-gas (P2G), results in the coupling of regional carbon reduction costs with the operation of electricity and hythane networks. In this paper, we propose a regional economic dispatching model of an integrated energy system. The markets are organized in a centralized form, and their clearing conditions are considered. CCUS is designed to inject hydrogen or natural gas into hythane networks, operating more flexibly. A generalized Nash game is applied to analyze the multiple trading equilibria of different entities. Simulations are carried out to derive a different market equilibrium regarding network scales, seasonal load shifts, and the ownership of CCUS. Simulation results in a 39-bus/20-node coupled network indicate that the regional average carbon prices fluctuate from ¥1078.82 to ¥1519.03, and the organization of independent CCUS is more preferred under the proposed market structure.

Potentials of greenhouse gas emission reduction through energy efficiency improvement in Iran's petrochemical sector

Reducing energy consumption and increasing energy efficiency is a key strategy to mitigate greenhouse gases (GHGs) in the petrochemical sector, both because of the high share of energy-related emissions and because of the economic attractiveness in terms of return on investment. This paper aims to calculate the GHG mitigation potentials of the energy reduction projects in Iran's petrochemical sector. firstly, we estimated the trend of GHG emissions until 2035 using data collected from the petrochemical complexes in Iran. Then, by assessing the energy audits and other studies, we calculated the energy consumption reduction potentials as well as their costs and benefits for petrochemical complexes. Finally, we modelled the energy supply and demand of the petrochemical sector in LEAP software to evaluate the mitigation potentials of the energy reduction projects. The results show that a 6.7 % emission reduction in the existing petrochemical complexes can be achieved with a capital of about 160 million dollars. The net present value of the projects will be about 2 billion dollars, and the cost of carbon reduction will be −60.7 dollars per ton. The results of this research can be used for policymakers to plan the mitigation pathway of the sector since the revenues obtained from the energy conservation measures can be used to fund capital-intensive GHG mitigation projects.

How does carbon emissions trading scheme affect the investment efficiency of companies? Evidence from China

Carbon emissions trading scheme (ETS) will change the internal and external operating environment of related companies, increase new carbon reduction costs, and may affect their investment behavior and decision-making. This study constructs the policy effect evaluation model to evaluate the net effect of China's ETS pilot policy on the investment efficiency of related companies in high-carbon industries. This study indicates that: first, China's ETS pilot policy has reduced the inefficient investment of related companies by 11.40% during the sample period. Second, innovation ability plays an enhanced moderating effect in the inhibitory effect of China's ETS pilot policy on the inefficient investment of related companies in the short term, but the effect is weakened in the long-term. Third, the policy effect is relatively obvious for non-state-owned companies and companies with more institutional shareholdings. This research has important reference value for the continuous improvement of China's national carbon market, and the steady transformation from simple investment-driven to investment-efficiency-driven economic development in China.

Allocation of CO2 emission quotas for industrial production in Industry 4.0: Efficiency and equity

The method of carbon emission quota (CEQ) allocation based on data envelopment analysis (DEA) can allocate quotas without impacting efficiency improvements in industrial sector. A key element in effectively reducing carbon emissions is ensuring accurate efficiency measurement and equitable allocation of CEQ in the Industry 4.0 era. This paper divides industrial system into two stages: production (which more accurately reflects carbon emissions in production) and trading (which involves in the commercial system). Carbon emission efficiency in the production stage is calculated with a DEA model, with a high degree of accuracy. Given that higher efficiency values correspond with stronger capacity to bear the costs of carbon reduction, a CEQ allocation model is proposed which considers the contribution degree of efficiency. This model is applied to China’s industrial production system. The results show that a CEQ allocation scheme that focuses only on the production stage is more equitable than schemes which treat the industrial system as a black box. In allocation schemes which focus only on the production stage, the central region of China is least able to bear the cost of carbon reduction and receives the most CEQ, and the opposite is true in the eastern region of China. The proposed method not only measures the carbon emission efficiency of industrial production more accurately, but also considers the balanced development of different regions when allocating carbon emission rights. The CEQ allocation scheme based on our model can confidently meet the needs of sustainable development in the era of Industry 4.0.

Propulsion Electrification Architecture Selection Process and Cost of Carbon Abatement Analysis for Heavy-Duty Off-Road Material Handler

<div>The heavy-duty off-road industry continues to expand efforts to reduce fuel consumption and CO<sub>2</sub>e (carbon dioxide equivalent) emissions. Many manufacturers are pursuing electrification to decrease fuel consumption and emissions. Future policies will likely require electrification for CO<sub>2</sub>e savings, as seen in light-duty on-road vehicles. Electrified architectures vary widely in the heavy-duty off-road space, with parallel hybrids in some applications and series hybrids in others. The diverse applications for different types of equipment mean different electrified configurations are required. Companies must also determine the value in pursuing electrified architectures; this work analyzes a range of electrified architectures, from micro hybrids to parallel hybrids to series hybrids to a BEV, looking at the total cost, total CO<sub>2</sub>e, and cost per CO<sub>2</sub>e (cost of carbon abatement, or cost of carbon reduction) using data for the year 2021. This study is focused on a heavy-duty off-road material handler, the Pettibone Cary-Lift 204i. This machine’s specialty application, including events like unloading large oil pipes from a railcar, requires a unique electrified architecture that suits its specific needs. However, the results from this study may be extrapolated to similar machinery to inform fuel savings options across the heavy-duty off-road industry. In this study, a unique electrified architecture is determined for the Cary-Lift. This architecture is informed by multiple rounds of a Pugh matrix decision analysis to select a shortened list of desirable electrified architectures. The shortened list is modeled and simulated to determine CO<sub>2</sub>e, cost, and cost per CO<sub>2</sub>e. A final architecture is determined as a plug-in series hybrid that reduces fuel consumption by 65%, targeting the large fuel and CO<sub>2</sub>e savings that are likely to be required for the future of the heavy-duty off-road industry.</div>

Promoting Decarbonization in China: Revealing the Impact of Various Energy Policies on the Power Sector Based on a Coupled Model

The carbon emissions of the power industry account for over 50% of China’s total carbon emissions, so achieving carbon peak and carbon neutrality in the power sector is crucial. This study aims to simulate the impacts of three energy policies—carbon constraints, the development of a high proportion of renewable energy, and carbon trading—on China’s energy transition, economic development, and the power sector’s energy mix. Through the construction of a dynamic computable general equilibrium (CGE) model for China and its integration with the SWITCH-China electricity model, the impact of diverse energy policies on China’s energy transition, economic progress, and the power mix within the electricity industry has been simulated. The integration of the SWITCH-China model can address the limitations of the CGE model in providing a detailed understanding of the specific intricacies of the electricity sector. The results indicate that increasing the stringency of carbon restrictions compels a reduction in fossil energy use, controlling the output of coal-fired power units, and thereby reducing carbon emissions. The development of a high proportion of renewable energy enhances the cleanliness of the power sector’s generation structure, further promoting the national energy transition. Implementing a carbon trading policy, where the entire industry shares the burden of carbon reduction costs, can effectively mitigate the economic losses of the power sector. Finally, the policies to further enhance the implementation of carbon trading policies, strengthen effective governmental regulation, and escalate the deployment of renewable energy sources are recommended.

Comprehensive analysis of carbon emission reduction technologies (CRTs) in China's coal-fired power sector: A bottom-up approach

Carbon dioxide (CO2) reduction technologies (CRTs) in the coal-fired power sector play an imperative role in the mitigation of environmental challenges and reducing CO2 emissions to help achieve the 2 °C target. However, a compelling necessity persists for a unified framework that can effectively and accurately estimate the costs and potentials associated with CRTs, arising from the diversity of technologies and unit types. Therefore, this study employs a bottom-up approach to analyze the costs and potential of 25 advanced CRTs in the coal-fired power sector, excluding CO2 capture, utilization and storage (CCUS), across 19 types of coal-fired power units. This analysis amalgamates the CO2 reduction supply curve (CRSC) approach with levelized cost of CO2 reduction (LCOC) and a broken-even analysis which could reflect the sector's average carbon reduction cost. The outcomes reveal the following key insights: (1) These technologies collectively harbor a substantial CO2 conservation potential amounting to 925.61 Mt CO2, with a broken-even price of CNY 410.1/tCO2. This reduction could potentially lower 20%–25 % of CO2 emissions in China's power system in 2022, highlighting the crucial role of CRTs in achieving a low-carbon transition and national climate targets; (2)Steam turbine flow path retrofit (T8) not only offers a relatively high CO2 reduction potential (>60 Mt CO2), but also features a low cost (<CNY 150/tCO2) and high profit (>CNY 0.85/MWh). Prioritizing the development of this technology can significantly accelerate the low-carbon transition of coal power; (3) Carbon price have a paramount influence on the cost-effectiveness of CRTs and driving their adoption.

Greenhouse Gas Reduction Potential and Economics of Green Hydrogen via Water Electrolysis: A Systematic Review of Value-Chain-Wide Decarbonization

Green hydrogen generated via water electrolysis has become an essential energy carrier for achieving carbon neutrality globally because of its versatility in renewable energy consumption and decarbonization applications in hard-to-abate sectors; however, there is a lack of systematic analyses of its abatement potential and economics as an alternative to traditional technological decarbonization pathways. Based on bibliometric analysis and systematic evaluation methods, this study characterizes and analyzes the literature on the Web of Science from 1996 to 2023, identifying research hotspots, methodological models, and research trends in green hydrogen for mitigating climate change across total value chain systems. Our review shows that this research theme has entered a rapid development phase since 2016, with developed countries possessing more scientific results and closer partnerships. Difficult-to-abate sectoral applications and cleaner production are the most famous value chain links, and research hotspots focus on three major influencing factors: the environment; techno-economics; and energy. Green hydrogen applications, which include carbon avoidance and embedding to realize carbon recycling, have considerable carbon reduction potential; however, uncertainty limits the influence of carbon reduction cost assessment indicators based on financial analysis methods for policy guidance. The abatement costs in the decarbonization sector vary widely across value chains, electricity sources, baseline scenarios, technology mixes, and time scenarios. This review shows that thematic research trends are focused on improving and optimizing solutions to uncertainties, as well as studying multisectoral synergies and the application of abatement assessment metrics.

Co-benefits and influencing factors exploration of air pollution and carbon reduction in China: Based on marginal abatement costs

This study addresses the pressing need for cost-effective emission reduction strategies that maximize co-benefits in terms of air pollution and carbon emissions. Our research contributes to the literature by accurately measuring these co-benefits, thereby facilitating their prompt realization in different regions. We employ an input-output framework that integrates carbon emissions and air pollution, allowing us to calculate marginal abatement costs using the shadow price of undesired output. Through this approach, we quantify the co-benefits and analyze the factors influencing them at both spatiotemporal and factor levels using spatial kernel density and geographical detectors. Our findings reveal several key insights: (1) under joint emission reduction efforts, we observe average annual reduction rates of 6.46% for marginal pollution and 6.10% for carbon reduction costs. Importantly, we document an increase in co-benefits from 0.50 to 0.86, characterized by an initial fluctuation followed by a linear increase. (2) the marginal cost difference for carbon emission and pollution reduction in western China was 179.45 and 155.08 respectively, compared to 321.51 and 124.70 in the Northeast, highlighting the crucial role of regional differences in shaping co-benefit outcomes. (3) we identify a negative spatial spillover effect between provinces, which diminishes over time, leading to heterogeneous effects when local provincial co-benefits exceed a threshold of 0.9. (4) during the adjustment period, we find that the industrial structure exerts significant single and interactive effects on co-benefits. Additionally, we highlight the critical role of environmental governance investment and government intervention as drivers of co-benefits in the current era. By offering the quantification of co-benefits under the marginal abatement costs, our study provides valuable scientific insights for planning and implementing effective synergy strategies.

Research on Cost Sharing and Coordination of Low Carbon Supply Chain in the Context of Carbon Neutrality Strategy

For carbon emissions under the limit of supply chain cost sharing problem, based on the Shared contract perspective starkerberg game model includes the manufacturers and retailers, analyzes the cost sharing ratio, carbon trading price and unit carbon tax emissions on the supply chain, and the optimal strategy combination and carbon reduction cost allocation ratio is studied. The results show that the one-way cost sharing model is beneficial to the reduction of low carbon supply chain, while the two-way cost sharing model has a positive effect on the reduction of supply chain within the small allocation ratio. In addition, the sharing proportion of manufacturers is within a certain range, and the two-way emission reduction mode is the optimal choice for the supply chain. Meanwhile, the sharing proportion will affect the choice between decentralized and centralized decisions. In addition, the numerical analysis shows that the carbon emission reduction levels increase with the increase of carbon trading prices. The results have good reference significance for the carbon emission reduction decision and carbon reduction cost sharing contract among members of the low-carbon supply chain.

How Would Structural Change in Electricity and Hydrogen End Use Impact Low-Carbon Transition of an Energy System? A Case Study of China

Driven by global targets to reduce greenhouse gas emissions, energy systems are expected to undergo fundamental changes. In light of carbon neutrality policies, China is expected to significantly increase the proportion of hydrogen and electricity in its energy system in the future. Nevertheless, the future trajectory remains shrouded in uncertainty. To explore the potential ramifications of varying growth scenarios pertaining to hydrogen and electricity on the energy landscape, this study employs a meticulously designed bottom-up model. Through comprehensive scenario calculations, the research aims to unravel the implications of such expansions and provide a nuanced analysis of their effects on the energy system. Results show that with an increase in electrification rates, cumulative carbon dioxide emissions over a certain planning horizon could be reduced, at the price of increased unit reduction costs. By increasing the share of end-use electricity and hydrogen from 71% to 80% in 2060, the unit carbon reduction cost will rise by 17%. Increasing shares of hydrogen could shorten the carbon emission peak time by approximately five years, but it also brings an increase in peak shaving demand.

Cogeneration transition for energy system decarbonization: From basic to flexible and complementary multi-energy sources

Energy system transition towards carbon neutrality often involves ambitious substitution of renewable sources for fossil fuels and investment in energy storage to provide regulative flexibility. Yet, radical development of renewable sources may lead to serious asset stranding of existing fossil fuel power, thereby increasing the carbon reduction costs. In this study, new carbon neutralization opportunities are explored in the context of integrated heat and power systems in high latitudes through complementarity of cogeneration retrofit and energy converters. Cogeneration retrofit is an economical option to address the carbon abatement straits as a forerunner and can postpone the construction of flexible energy converters and energy storage for about 10 years. This alleviates potential asset stranding of fossil fuel power, reducing the overall cost by about $ 1.53 billion in Liaoning Province, China. As carbon neutralization progresses, the cogeneration acts as an indispensable backup resource to ease the weather-extreme-induced power shortage.

Techno-economic feasibility and performance analysis of an islanded hybrid renewable energy system with hydrogen storage in Morocco

This study focuses on the conceptual design and viability assessment of a hybrid microgrid system for a settlement in Dakhla city. The system consists of a 600 kW wind turbine, 300 kW diesel generators for backup, a 300 kW fuel cell, and a 500 kW electrolyzer. A simulation model using TRNSYS software was developed to analyze the energy exchange and ensure system reliability. The study incorporates a power dispatch management strategy (PDMS) with load following mode (LFM) and cycle charging mode (CCM) approaches, aiming to enhance the understanding and management of stand-alone renewable energy systems with electrochemical storage. A techno-economic investigation is conducted for a settlement load profile using the hybrid wind/Fuel/DEGS configuration to evaluate its feasibility. The performance study reveals that the hybrid system achieves a significant renewable fraction of 44.57 %. From an economic perspective, the proposed hybrid system proves to be financially viable. The analysis shows an NPVCost of $2,650,843 and NPVProduction of 37,819,172 kWh, resulting in a levelized energy cost of $0.0701/kWh. Additionally, the system demonstrates the potential to reduce CO2 emissions by 70,529.80 tons over its 20-year lifespan, with a carbon reduction cost of approximately $37.5847 per t/CO2e. These findings highlight the substantial cost savings of approximately $2,656,754.51, equivalent to the creation of 5256.16 acres or 2125.7 ha of new green space and plants. The combination of economic viability and environmental benefits positions the proposed hybrid energy system as a promising alternative for meeting long-term energy needs while mitigating environmental impact. The study underscores the potential of the system to provide cost-effective electricity to remote communities, thereby contributing to addressing the energy crisis and fostering a sustainable future. The proposed hybrid energy system has significant potential to provide electricity to remote communities at low production costs, as well as to contribute to preventing, controlling, and overcoming the energy crisis for a sustainable future.

Optimal sizing and feasibility analysis of second-life battery energy storage systems for community microgrids considering carbon reduction

The rapid development of distributed renewable energy has made energy storage essential for efficient operation. However, energy storage is challenging for prosumers due to high investment costs and long payback periods. The second use of batteries has been evaluated as an alternative energy storage after the first service in electric vehicles with the remaining 80% capacity. This study investigates the feasibility of using secondary-use batteries as shared storage for prosumers. Financial and technical break-even points regarding the gradually increasing carbon limit on the way to 100% renewable have been determined. The proposed method's performance has been verified by conducting sensitivity analyses regarding various environmental and economic characteristics. The self-consumption rates have been achieved by 65.9% in Spain (Madrid) and 49.9% in England (London), and 48.5% in Türkiye (Antalya) without incentive. Increasing the carbon tax by 1 $/t for high and low energy tariffs can reduce carbon emissions by 181.3 and 1607 kg/yr. The optimum sizes remain until the carbon tax threshold is 60 $/tCO2eq for high energy tariffs. After 60 $/tCO2eq, it is tended to enlarge the hybrid power system. However, severe carbon emission restriction for zero carbon targets prevents the optimum system design since the carbon reduction cost increases to 232.7–304.8 $/kg. This study encourages investors and prosumers to plan the shared energy storage system sensibly and guides governments to develop realistic incentive mechanisms to implement second-life batteries effectively.

Grandfathering or benchmarking? The performance of implementing blockchain technology in a low-carbon supply chain

Blockchain can make the production process transparent and increase consumer recognition. With regard to the grandfathering and benchmarking, which are two widely implemented carbon regulation schemes in the industrial field, how will the use of blockchain perform asymmetric cost effects and emission reduction driving effects on these two carbon policies? From the perspective of carbon reduction and supply chain stakeholders, which regulation scheme should be adopted is an important issue that deserves attention. By analyzing the performances of two carbon allocation mechanisms with and without blockchain, we have the following findings: The implementation of benchmarking mechanism can better stimulate the manufacturer's enthusiasm for emission reduction, and the retailer also prefers benchmarking, regardless of whether the blockchain employed or not; There exists a situation where a higher unit blockchain cost leads to a lower total carbon emission, and unit improvement in environmental performance may not necessarily improve overall environmental performance; We define the Pareto regions in which the interests of supply chain stakeholders and the environmental performance of the supply chain can be improved simultaneously by adopting blockchain. We also investigate the impacts of consumer sensitivity to blockchain technology, carbon reduction cost and carbon trading price on the Pareto regions.

Optimal brand differentiation and private brand introduction strategies considering carbon emission reduction

AbstractThis paper constructs a theoretical model to explore whether manufacturers should launch low‐end products and whether retailers should introduce private brands. The main results show that whether retailers (manufacturers) introduce private brands or launch low‐end products depends not only on the fixed cost of introducing private brands (launching low‐end products) but also on the sensitivity of consumers to carbon reduction, product competition coefficient, manufacturer's cost of high‐end products, and carbon reduction cost coefficient. Furthermore, brand differentiation strategy and private brand introduction strategy have an impact on one another.

Cooperative operation strategy of electric vehicle and photovoltaic power station considering carbon reduction benefit under dynamic electricity price.

In the context of the global green and low-carbon transformation, microgrids containing renewable energy have been widely developed. At present, renewable energy generation has the disadvantages of instability and low energy density. In addition, the high proportion of electric vehicles (EVs) connected to the state grid will cause different degrees of disturbance to its safe operation. Therefore, a coordinated operation strategy of EV and photovoltaic (PV)-energy-storage charging stations induced by dynamic electricity price considering carbon reduction benefit is proposed. On the power generation side, a dual-axis PV tracking control method with "fixed frequency + variable frequency" control is proposed. One day is used as a period to divide the time segments, and the same time segment uses the fixed frequency tracking method, while different time segments use the variable frequency tracking method to improve the power generation efficiency. On the electricity consumption side, a dynamic electricity price strategy is adopted, using the minimum carbon reduction cost as the reward function, optimizing the dynamic electricity price under the minimum carbon reduction cost using the deep deterministic policy gradient (DDPG) algorithm to promote the shifting of EV charging load to the effective hours of PV generation. In conclusion, the simulation analysis is carried out in Zibo City, and the generation capacity of the proposed tracking method on the power generation side is improved by about 32% compared with the fixed PV generation capacity. Compared with the time-of-use electricity price, the optimized dynamic electricity price under the minimum carbon reduction cost can better promote the load transfer and photoelectric consumption of EVs and reduce the carbon reduction cost.

Achieving urban net-zero targets through regionalized electric bus penetration and energy transition

The electrification of public transit is one of the key actions in the transportation sector. This study proposed an innovative framework for analyzing the effectiveness and emission reduction potential of electrifying transit policies. The future energy consumption, GHG emissions, and pollutant emissions of bus fleets in representative Canadian cities were analyzed. Under the high oil price scenarios, this study incorporated the upfront infrastructure costs, the social costs of pollution, and the dynamics of carbon prices and fuel prices, allowing for a comprehensive analysis of carbon reduction costs during transition. Compared to the BAU scenarios, the cumulative GHG emissions from 2019 to 2030 of bus fleet in ESD scenarios in Toronto, Montreal, Edmonton, and Halifax had a reduction of 18.7 %, 30.1 %, 21.3 % and 34.6 %, respectively. The findings have implications for the trade-off management of climate policies at the provincial level and can help understand polycentric governance from multiple resource perspectives.

Role of carbon emission linked financial leasing in shipping decarbonization

ABSTRACT Carbon emission-linked financial leasing (CFL) is a type of financial service that encourages commitment by borrowers to pursue decarbonization for greener operations. The main difference between CFL and traditional financial leasing (TFL) is that the financial lease hire is dynamically linked to the actual carbon emissions. This study investigates a green shipping operations system comprising a capital-constrained shipping firm providing green shipping services to shippers and a financial leasing firm providing the financial leasing business of green ships. By imposing a hard constraint on carbon emissions, we construct game theory models for CFL and TFL. The optimal equilibrium solutions in CFL and TFL are obtained, as well as comparisons of the profits and price of shipping services in different financial leasing models. Results corroborate that CFL is more effective for decarbonization. The participants need to sacrifice their profits, even if carbon reduction cost can be shifted to shippers through the price of shipping services. Tighter carbon emissions constraints can reinforce the effects of shipping decarbonization. Furthermore, we extend our study to cap-and-trade scheme for application. Most of the results derived in the models with a hard constraint on carbon emissions are applicable in the situation with cap-and-trade scheme

Carbon emission allowance allocation based on a bi-level multi-objective model in maritime shipping

To mitigate carbon emissions from maritime shipping, this study investigates the strategies and performance of allocating carbon emission allowances (CEAs) with the cap-and-trade mechanism among shipping companies. Using a bi-level model solved by the multi-objective particle swarm optimization algorithm based on Pareto solution set, the interactions between decisions of the government and shipping companies are well characterized. The results of the benchmark scenario indicate that all shipping companies’ optimal carbon emissions decrease annually during the planning period, and a larger company usually exhibits a better emission reduction performance. However, economic benefits of shipping companies and the society display an annually declining trend due to additional carbon emission reduction costs. The sensitivity analysis demonstrates that the decreasing carbon prices lead to more emissions, while the optimal total carbon emissions decrease as carbon reduction costs increase. These findings create implications for multiple stakeholders to formulate their own carbon emissions mitigation strategies under the cap-and-trade mechanism.