Inter-regional Electricity Research Articles

Ultra-High-Voltage Construction Projects and Total Factor Energy Efficiency: Empirical Evidence on Cross-Regional Power Dispatch in China

Optimizing cross-regional energy dispatch is crucial for addressing regional energy resource imbalances and significantly enhancing energy utilization efficiency. This study aims to analyze the potential impact of China’s ultra-high-voltage (UHV) construction on firms’ total factor energy efficiency and provide empirical evidence supporting the role of cross-regional energy dispatch in improving firms’ energy efficiency. The construction of UHV infrastructure has become a vital part of China’s “New Infrastructure” projects, presenting a “Chinese solution” to the global challenge of regional energy resource mismatches. This study employs an enhanced two-step stochastic frontier method to quantify firms’ total factor energy efficiency and utilizes a difference-in-differences model to evaluate the impact of inter-regional electricity dispatch on this efficiency. The empirical analysis results indicate that UHV construction projects increase the total factor energy efficiency of regional firms by an average of 0.45%, which significantly contributes to firms’ total factor productivity. This conclusion remains valid after a series of robustness tests. Furthermore, the heterogeneity analysis results indicate that the UHV construction project increases the total factor energy efficiency of non-energy-intensive industries by 0.49%, and significantly enhances the total factor energy efficiency of the manufacturing industry by 0.94%. However, it has no significant effect on energy-intensive industries or non-manufacturing enterprises. Additionally, the mechanism analysis shows that UHV construction projects affect total factor energy efficiency through three pathways: industrial structure adjustment, urban innovation, and clean energy transition. This study offers insights for addressing regional energy spatial mismatches and provides policy recommendations for developing a new energy system aligned with regional needs.

Assessing and enhancing the regional sustainability of electricity generation technologies in an energy-importing megaregion in China

Decision-makers are increasingly concerned about the sustainability of power generation technologies to achieve a secure and sustainable electricity supply in the future. This study aims to assess the sustainability of the eight key electricity generation technologies in the energy-importing Yangtze River Delta region of China and further enhance the regional sustainability of the electricity generation mix. We employed the multi-criteria decision-making process to rank the sustainability of the eight electricity generation technologiesfrom the perspective of various decision-makers. First, the results revealed that no technology is absolutely most sustainable. Second, the subjective findings show that hydropower is the most sustainable technology among the assessed ones, followed by nuclear and onshore wind power. Third, policymakers regard fossil fuel energy as more sustainable than investors and experts. Furthermore, local renewable diffusion and substantial electricity imports from renewable-rich areas can enhance the sustainability of the localelectricity system. In addition,an interregional electricity transmission grid with the neighbor Anhui province as the primary backup power supplier can sufficiently enhance the sustainability of the electricity system in the Yangtze River Delta region.

Flexible renewable energy planning based on multi-step forecasting of interregional electricity supply and demand: Graph-enhanced AI approach

Jeju Island faces curtailment problems when renewable energy generation exceeds the facility capacity. In addition, the renewable energy system cannot achieve consistent operation because of the uncertainty of renewable energy sources (RES) and their complex spatiotemporal patterns. Climate change and extreme meteorological phenomena also affect the energy system of the island. Therefore, it is essential to maximize RES exploitation to accomplish carbon-free energy production. This study developed a rolling horizon optimization–based flexible renewable energy distribution planning (FxRE-Plan) based on an artificial intelligence-driven spatiotemporal RES prediction model. An adaptive graph convolutional recurrent network (AGCRN) was used to develop a spatiotemporal prediction model. Then, FxRE-Plan was determined using a multiobjective genetic algorithm to maximize the RES potential under climate change scenarios. The FxRE-Plan was evaluated and compared with the current operation of the electric grid in Jeju Island through economic, environmental cost, and climate change vulnerability assessment index. The results of this research show that the AGCRN–based spatiotemporal prediction model exhibited superior prediction performance, achieving a 95% R2. In addition, the FxRE-Plan reduced greenhouse gas emissions by approximately 11.5% at maximum and climate change vulnerability. Hence, the proposed FxRE-Plan can be used to solve curtailments in real electric grids by pursuing carbon-free islands.

Do electricity flows hamper regional economic–environmental equity?

Inter-regional electricity flows have mitigated the mismatch between electricity generation and demand. However, not only environmental impact transfers but also economic benefits are embodied in electricity flows. Whether electricity flows affect the equity of regional economic-environmental sustainability, the exploration is not sufficient. In this paper, a multi-model framework has developed to trace the transfers of electricity environmental impacts (measured by metal-water-carbon) and economic benefits (measured by valued added) and the degree of equity in the economic–environmental sustainability embodied in electricity flows of China. The results reveal significant asymmetry between where the electricity metal-water-carbon and the electricity value added embodied in electricity flows are transferred. In total, 15.0%, 17.4% and 13.1% of consumption-based electricity metal-water-carbon were outsourced through the electricity flow network, respectively, while only 9.3% of consumption-based electricity value added was outsourced. Wealthier provinces (e.g., Beijing and Guangdong) outsourced a large share of electricity metal-water-carbon to other provinces through the electricity flow network but retained a large share of electricity value added. The REI index between the electricity metal-water-carbon and the electricity value added indicates that money and environmental impacts flowing in the opposite directions have higher inequity. Some provinces, including Shaanxi (the highest REI value at 2.02 was observed for Shaanxi-Gansu), have gained economic benefits from electricity flows, exploiting the advantages of their electricity structures. This study offers insights into helping policymakers better address the potential environmental and economic implications of electricity flows to ensure the sustainable growth of electricity production and consumption.

Economics of planning electricity transmission considering environmental and health externalities

SummaryLong-distance electricity transmission can achieve environmental benefits through the transfer of air pollutants. However, current electricity transmission investment decisions do not take enough environmental factors into account. This study combines Greenhouse Gas–Air Pollution Interactions and Synergies model with power system planning to reveal how regional differences in environmental and health losses affect the allocation of electricity at the spatial level. Based on the analysis of inter-provincial electricity interconnection in China, we find that the regional differences in environmental and health external costs of power generation are significant. Considering external costs in investment decisions will largely improve the economy of long-distance inter-regional electricity transfer dominated by ultra-high voltage lines, thus replacing a portion of intra-regional electricity transfer dominated by high voltage lines. Meanwhile, the increases in local health losses in major electricity exporting provinces are not significant, which can alleviate the regional equity issues caused by pollutant transfer.

The Effects of Climate Change on Interregional Electricity Market Dynamics on the U.S. West Coast

AbstractThe United States (U.S.) West Coast power system is strongly influenced by variability and extremes in air temperatures (which drive electricity demand) and streamflows (which control hydropower availability). As hydroclimate changes across the West Coast, a combination of forces may work in tandem to make its bulk power system more vulnerable to physical reliability issues and market price shocks. In particular, a warmer climate is expected to increase summer cooling (electricity) demands and shift the average timing of peak streamflow (hydropower production) away from summer to the spring and winter, depriving power systems of hydropower when it is needed the most. Here, we investigate how climate change could alter interregional electricity market dynamics on the West Coast, including the potential for hydroclimatic changes in one region (e.g., Pacific Northwest (PNW)) to “spill over” and cause price and reliability risks in another (e.g., California). We find that the most salient hydroclimatic risks for the PNW power system are changes in streamflow, while risks for the California system are driven primarily by changes in summer air temperatures, especially extreme heat events that increase peak system demand. Altered timing and amounts of hydropower production in the PNW do alter summer power deliveries into California but show relatively modest potential to impact prices and reliability there. Instead, our results suggest future extreme heat in California could exert a stronger influence on prices and reliability in the PNW, especially if California continues to rely on its northern neighbor for imported power to meet higher summer demands.

How the uptake of electric vehicles in China leads to emissions transfer: An Analysis from the perspective of inter-provincial electricity trading

The rapid growth of electric vehicles (EVs) has created an unprecedented demand for electricity, and the generation of the electricity required to meet this demand leads, in turn, to large emissions. Interregional electricity trading is a general way of solving the imbalance between regional electricity generation and consumption, and it has profoundly affected the emission patterns of EVs. This study used a Quasi-Input-Output model to analyze the transferred emissions caused by the electricity consumption of EVs in China, the world's largest EV market, from the perspective of inter-provincial electricity trading. The results showed that the amount of transferred GHG, SO2 and NOx emissions caused by EV promotion in 18 selected provinces in 2017 were 1,979.6 kt, 1093.71 t and 1007.68 t, respectively. The main pathways were emissions transferred from the developed east of China to the less developed midwest. Apart from direct emissions transfers between provinces with electricity trade relationships, EVs can produce indirect emissions transfers due to the connectivity of the national electricity network; this part accounts for less than 10% of the total transferred emissions in most provinces. In addition, transferred emissions are an important component of the total emissions of the EV driving stage. From a whole-country perspective, the results of a cost–benefit analysis showed that interregional electricity trading is conducive to improving the national environmental benefits of EV promotion. This study provides an empirical basis for understanding the embodied emissions due to the uptake of EVs, thereby providing implications for promoting the collaborative development of EVs and facilitating comprehensive management of regional emissions transfers.

A Bi-Level Model for the Bidding Strategy of an Inter-Regional Electricity Trading Aggregator Considering Reliability Requirements and Transmission Losses

In countries with large-scale power systems and nascent electricity markets, the inter-regional electricity trading aggregators (IRETAs) are in charge of participating in inter-regional electricity trading (IRET) on behalf of the generators and loads within the region except for operating the regional power systems (RPSs). As price makers in IRET and system operators of RPSs, IRETAs should make their bidding strategies considering both the RPSs’ reliability requirements and the IRET’s transmission losses to ensure both the safe operation of RPS and the profits in the IRET, which cannot be handled by the current methods. Therefore, this paper investigates an approach to help IRETAs make comprehensive bidding strategies in the IRET. Firstly, a hierarchical framework for an IRETA to participate in IRET is introduced. Then a bi-level model is proposed, in which the optimal operation of RPS and the market-clearing process of IRET are regarded as the upper and lower-level problems. Specifically, the upper-level problem is modeled as a two-stage stochastic optimization problem considering both the fault states and the reliability requirements of RPS. Moreover, the non-negligible losses from the inter-regional electricity transmission are internalized in the lower-level problem to consider their impacts on the IRETA’s bidding strategy-making. The proposed bi-level model is nonlinear and transformed into a linear single-level one through the Karush-Kuhn-Tucker (KKT) conditions and the dual theory. Finally, simulations demonstrate that the bidding strategy formed by the proposed method reduces the number of buses exceeding the limit of reliability requirement by over 50% and cuts down the transmission loss by over 40% compared with the former works.

Greenhouse Gas Emission Transfer of Inter-Provincial Electricity Trade in China.

Inter-regional electricity trade is an important way to mitigate the imbalance between regional electricity generation and consumption. With the increasing amount of inter-regional electricity trade in China, the emission transfer problem is more severe. By using Quasi-Input-Output model, which can consider the ripple effect of electricity trade network, this study analyzed embodied greenhouse gas emissions of electricity trade among 30 provinces in China. Results indicated that, in 2017, the national transfer volumes of CO2, CH4, and N2O embodied in inter-provincial electricity trade were 603.25 Mt, 6803.81 t, and 9899.25 t, respectively. Emissions are mainly transferred from the eastern to the western regions, especially to those with high proportion of electricity generated from fossil fuels. The amount of emission transfer is not consistent with that of purchased electricity, since some regions are rich in clean energy. Although direct emission transfer plays the dominant role for most province, indirect emission transfer should also be noticed. Provinces with larger indirect emission transfer generally purchase electricity from provinces with a lot of electricity inflows. The findings could help policy makers coordinate regional energy utilization strategies and issue more effective emission reduction policies in the electricity industry.

Carbon-subsidized inter-regional electric power system planning under cost-risk tradeoff and uncertainty: A case study of Inner Mongolia, China

Inter-regional electricity transmission inevitably brings about unbalanced carbon emission and air pollution among different regions. It is vital to compensate for the economic and environmental loss of power output region by taking the carbon subsidy strategy into account. In this study, a risk explicit interval multistage stochastic programming model considering inter-regional carbon subsidy is developed to support an optimal energy system planning in Inner Mongolia, China. This model can not only deal with uncertainties embedded in the complex energy system described as interval values and random variables but also reflect dynamic linkage between multiple stages over a time series. It advanced the existing optimization methods by introducing the cost-risk tradeoff information based on the risk preferences of decision-makers. The obtained crisp solutions are more feasible, effective and optimum for the practical policymaking process. Different scenarios associated with carbon subsidy policy implementation, renewable energy share adjustment and carbon emission reduction strategy are employed to project the optimal power generation scheme, net system cost, installed electricity capacity, carbon intensity and pollution emission in the future. The results indicate that the amount of exported electricity will keep increasing, and the carbon subsidy strategy will prominently promote the economic growth of the electric power sector by 3.05%. The further power supply pattern is going to transform from fossil fuel to renewable energy, by which wind and solar power will occupy around 44% of total power generation capacity in West Inner Mongolia. Raising the share of renewable energy will be the most effective approach to adjust the power generation scheme; meanwhile, reducing carbon intensity will significantly contribute to enlarge green energy capacity, enhance low-carbon emission and mitigate air pollution. These findings will help decision-makers gain insights into a more scientific energy system planning under various uncertainties.

How to promote energy transition in China: From the perspectives of interregional relocation and environmental regulation

Abstract This study investigates the impacts of interregional clean energy relocation and environmental regulation on energy transition with panel data of 30 provinces in China from 1997 to 2015. Instead of applying the production data of clean energy directly as prior studies did, we calculate the actual consumption of clean energy in each region to get more accurate and reliable conclusion. Applying linear, and further, non-linear panel data models, we derive the following conclusions: (1) Interregional electricity relocation (IRET) projects transmit electricity from sending areas to landing areas and have different impacts on energy transition in different areas. Specifically, in landing areas, IRET promotes energy transition but not as significantly as expected, which implies landing areas should try to be more self-sufficient in clean energy instead of relying on interregional relocation completely. In sending areas, IRET has a negative effect on energy transition. Furthermore, IRET impedes energy transition when energy intensity is higher than the threshold value. This suggests that energy efficiency improvement should be paid particular attention, especially in sending regions. (2) Energy-specific environmental regulation has a significant positive impact on energy transition in China. Meanwhile, environmental regulation's impact on energy transition is weakened by high energy intensity.

Economic viability and regulation effects of infrastructure investments for inter-regional electricity transmission and trade in China

The transition of energy structure to renewable energy is a social and systematic engineering that requires complex regional power interconnection as a support. Thus, an assessment of the economic viability of infrastructure investments for supporting such transmission expansion is crucial. This study presents a multi-regional power system optimization model to evaluate the potential economic benefits of infrastructure investments for the national inter-regional electricity network in China under various scenarios in the context of low-carbon transformation. Key factors influencing economic benefits are analyzed specifically and regulation barriers associated with inter-regional electricity trade are given particular attention. The results show that approximately 140 Giga Watt (GW) of infrastructure construction for the inter-regional electricity trade network is economically viable during the planning horizon. These new interconnections would lead to 250–440 billion RMB of economic benefits. Regional electricity trade barriers caused by imperfect market mechanisms have a negative impact on the economic benefits of transmission infrastructure investments, although they promote scale and utilization efficiency in the power sector of electricity-importing regions. Improving the national grid coordination mechanism to break the grid isolation between the State Grid Corporation of China and the China Southern Power Grid is crucial, because a large number of transmission lines connecting these two national-level power grids are economically viable.

The economic geography of variable renewable energy and impacts of trade formulations for renewable mandates

This paper examines electricity market responses to flexibility provisions in prospective renewable energy mandates and the geographical incidence of impacts. Using an integrated model of electric sector investments and operations with detailed spatial and temporal resolutions, the analysis demonstrates how renewable mandate trade formulations for electricity and renewable energy certificates can materially impact power sector outcomes like capacity planning decisions, compliance costs, CO2 emissions, and the regional distribution of renewable development. There are substantial welfare gains, up to $84 billion in present value terms through 2050, from inter-regional electricity and permit trade (and costs of market fragmentation), but the degree and direction of impact depend on region-specific considerations. Allowing permit trade encourages greater deployment of wind and solar in regions with favorable investment environments and resources, but renewable capacity additions are appreciable in all regions since diminishing marginal returns and transmission constraints limit the benefits of overdevelopment in any single region. Model results suggest that regions will likely find it beneficial to generate at least half of their renewable mandate compliance obligations through in-state resources and that most of the economic benefits from inter-regional REC exchange can be captured with a relatively modest amount of trading flexibility. Trade flexibility is shown to have minimal impacts on CO2 emissions leakage nationally.

Water scarcity risks mitigated or aggravated by the inter-regional electricity transmission across China

Traditionally, around 34–38% of China’s population resides in places experiencing high water scarcity for at least one month a year. However, the risk of water scarcity may be further exacerbated by inter-regional electricity transmission, due to the mismatch between the electricity-receiving population living in water-abundant areas and the water scarcity experienced in the electricity-exporting region. Using detailed thermal/hydro- power plants data and water scarcity index at the water basin scale, this study systematically quantified this additional water scarcity risk across China. The affected population, i.e. those living in basins under lower water scarcity but needing electricity generated in basins with higher water scarcity, was estimated to be 134 million, or 10% of the total population in China. Among this, over 60 million people were considered as highly-affected population (i.e. people who live in no/low stress basins rely on electricity generated in severe/extreme scarcity basins), the majority of whom lived in Southern China. This leads to a 12% increase in water-stressed population if the proposed transmission projects were implemented. On the other hand, more people, i.e., 285 million, would benefit from the inter-regional electricity transmissions. They relied on the electricity generated from basins under lower water scarcity. It is found that intra-grid’s thermal electricity transmission was less effective in mitigating the water scarcity than the hydroelectricity. It determined that the southern part of China faced worse environmental performance in coordinating its water endowment with the electricity generation because of its use of electricity from water stressed basins rather than from the water sufficient basins.

Determinants of Greenhouse Gas Emissions from Interconnected Grids in China.

While direct greenhouse gas (GHG) emissions by China's power sector from the generation side have been widely investigated, driving forces from the electricity consumption perspective and inter-regional electricity transmission have been overlooked to a large extent. This study quantified relative contributions of six factors to changes in GHG emissions from interconnected grids in China during 2008-2015. These six factors include three generation-side factors (i.e., fuel mix of thermal power generation, energy efficiency of thermal power generation, and electricity structure), two consumption-side factors (i.e., electricity efficiency of GDP and GDP), and electricity transmission structure. GDP growth and changes in fuel mix of thermal power generation are two major drivers of increased GHG emission during 2008-2015, especially for the North China Grid. In contrast, changes in electricity transmission structure (especially in East China Grid and Southern China Grid), the increase in electricity efficiency of GDP (except for Northwest China Grid), improvements in energy efficiency of thermal power generation (especially in North China Grid and Central China Grid), and changes in electricity structure (especially in Southern Power Grid) are major factors offsetting GHG emission increments. Findings of this study can provide multiple-perspective policy implications for GHG mitigation in China's power sector.

Cooperative game of electricity retailers in China's spot electricity market

Chinese electricity market has undergone twice reforms since 2002. However, the current electricity market is still partially irrational in electricity pricing mechanism. Furthermore, the utilization of renewable energy is inefficient in western regions. From the perspective of market participants, electricity retailers are new entrants in deregulated electricity market. In this spot electricity market, they are faced with various challenges and opportunities. Thus, this paper introduces an inter-regional power transaction model based on bottom-up modeling. There are mainly three parts in this paper: ⑴ It examines the existing problems and achievements in the twice reforms, and introduces the participants of cooperative game in a spot market. ⑵It proposes an inter-regional electricity transaction model to illustrate the new pricing mechanism. ⑶ Based on cooperative game theory, it quantifies how costs, electricity prices and benefits affect the behavior of retailers in a spot market with some reasonable economic assumptions. What is novel about this research is that the proposed transaction model analyzes electricity retailers' behaviors in a spot market. The cooperative game model improves electricity retailer's competitiveness in a spot market, and is of great theoretical and practical significance for the reform and development of China's electricity market.

Environmental impact of electricity relocation: A quasi-natural experiment from interregional electricity transmission

Pollutants such as sulfur would concentrate in the source regions and thus the localized impacts are more obvious. Local balance of electricity by transporting coal has resulted in dense concentration of coal-fired power plants in load centers and caused severe environmental problems. Electricity relocation through interregional transmission is another choice for energy transportation to achieve electricity balance across regions and pollution mitigation. Using interregional electricity transmission (IRET) lines in China as a quasi-natural experiment, this paper assesses the environmental impact of electricity relocation. In the assessment, the grid organization of “province as executor” in China is considered because it affects the sphere of IRET's influence on pollution mitigation. Here we show the environmental benefits of electricity relocation. We find that, electricity relocation through interregional transmission leads to the growth rate of sulfur dioxide (SO2) emission decreasing 7% in landing areas and Sichuan province benefits most from electricity relocation. It is interesting that there is no significant increase of SO2 emission growth rate in sending areas compared to counterfactuals if there had no IRET due to more integration of clean energy and improved emission efficiency in sending areas. Placebo study and robustness check show that the results are quite convincing. Therefore, IRET provides an appealing choice for China's environmental control in eastern region, and it is not necessarily at the cost of pollution in western region. The methodology can be applied to assess the environmental impacts of other program or policy elsewhere.

A multi-region load dispatch model for the long-term optimum planning of China’s electricity sector

Future development of China’s electricity system will not only need to consider generation capacity needed to meet demand but also economic and flexible technologies to meet peak demand and integrate increasing volumes of intermittent renewable generation. This paper describes research in which a multi-region dispatch model was established and analysis performed to gain insights into optimal choices for the development of China’s electricity sector. The model reflected China’s regional electricity demand profiles, its natural resource distribution, its inter-regional electricity transmission network, performance characteristics of different electricity generating technologies, and temporal electricity demand variations. The case study included a cap-and-trade carbon mitigation scheme to enable direct comparison with previous studies that lacked the temporal element considerations. The results highlighted the importance of considering even short-term temporal variations when planning the long-term development of electricity systems. They also demonstrated how Natural Gas Combined Cycle turbines (NGCC) are well suited to providing peak-demand regulation capability. Whilst, the analysis indicates that coal-fired plants are set to continue to play a significant role through out to 2050. The modelling also confirms the deployment of renewable energy in the long-term future and as a result the requirement of flexible generation to maintain stability and integrity.

Operational performance management of the power industry: a distinguishing analysis between effectiveness and efficiency

The trend toward a more competitive electricity market has led to efforts by the electric power industry to develop advanced efficiency evaluation models that adapt to market behavior operations management. The promotion of the operational performance management of the electric power industry plays an important role in China’s efforts toward energy conservation, emission control and sustainable development. Traditional efficiency measures are not able to distinguish sales effects from productive efficiency and thus are not sufficient for measuring the operational performance of an electricity generation system for achieving its specific market behavior operations management goals, such as promoting electricity sales. Effectiveness measures are associated with the capacity of an electricity generation system to adjust its input resources that influence its electricity generation and, thus, the capacity to match the electricity demand. Therefore, the effectiveness measures complement the efficiency measures by capturing the sales effect in the operational performance evaluation. This study applies a newly developed data envelopment analysis-based effectiveness measurement to evaluate the operational performance of the electric power industry in China’s 30 provincial regions during the 2006–2010 periods. Both the efficiency and effectiveness of the electricity generation system in each region are measured, and the associated electricity sales effects and electricity reallocation effects are captured. Based on the results of the effectiveness measures, the alternative operational performance improvement strategies and potentials in terms of input resources savings and electricity generation adjustments are proposed. The empirical results indicate that the current interregional electricity transmission and reallocation efforts are effective in China overall, and a moderate increase in electricity generation with a view to improving the effect on sales is more crucial for improving effectiveness.

Distinguishing Operational Performance in Power Production: A New Measure of Effectiveness by DEA

Measuring the efficiency of power plant systems requires capturing fluctuations in the level of sales to customers as well as accounting for the effects of regulatory caps on emissions. This study proposes a novel effectiveness measure considering desirable outputs and undesirable outputs via data envelopment analysis (DEA). The new measure complements typical efficiency measures. We test the validity of the proposed measure with an empirical case study of the fifty U.S. states and the District of Columbia. We find that the current interregional electricity transmission plan increases 8.56% in effectiveness. For the emissions control, we suggest a 9.8% reduction in electricity generation towards an effective production frontier. We conclude that the proposed effectiveness measure's ability to distinguish sales and regulation effects from typical productive efficiency eliminates the bias often found in currently used measures.