scholarly journals Financing the Transition Toward Carbon Neutrality—an Agent-Based Approach to Modeling Investment Decisions in the Electricity System

2021 ◽  
Vol 3 ◽  
Author(s):  
Jinxi Yang ◽  
Christian Azar ◽  
Kristian Lindgren
Keyword(s):  
Large Scale ◽  
Carbon Tax ◽  
Energy Transition ◽  
Energy System ◽  
Low Carbon ◽  
Agent Based ◽  
Carbon Neutrality ◽  
Investment Financing ◽  
Electricity System ◽  
Low Carbon Technologies

Transitioning to a low-carbon electricity system requires investments on a very large scale. These investments require access to capital, but that access can be challenging to obtain. Most energy system models do not (explicitly) model investment financing and thereby fail to take this challenge into account. In this study, we develop an agent-based model, where we explicitly include power sector investment financing. We find that different levels of financing constraints and capital availabilities noticeably impact companies' investment choices and economic performances and that this, in turn, impacts the development of the electricity capacity mix and the pace at which CO2 emissions are reduced. Limited access to capital can delay investments in low-carbon technologies. However, if the financing constraint is too relaxed, the risk of going bankrupt can increase. In general, companies that anticipate carbon prices too high above or too far below the actual development, along with those that use a low hurdle rate, are the ones that are more likely to go bankrupt. Emissions are cut more rapidly when the carbon tax grows faster, but there is overall a greater tendency for agents to go bankrupt when the tax grows faster. Our energy transition model may be particularly useful in the context of the least financially developed markets.

Low Carbon Transition of Power System in China: Pathways and Policy Design Implications

2011 ◽  
Vol 361-363 ◽  
pp. 1832-1836
Author(s):  
Chang Hong Zhao ◽  
Yan Xu ◽  
Jia Hai Yuan
Keyword(s):  
Policy Design ◽  
Reference Value ◽  
Energy Transition ◽  
Energy System ◽  
Transition Management ◽  
Low Carbon ◽  
Policy Makers ◽  
Package Design ◽  
Electricity System ◽  
Low Carbon Energy

This paper studies the low carbon transition of electricity system in China. The paper describes the approach, which builds on transitions and transition management using a multi-level perspective (MLP) of niches, socio-technical regime and landscape. A MLP analysis on China’s power sector is presented to understand the current landscape, regime and niches. Five transition pathways with their possible technology options are presented. The paper goes further to propose an interactive management framework for low carbon energy system transition in China and reprehensive technology options are appraised to indicate the policy package design logic in the framework. The work in the paper will be useful in informing policy-makers and other stakeholders and may provide reference value for other countries for energy transition management.

scholarly journals The effect of differentiating costs of capital by country and technology on the European energy transition

2021 ◽  
Vol 167 (1-2) ◽  
Author(s):  
Friedemann Polzin ◽  
Mark Sanders ◽  
Bjarne Steffen ◽  
Florian Egli ◽  
Tobias S. Schmidt ◽  
...  
Keyword(s):  
Cost Of Capital ◽  
Energy Transition ◽  
Energy System ◽  
World Market ◽  
Low Carbon ◽  
Eu Countries ◽  
Energy Technologies ◽  
Electricity System ◽  
The Cost ◽  
Low Carbon Energy

AbstractCost of capital is an important driver of investment decisions, including the large investments needed to execute the low-carbon energy transition. Most models, however, abstract from country or technology differences in cost of capital and use uniform assumptions. These might lead to biased results regarding the transition of certain countries towards renewables in the power mix and potentially to a sub-optimal use of public resources. In this paper, we differentiate the cost of capital per country and technology for European Union (EU) countries to more accurately reflect real-world market conditions. Using empirical data from the EU, we find significant differences in the cost of capital across countries and energy technologies. Implementing these differentiated costs of capital in an energy model, we show large implications for the technology mix, deployment, carbon emissions and electricity system costs. Cost-reducing effects stemming from financing experience are observed in all EU countries and their impact is larger in the presence of high carbon prices. In sum, we contribute to the development of energy system models with a method to differentiate the cost of capital for incumbent fossil fuel technologies as well as novel renewable technologies. The increasingly accurate projections of such models can help policymakers engineer a more effective and efficient energy transition.

Optimal approaches to manage power system decarbonation

2020 ◽  
Vol 64 (1-4) ◽  
pp. 1447-1452
Author(s):  
Vincent Mazauric ◽  
Ariane Millot ◽  
Claude Le Pape-Gardeux ◽  
Nadia Maïzi
Keyword(s):  
Free Energy ◽  
Linear Programming ◽  
Phase Transitions ◽  
Power System ◽  
Energy System ◽  
Energy Sources ◽  
Low Carbon ◽  
Faraday’S Law ◽  
Optimal Description ◽  
Low Carbon Technologies

To overcome the negative environemental impact of the actual power system, an optimal description of quasi-static electromagnetics relying on a reversible interpretation of the Faraday’s law is given. Due to the overabundance of carbon-free energy sources, this description makes it possible to consider an evolution towards an energy system favoring low-carbon technologies. The management for changing is then explored through a simplified linear-programming problem and an analogy with phase transitions in physics is drawn.

Primary Energy System Chain Security Under the Energy Transition

2021 ◽  
Author(s):  
Osamah Alsayegh
Keyword(s):  
Electric Vehicles ◽  
Energy Demand ◽  
Oil And Gas ◽  
Supply And Demand ◽  
Energy Transition ◽  
System Security ◽  
Energy System ◽  
Primary Energy ◽  
Low Carbon ◽  
Low Carbon Energy

Abstract This paper examines the energy transition consequences on the oil and gas energy system chain as it propagates from net importing through the transit to the net exporting countries (or regions). The fundamental energy system security concerns of importing, transit, and exporting regions are analyzed under the low carbon energy transition dynamics. The analysis is evidence-based on diversification of energy sources, energy supply and demand evolution, and energy demand management development. The analysis results imply that the energy system is going through technological and logistical reallocation of primary energy. The manifestation of such reallocation includes an increase in electrification, the rise of energy carrier options, and clean technologies. Under healthy and normal global economic growth, the reallocation mentioned above would have a mild effect on curbing the oil and gas primary energy demands growth. A case study concerning electric vehicles, which is part of the energy transition aspect, is presented to assess its impact on the energy system, precisely on the fossil fuel demand. Results show that electric vehicles are indirectly fueled, mainly from fossil-fired power stations through electric grids. Moreover, oil byproducts use in the electric vehicle industry confirms the reallocation of the energy system components' roles. The paper's contribution to the literature is the portrayal of the energy system security state under the low carbon energy transition. The significance of this representation is to shed light on the concerns of the net exporting, transit, and net importing regions under such evolution. Subsequently, it facilitates the development of measures toward mitigating world tensions and conflicts, enhancing the global socio-economic wellbeing, and preventing corruption.

scholarly journals The Impact of China’s Low-Carbon Initiative on the Location Expansion of International SPA Enterprises

2021 ◽  
Vol 2021 ◽  
pp. 1-11
Author(s):  
Zhaoyang Zhao ◽  
Chong Ye
Keyword(s):  
Economic Development ◽  
Product Life Cycle ◽  
Large Scale ◽  
High Energy ◽  
Inhibitory Effect ◽  
Low Carbon ◽  
Suppression Effect ◽  
Carbon Neutrality ◽  
The Difference ◽  
The Impact

“Fast fashion” represents a short product life cycle, and international SPA enterprises are therefore criticised as representatives of high energy consumption, pollution, and emissions, which is contrary to China’s goal of achieving carbon neutrality. In the context of China’s shift to a low-carbon economic development model, how should SPA enterprises breakthrough in the face of China’s large-scale market advantage and domestic demand potential? Based on the statistics of 277 prefecture-level cities from 2010 to 2018, this article selects 5 leading international SPA enterprises and uses the difference-in-differences (DID) method to explore the impact of low-carbon initiative on the location expansion of international SPA enterprises. The results suggest that the quantity of location expansions of SPA enterprises in the pilot cities is significantly lower by approximately 0.418 units compared with the nonpilot cities, implying that the low-carbon initiative has a significant inhibitory effect on the location expansion of SPA enterprises. After a series of robustness tests, the conclusion is valid. The results of the heterogeneity test suggest that the suppression effect is mainly found in the subsample of central cities and cities with medium and low levels of economic development. This article proposes that SPA enterprises should reduce their carbon emissions and gradually explore a green and sustainable development path.

scholarly journals Impacts of Electric Road Systems on the German and Swedish Electricity Systems—An Energy System Model Comparison

2021 ◽  
Vol 9 ◽  
Author(s):  
Johanna Olovsson ◽  
Maria Taljegard ◽  
Michael Von Bonin ◽  
Norman Gerhardt ◽  
Filip Johnsson
Keyword(s):  
Wind Power ◽  
Peak Power ◽  
Large Scale ◽  
Solar Power ◽  
Energy System ◽  
Transport Sector ◽  
Electricity System ◽  
Road Systems ◽  
The Impact ◽  
Electricity Systems

This study analyses the impacts of electrification of the transport sector, involving both static charging and electric road systems (ERS), on the Swedish and German electricity systems. The impact on the electricity system of large-scale ERS is investigated by comparing the results from two model packages: 1) a modeling package that consists of an electricity system investment model (ELIN) and electricity system dispatch model (EPOD); and 2) an energy system investment and dispatch model (SCOPE). The same set of scenarios are run for both model packages and the results for ERS are compared. The modeling results show that the additional electricity load arising from large-scale implementation of ERS is mainly, depending on model and scenario, met by investments in wind power in Sweden (40–100%) and in both wind (20–75%) and solar power (40–100%) in Germany. This study also concludes that ERS increase the peak power demand (i.e., the net load) in the electricity system. Therefore, when using ERS, there is a need for additional investments in peak power units and storage technologies to meet this new load. A smart integration of other electricity loads than ERS, such as optimization of static charging at the home location of passenger cars, can facilitate efficient use of renewable electricity also with an electricity system including ERS. A comparison between the results from the different models shows that assumptions and methodological choices dictate which types of investments are made (e.g., wind, solar and thermal power plants) to cover the additional demand for electricity arising from the use of ERS. Nonetheless, both modeling packages yield increases in investments in solar power (Germany) and in wind power (Sweden) in all the scenarios, to cover the new electricity demand for ERS.

scholarly journals Assessing the energy transition in China towards carbon neutrality with a probabilistic framework

2022 ◽  
Vol 13 (1) ◽  
Author(s):  
Shu Zhang ◽  
Wenying Chen
Keyword(s):  
Energy Transition ◽  
Energy System ◽  
Monte Carlo Analysis ◽  
Primary Energy ◽  
Consumption Pattern ◽  
Peak Time ◽  
Carbon Neutrality ◽  
Transition Costs ◽  
Welfare Losses ◽  
Removal Technologies

AbstractA profound transformation of China’s energy system is required to achieve carbon neutrality. Here, we couple Monte Carlo analysis with a bottom-up energy-environment-economy model to generate 3,000 cases with different carbon peak times, technological evolution pathways and cumulative carbon budgets. The results show that if emissions peak in 2025, the carbon neutrality goal calls for a 45–62% electrification rate, 47–78% renewable energy in primary energy supply, 5.2–7.9 TW of solar and wind power, 1.5–2.7 PWh of energy storage usage and 64–1,649 MtCO2 of negative emissions, and synergistically reducing approximately 80% of local air pollutants compared to the present level in 2050. The emission peak time and cumulative carbon budget have significant impacts on the decarbonization pathways, technology choices, and transition costs. Early peaking reduces welfare losses and prevents overreliance on carbon removal technologies. Technology breakthroughs, production and consumption pattern changes, and policy enhancement are urgently required to achieve carbon neutrality.

The Role of Fossil Fuels in a Hydrogen Economy

2021 ◽  
Author(s):  
Hon Chung Lau
Keyword(s):  
Carbon Capture ◽  
Large Scale ◽  
Fossil Fuels ◽  
Carbon Tax ◽  
Developing Economies ◽  
Carbon Capture And Storage ◽  
Energy Transition ◽  
Renewable Energies ◽  
Two Factors ◽  
Final Energy Consumption

Abstract The world of energy is transitioning from one based on fossil-fuels to one based on renewable energies and hydrogen as an energy carrier. At present, only 11% of the world's final energy consumption and less than 1% of industrial hydrogen come from renewable energies. Our analysis shows that this energy transition will take several decades because of two factors. First, renewable energies give more CO2 savings in replacing fossil fuels in the power sector than producing hydrogen for heat generation in the industry sector. Therefore, significant quantities of green hydrogen will not be available until renewable energies have replaced fossil fuels in power generation. This will take at least two decades for advanced economies and twice as long for developing economies. Second, even if blue hydrogen produced by fossil fuels with carbon capture and storage (CCS) is available in large quantities, it is still more expensive than blue fossil fuels which is also decarbonized by CCS. Consequently, fossil fuels and CCS will continue to play a key role in this energy transition. To accelerate this energy transition, governments should introduce a significant carbon tax or carbon credit to incentivize companies to implement large-scale CCS projects. Nations whose governments adopt such policies will go through this energy transition faster and benefit from the associated job creation and economic opportunities.

scholarly journals Long Term Impact of Grid Level Energy Storage on Renewable Energy Penetration and Emissions in the Chilean Electric System

Energies ◽  
2019 ◽  
Vol 12 (6) ◽  
pp. 1070 ◽  
Author(s):  
Serguey Maximov ◽  
Gareth Harrison ◽  
Daniel Friedrich
Keyword(s):  
Energy Storage ◽  
Large Scale ◽  
Level Energy ◽  
Renewable Generation ◽  
Low Carbon ◽  
Solar Pv ◽  
Electricity System ◽  
Long Term Impact ◽  
Grid Level

Chile has abundant solar and wind resources and renewable generation is becoming competitive with fossil fuel generation. However, due to renewable resource variability their large-scale integration into the electricity grid is not trivial. This study evaluates the long-term impact of grid level energy storage, specifically Pumped Thermal Energy Storage (PTES), on the penetration of solar and wind energies and on CO2 emissions reduction in Chile. A cost based linear optimization model of the Chilean electricity system is developed and used to analyse and optimize different renewable generation, transmission and energy storage scenarios until 2050. For the base scenario of decommissioning ageing coal plants and no new coal and large hydro generation, the generation gap is filled by solar photovoltaic (PV), concentrated solar power (CSP) and flexible gas generation with the associated drop of 78% in the CO2 emission factor. The integration of on-grid 8h capacity storage increases the solar PV fraction which leads to a 6% reduction in operation and investment costs by 2050. However, this does not necessarily lead to further reductions in the long term emissions. Thus, it is crucial to consider all aspects of the energy system when planning the transition to a low carbon electricity system.

scholarly journals Circular economy for the energy transition in Saint Petersburg, Russia

2019 ◽  
Vol 110 ◽  
pp. 02030
Author(s):  
Olga Kalchenko ◽  
Svetlana Evseeva ◽  
Oksana Evseeva ◽  
Kristina Plis
Keyword(s):  
Circular Economy ◽  
Environmentally Friendly ◽  
Energy Transition ◽  
Energy System ◽  
Russian Regions ◽  
Low Carbon ◽  
Global Networks ◽  
Saint Petersburg ◽  
Self Sufficiency ◽  
The Government

The pathway to a low-carbon future is circular. Circular economy and the optimization of resources used in the energy system can be seen as a way to improve energy self-sufficiency. In St. Petersburg, stakeholders of International Innovation Forum and International Economic Forum 2018 have discussed foreign experience and circular economy in Russia, and found several solutions. Representatives from Business Finland partnership shared their experience – how environmentally friendly technologies become profitable business. FIRO-O, OptiKom, Charity second-hand store “Spasibo”, Baltika Brewery (Carlsberg group) and St. Petersburg Urban Eco-Cluster are given as successful examples of circular economy principles in Russia and St. Petersburg. Moscow and Saint Petersburg have different programs under the local authorities’ support in the sphere of environmentally-friendly development. Infrastructure of the Russian regions needs more attention and support from all the stakeholders: the business, the government and the society. The triangle cooperation (business-government-society) is needed. Russian company’s cooperation and integration into the global networks of ecologically responsible businesses could lead to the easier and faster solutions.

Sign in / Sign up

Export Citation Format

Share Document