Volume 6: Innovative Solutions for Energy Transitions: Part V

The Economic and Climate Impacts of Reducing China’s Renewable Electricity Curtailment Qi Cui, Yu Liu, Ling He1, Guoyi Han, Hao Chen

Abstract

This study use a dynamic multi-sectoral CGE model with different nested structure and substitution elasticity for electricity sectors with different power sources to capture the effects of reducing renewable electricity curtailment across all economic sectors. We found that the reduction of renewable electricity curtailment would lead to a significant increase in renewable electricity generation, and a moderate decrease in non-renewable electricity generation. Among the renewable powers, wind power has the largest increase in activity level. Secondly, the reduction of renewable electricity curtailment would bring green co-benefits that carbon dioxide and air pollutant emissions from power sectors fall significantly, meantime national GDP and employment have slight increases. Third, without the cost-neutrality assumption, the impacts of reducing electricity curtailment would be largely over-estimated with CGE model. Fourth, if with multi-value simulations of CES substitution elasticity, the disparity on nested structure of power sectors would not cause serious disagreement on simulation results.

Keywords Renewable power; Curtailment; Waterenergy nexus; Environmental implications