Impacts of Renewable Energy Quota System on China's Future Power Sector

As the biggest carbon emitting sector which produces 44% of current national carbon emission in China, the coal-dominated power sector has a tremendous potential for CO2 mitigation in the next two decades. Renewable energy quota system is currently discussed as a potential future policy instrument for the power sector, which requires certain fraction of renewable energy in total power generation for each province and grid zone.

The quantitative studies on renewable energy quota for China are still very limited. Based on a least-cost and technology-rich power generation and transmission expansion model for China, this study examines the impacts of renewable energy quota system and carbon cap policy instruments on the future Chinese power sector.

Various scenarios are examined toward 2030 and their future power generation mix, capacity installations and carbon emission are discussed. This study concludes that while the renewable quota alone would be drive significant increase of renewable generation in the long term, with slightly increase of system cost compared with carbon cap policy.