Researchers in EAEI focus on three broad areas: Energy Markets, Policy, and Infrastructure; Energy and Environmental Systems Analysis; and Appliance and Equipment Standards.
We develop analytical and experimental methods and tools to assess the technical, economic and market potential of energy technologies, as well as the associated social, economic, health and environmental impacts.
EAEI researchers provide unbiased, scientific, high quality and innovative research and technical assistance to government agencies in the United States and throughout the world. We help these entities develop long-term strategies, policies and programs that facilitate energy efficiency and the deployment of clean energy technology with minimum environmental and health impacts in all sectors and industries.
China is currently pursuing electricity reforms that will create wholesale markets for electricity. Electricity markets hold considerable promise for facilitating China's transition to clean energy systems, but face obstacles. The most significant obstacle to market reforms is their potential financial impact on coal generation, which currently accounts for most of China's generating capacity. In this paper, we examine the impact of market reforms on coal generation in China, using Guangdong Province as a case study. We find that, in the near term, market prices are likely to lead to significant decreases in net revenues for coal generators relative to the current benchmark tariff, with 40%–60% of coal generation capacity unable to cover the cost of remaining in commercial operation. We estimate that existing coal generators in Guangdong had 94 billion yuan (US$14 billion) in outstanding debt in 2016, creating large risks for banks and raising questions about the potential impacts of electricity market reforms on China's financial industry. The impact of market reforms on coal generators creates two problems—transition and resource adequacy. The development of mechanisms for long-term resource adequacy provides a common solution to both of these problems.