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Article
Publication date: 11 March 2020

Weiwei Li, Jin-Lou Zhao, Linxiao Dong and Chong Wu

Long-term contract is an important developing direction of China's coal industry coordination. This paper aims to discuss how to use contract for difference (CFD) to avoid risk…

Abstract

Purpose

Long-term contract is an important developing direction of China's coal industry coordination. This paper aims to discuss how to use contract for difference (CFD) to avoid risk and effectively increase the benefit of both coal and thermal power plants in the coal-electricity supply chain.

Design/methodology/approach

Based on prospect theory, this paper takes the risks and benefits of the coal and coal-fired power plants in the coal supply chain under CFD into balanced consideration to construct the contract coordination mechanism. In this mechanism, the coal demand in the coal supply chain equilibrium under centralized decision-making is regarded as the total annual volume of transactions needed to design the contract coordination mechanism and solve double marginalization. Then, based on prospect theory, in the construction of CFD, this paper takes the income of power and coal enterprises when they are in equilibrium under Stackelberg non-cooperative game as the reference point. In addition, considering that coal demand is a random variable, the CFD with a one-year trading session can be designed.

Findings

The research derives the coal price of the contract for difference, contract trading volume and its proportion of the total trading volume. A numerical example shows that the model above can be used to effectively avoid the risk of both coal and electricity sides.

Originality/value

To solve the conflict between coal enterprises and thermal power plants, let the coal-electricity supply chain be converted from non-cooperative game to cooperative game. Based on the prospect theory, this paper takes the income of the non-cooperative game of coal and thermal power plants as a reference point and considers how to design the coordination mechanism, the contract for difference, so as to make the two parties cooperate to solve the double marginal utility of the non-cooperative game in a chain supply. The main innovation of the work lies in the following: first, the coal demand when the coal-electrical supply chain is in balance under centralized decision-making is taken as the total annual trading volume needed to design the contract coordination mechanism and solve double marginalization. Second, based on prospect theory, in the construction of CFD, the benefits of coal-fired power plants and coal enterprises when both sides are in equilibrium under the Stackelberg non-cooperative game are taken as the reference points, and coal demand is taken as a random variable to design the CFD with a one-year transaction period. The price of coal that is not traded through CFD is calculated according to the daily market price. Third, this paper proposes the prospect M-V criterion of the risk-benefit equilibrium of both power and coal enterprises, which means that the risk-benefit equilibrium of both sides is the prospect variance effect of both sides relative to the reference point benefit divided by the prospect expectation effect.

Details

Kybernetes, vol. 50 no. 1
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 28 December 2023

Yadong Dou, Xiaolong Zhang and Ling Chen

The coal-fired power plants have been confronted with new operation challenge since the unified carbon trading market was launched in China. To make the optimal decision for the…

Abstract

Purpose

The coal-fired power plants have been confronted with new operation challenge since the unified carbon trading market was launched in China. To make the optimal decision for the carbon emissions and power production has already been an important subject for the plants. Most of the previous studies only considered the market prices of electricity and coal to optimize the generation plan. However, with the opening of the carbon trading market, carbon emission has become a restrictive factor for power generation. By introducing the carbon-reduction target in the production decision, this study aims to achieve both the environmental and economic benefits for the coal-fired power plants to positively deal with the operational pressure.

Design/methodology/approach

A dynamic optimization approach with both long- and short-term decisions was proposed in this study to control the carbon emissions and power production. First, the operation rules of carbon, electricity and coal markets are analyzed, and a two-step decision-making algorithm for annual and weekly production is presented. Second, a production profit model based on engineering constraints is established, and a greedy heuristics algorithm is applied in the Gurobi solver to obtain the amounts of weekly carbon emission, power generation and coal purchasing. Finally, an example analysis is carried out with five generators of a coal-fired power plant for illustration.

Findings

The results show that the joint information of the multiple markets of carbon, electricity and coal determines the real profitability of power production, which can assist the plants to optimize their production and increase the profits. The case analyses demonstrate that the carbon emission is reduced by 2.89% according to the authors’ method, while the annual profit is improved by 1.55%.

Practical implications

As an important power producer and high carbon emitter, coal-fired power plants should actively participate in the carbon market. Rather than trade blindly at the end of the agreement period, they should deeply associate the prices of carbon, electricity and coal together and realize optimal management of carbon emission and production decision efficiently.

Originality/value

This paper offers an effective method for the coal-fired power plant, which is struggling to survive, to manage its carbon emission and power production optimally.

Details

International Journal of Energy Sector Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 12 September 2016

Jongsawas Chongwatpol

Many power producers are looking for ways to develop smarter energy capabilities to tackle challenges in the sophisticated, non-linear dynamic processes due to the complicated…

2442

Abstract

Purpose

Many power producers are looking for ways to develop smarter energy capabilities to tackle challenges in the sophisticated, non-linear dynamic processes due to the complicated operating conditions. One prominent strategy is to deploy advanced intelligence systems and analytics to monitor key performance indicators, capture insights about the behavior of the electricity generation processes, and identify factors affecting combustion efficiency. Thus, the purpose of this paper is to outline a way to incorporate a business intelligence framework into existing coal-fired power plant data to transform the data into insights and deliver analytical solutions to power producers.

Design/methodology/approach

The proposed ten-step business intelligence framework combines the architectures of database management, business analytics, business performance management, and data visualization to manage existing enterprise data in a coal-fired power plant.

Findings

The results of this study provide plant-wide signals of any unusual operational and coal-quality factors that impact the level of NOx and consequently explain and predict the leading causes of variation in the emission of NOx in the combustion process.

Research limitations/implications

Once the framework is integrated into the power generation process, it is important to ensure that the top management and the data analysts at the plants have the same perceptions of the benefits of big data and analytics in the long run and continue to provide support and awareness of the use of business intelligence technology and infrastructure in operational decision making.

Practical implications

The key finding of this study helps the power plant prioritize the important factors associated with the emission of NOx; closer attention to those factors can be promptly initiated in order to improve the performance of the plant.

Originality/value

The use of big data is not just about implementing new technologies to store and manage bigger databases but rather about extracting value and creating insights from large volumes of data. The challenge is to strategically and operationally reconsider the entire process not only to prepare, integrate, and manage big data but also to make proper decisions as to which data to select for the analysis and how to apply analytical techniques to create value from the data that is in line with the strategic direction of the enterprise. This study seeks to fill this gap by outlining how to implement the proposed business intelligence framework to provide plant-wide signals of any unusual operational and coal-quality factors that impact the level of NOx and to explain and predict the leading causes of variation in the emission of NOx in the combustion process.

Details

Industrial Management & Data Systems, vol. 116 no. 8
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 28 December 2021

Ramin Azargohar, Ajay Dalai, Ebrahim Hassanpour and Saeed Moshiri

Lignite coal-fired power plants are the main electricity generators in the province of Saskatchewan, Canada. Although burning lignite coal to generate power is economical, it…

Abstract

Purpose

Lignite coal-fired power plants are the main electricity generators in the province of Saskatchewan, Canada. Although burning lignite coal to generate power is economical, it produces significant greenhouse gases making it a big challenge to Canada’s international commitment on emission reduction. However, abundant agricultural crops and sawdust produced in Saskatchewan put the province in a good position to produce and use agri-pellets as an alternative fuel to generate electricity. This study aims to conduct an economic and environmental analysis of the replacement of lignite coal by agri-pellets as the fuel for Saskatchewan’s coal-fired power plants.

Design/methodology/approach

The study estimates the economic and environmental costs and benefits of two alternative fuels for power plants. The economic analysis is based on the pellet production and transportation costs from farms to production sites and from the production sites to power plants. In the production process, biomass precursors are densified with and without additives to produce fuel agri-pellets with appropriate mechanical durability and high heating value per volume unit. The environmental analysis involves estimation of greenhouse gas emissions and their social costs for lignite coal and different types of agri-pellets under different scenarios for pellet production and transportation.

Findings

The results show that although the total cost of electricity is lower for coal than agri-pellets, the gap shrinks when social costs and specifically a carbon price of $50/tonne are included in the model. The cost of electricity in lignite coal-fired power plants would also be on par with agri-pellets-fired power plants if the carbon price is between U$68 and $78 per tonne depending on the power plant locations. Therefore, a transition from coal to agri-pellet fuels is feasible if a high-enough price is assigned to carbon. The method and the results can be generalized to other places with similar conditions.

Research limitations/implications

There are a few caveats in this study as follows. First, the fixed costs associated with the transformation of the existing coal-fired power plants to pellet-fired plants are not considered. Second, the technological progress in the transportation sector, which would favor the net benefits of using pellets versus coal, is not included in the analysis. Finally, the study does not address the possible political challenges facing the transition in the context of the Canadian federal system.

Practical implications

The study results indicate that the current carbon price of $50 per tonne is not sufficient to make the agri-pellets a feasible source of alternative energy in Saskatchewan. However, if carbon pricing continues to rise by $15 annually starting in 2022, as announced, a transition from coal to agri-pellets will be economically feasible.

Social implications

Canada is committed to reduce its emission according to the Paris agreement, and therefore, needs to have a concrete policy to find alternative energy sources for its coal-fired power plants. This study examines the challenges and benefits of such transition using the existing agri-pellet resources in Saskatchewan, a province with abundant agricultural residues and coal-fired power plants. The findings indicate that a significant emission reduction can be achieved by using agri-pellets instead of coal to produce electricity. The study also implies that the transition to renewable energy is economical when social costs of carbon (carbon tax) is included in the analysis.

Originality/value

As far as the authors know, this is the first study providing a socio-economic analysis for a possible transition from the coal-fired power plants to a more clean and sustainable renewable energy source in one of the highest carbon dioxide (CO2) producer provinces in Canada: Saskatchewan. The study builds upon the technical production of three agri-pellets (oat hull, canola hull and sawdust) and estimates the economic and environmental costs of alternative fuels under different scenarios.

Details

International Journal of Energy Sector Management, vol. 16 no. 5
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 1 August 2016

Wei Pian, Wenjing Cheng, Hongya Niu and Jingsen Fan

This study aims to focus on the submicron particles (with diameter of 0.2-1.0 μm) of the ambient air from a coal-fired power plant. A systematic examination of their morphology…

Abstract

Purpose

This study aims to focus on the submicron particles (with diameter of 0.2-1.0 μm) of the ambient air from a coal-fired power plant. A systematic examination of their morphology, particle size and chemical element will be analyzed, so as to provide more scientific information and theoretical basis for the formation and control method of inhalable particles, as well as data support for environmental impact and ecological effects assessments.

Design/methodology/approach

In this paper, the morphology, size distribution and elemental characteristics of submicron particles from ambient air of a coal-fired power plant are studied by single particle analysis.

Findings

The results show that atmospheric particles in coal-fired power plant are mainly spherical particles, and most of them are soot aggregates adhered or coated with other particles with few rectangle particles. The particles collected in the afternoon and evening are mainly of spherical particles, and small-sized particles collected in the morning are mainly spherical ones, while the overall concentration is larger than that of the spherical particles in the size range above 0.5 μm. The results indicated that the larger-sized spherical particles have a lower concentration.

Originality/value

Coal-fired power plants are still the main supply of electricity in China, but the inhalable particles, especially sub-micron particles (0.1-1.0 μm) cannot be effectively captured by the dust removal device from the coal-fired power plant. Thus, a large amount of inhalable particles is emitted into the atmosphere, becoming the major air pollutants in China.

Details

World Journal of Engineering, vol. 13 no. 4
Type: Research Article
ISSN: 1708-5284

Keywords

Expert briefing
Publication date: 16 August 2023

The destruction of Akbelen forest to provide coal for power plants highlights Turkey’s weak commitment to reducing carbon dioxide emissions. New coal-fired power plants are still…

Details

DOI: 10.1108/OXAN-DB281252

ISSN: 2633-304X

Keywords

Geographic
Topical
Expert briefing
Publication date: 6 January 2020

Energy policy in China.

Details

DOI: 10.1108/OXAN-DB249782

ISSN: 2633-304X

Keywords

Geographic
Topical
Article
Publication date: 6 April 2023

Marcelo Battesini and Jair Carlos Koppe

This study aims to propose an approach to assess the security of supply (SS) in a coal-fired electricity generation supply chain subject to public price regulation in Brazil. This…

Abstract

Purpose

This study aims to propose an approach to assess the security of supply (SS) in a coal-fired electricity generation supply chain subject to public price regulation in Brazil. This study characterizes the Brazilian scenario of coal-fired electricity generation, which represents less than 3.5% of the energy sources.

Design/methodology/approach

Data from six mining companies that supply a coal plant were analyzed in a case study. The risks were characterized and objectively estimated through a synthetic multidimensional index. Structural changes in the earnings before interest, taxes, depreciation, amortization and exploration indicator time series of coal companies (CC) were statistically detected.

Findings

Empirical evidence demonstrates that the supply chain has a low disruption risk (SS index equal to 0.74). However, when suppliers are individually analyzed, 48.64% of all coal shows moderated disruption risk, and 2.51% is under high risk. In addition, this study finds a drop in the financial results of CC related to public regulation of coal prices. This impacts the security of coal supply.

Research limitations/implications

This study discusses the influence of legal and regulatory policy risks in a coal power generation supply chain and the implications of the SS index as a management tool.

Originality/value

A novel SS index is presented and empirically operationalized, and its dimensions – environmental, occupational, operational, economic-financial and supply capacity – are analyzed.

Details

International Journal of Energy Sector Management, vol. 18 no. 2
Type: Research Article
ISSN: 1750-6220

Keywords

Content available
Article
Publication date: 24 December 2021

Iram Khalid, Tooba Ahmad and Sami Ullah

Human-induced changes in climate have affected the environment to the extent that any more economic development at the cost of the environment will be too costly. Thus…

1719

Abstract

Purpose

Human-induced changes in climate have affected the environment to the extent that any more economic development at the cost of the environment will be too costly. Thus, sustainable development options posing no additional harm to the environment are the only viable option. This study aims to examine the likely environmental impacts of infrastructural developments through the China–Pakistan Economic Corridor (CPEC).

Design/methodology/approach

There is a scarcity of academic debate and discussion on the environmental impact of CPEC developments in laws and policies on the environment. The qualitative approach is followed in this study and official documents and reports are used to investigate the environmental challenges posed by CPEC.

Findings

The findings show three possible environmental concerns which could increase the climate change vulnerability of Pakistan. The coal-fired power plants are the most prominent threat based on their CO2 contributions and smog. Second, cutting more than 54,000 trees for roads infrastructure will increase CO2 concentration along the CPEC route. Third, increasing vehicle trafficking by up to 7,000 trucks per day on Karakorum Highway alone will release 36.5 million tons of additional CO2.

Originality/value

It is essential to rethink the environmental cost of CPEC. The study suggests economic and legal cooperation between Pakistan and China as a way forward to deal with climate change issues. Environmental laws should be a vital part of CPEC projects to ensure their safety, security and sustainability.

Details

International Journal of Development Issues, vol. 21 no. 1
Type: Research Article
ISSN: 1446-8956

Keywords

Article
Publication date: 5 April 2013

Sudhir Kumar Singh, Vijay Kumar Bajpai and T.K. Garg

This paper aims to study the changes in productivity for 25 state‐owned coal‐fired power plants (CFPPs) over a period of seven years (2003‐2010).

Abstract

Purpose

This paper aims to study the changes in productivity for 25 state‐owned coal‐fired power plants (CFPPs) over a period of seven years (2003‐2010).

Design/methodology/approach

The methodology that is utilized in the study follows a non‐parametric approach of data envelopment analysis (DEA) and uses the Malmquist index to estimate the change in productivity of panel samples. In the calculations, the study considers installed capacity, fuel, labour, electricity used, and average operational time as inputs and considers net electricity produced as output.

Findings

The results indicate that the average total factor productivity regressed during the investigation period at an annual rate of 2 percent. The decrease in productivity is equally attributed to the technical efficiency change and technological change components, with an average decline in productivity of 1 percent per year. A plant‐wise analysis demonstrates that the Parichha plant recorded an average increase in productivity of 3.9 percent per year that was mainly driven by the technical efficiency change component (4.2 percent).There is little variation in the productivity of small‐size plants when compared with medium and large‐size plants. The productivity of multivaried plants is comparatively lower than BHEL (Bharat Heavy Electricals Limited) make plants.

Originality/value

The impact of size, make and region on change in productivity is examined. This study recommends specific policies that can be implemented to increase the productivity of power plants. The study also provides a contemporary overview of Indian CFPPs that can aid energy planners and plant operators in the monitoring and detection of changes in productivity.

Details

International Journal of Energy Sector Management, vol. 7 no. 1
Type: Research Article
ISSN: 1750-6220

Keywords

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