Optimal CO₂ Reduction Investment of Power Plants under Uncertainties

Abstract:

According to the current situation of domestic carbon dioxide (CO₂) reduction and the abatement planning of power plants, the decision-making model for optimal CO₂ abatement investment in power plants has been built concerning uncertainties on CO₂ policies and investment return rate. Under the framework, a case study on power plant was introduced. It is found that (i) higher permits price may stimulate power plants to increase abatement investment under certain return rate, (ii) whether power plants choose to invest more or not depends on the value of returns at fixed carbon price, and (iii) investment and its returns will change in the same directions with the investment return rate. It is suggested that for the mitigation goals to be met in a more efficient way, more stringent CO₂ control measures and policies to lower investment costs should be taken into account.

• Periodical: Advanced Materials Research (Volumes 726-731)
• Pages: 1017-1021
• DOI: https://doi.org/10.4028/www.scientific.net/AMR.726-731.1017
• Online since: August 2013
• Authors: Su Feng Wang*, Mei Deng
• Keywords: Optimization, Power Plant, Reduction Investment, Uncertain Conditions

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