Mechanism and Influencing Factors of Low-Carbon Coal Power Transition under China’s Carbon Trading Scheme: An Evolutionary Game Analysis

Abstract

To avoid the energy supply risk caused by the large-scale integration of renewable power with the grid, coal power plants with carbon capture utilization and storage (CCUS) have the potential to play an important role in the transition to a low-carbon electricity system. Based on evolutionary game theory, this study analyzed the equilibrium states, evolutionary trajectory and the corresponding critical conditions between the government and the coal power enterprises in this process. Subsequently, a numerical analysis was conducted. The results showed that the carbon trading scheme can directly promote the upgrade of coal power and this effect can be enhanced by establishing the market-oriented trading mechanism of electricity. The slack quota policy at the current stage can contribute to the emergence of the forerunners adopting the CCUS. The technical level of the CCUS had the most significant influence on the equilibrium of the game system. As technology advances, the game system can rapidly achieve the ideal stable strategy (of non-intervention, low-carbon upgrade). On this basis, the government should promote the synergetic development of the carbon market and power market. Additionally, more financial subsidies should be shifted to R&D (research and development) investment.