Economic evaluation of flexible transformation in coal-fired power plants with multi price links

The effects of links among the carbon price, feed-in tariff (FIT), and peak shaving price on flexible transformation in coal-fired power plants are not well understood. To address this gap in knowledge, we first designed multi price links to advance coal-fired power plant flexible transformation. Second, the effects of multi price links on coal-fired power plant operation were analyzed. Third, an economic evaluation model for coal-fired power plant flexible transformation was constructed based on fuzzy real option considering multi price links. Finally, stra-tegies for encouraging coal-fired power plant flexible transformation were proposed. The results showed that (1) matching of the peak shaving models and peak shaving depth was a key factor influencing profits during coal-fired power plant flexible transformation. (2) The effects that multi price links had on the market value of coal-fired power plants mainly resulted from the transferring rate of the carbon price to the FIT and elastic electricity demand. (3) The positive effects associated with multi price links on the market value of coal-fired power plants can gradually be realized by increasing the peak shaving depth. This study not only provides a quantitative coal-fired power plant flexible transformation investment decision model for investors, but it would be also beneficial for promoting low-carbon policies.

Automated summary

To address the lack of understanding regarding the effects of links among carbon price, feed-in tariff (FIT), and peak shaving price on flexible transformation in coal-fired power plants, this study designed multi price links, analyzed their effects on coal-fired power plant operation, constructed an economic evaluation model for flexible transformation, and proposed strategies for encouraging transformation. The results indicate that the matching of peak shaving models and depth is a key factor influencing profits, the effects of multi price links on market value are mainly influenced by the transferring rate of the carbon price to FIT and elastic electricity demand, and increasing the peak shaving depth gradually realizes positive effects on market value.