The persistence of flexible coal in a deeply decarbonizing energy system

Abstract

Extensive literature has highlighted the difficulty in operating baseload power plants—especially coal-fired units—in a decarbonized electric power system with a high share of variable renewable energy, with some of it recommending immediate coal phaseouts. However, the coal fleet across China is large and young, making its imminent phaseout unrealistic. Moreover, power system operators and policy makers face other constraints in their pursuit of energy system decarbonization—chief among them the need to achieve high levels of reliability—something coal units could provide. We assess the persistence of coal in a decarbonizing power system under various retrofit scenarios that seek to enhance the flexibility of coal units: after all, energy transitions do not occur in a vacuum and owners of coal power plants will likely pursue innovations to extend the lifetimes and profits of their assets, even as the wider energy transition unfolds. We evaluate the economic and environmental impacts of improving coal power unit flexibility in Jiangsu’s power system under four levels of renewable energy penetration and three scopes of coal flexibility retrofits. Our results show that coal units persist even at very high renewable penetrations, and retrofits help them reduce power system costs, enable renewable energy integration, and marginally cut emissions. Smaller coal units become peaker rather than baseload units, providing the power system with flexibility rather than just energy. Our results show how challenging the low-carbon transition is likely to be without outright phaseouts of coal generation.