Impacts of decarbonization policies on electricity cost of different load types: a case study of Shandong

This study built a province-level generation expansion planning model for China’s Shandong province to investigate decarbonization policies’ impact on electricity costs faced by different load types. The model expanded the system starting from 2023 and targets the year 2030, subject to different levels of renewable energy share policies. The paid prices faced by four load types were analysed: residential and agricultural, industrial, commercial, and public services. The results showed that high renewable energy shares, e.g., 40%, would require a green electricity certificate (GEC) price (about 400 CNY/MWh). Together with significant solar installations, high GEC prices would drive down the daytime marginal prices. Furthermore, the impact on the price pattern would create differentiation of the paid prices faced by different load types, e.g., prices faced by the residential load could be 50 CNY/MWh higher than the industrial load without any cross-subsidy. This study also discussed supply-side capacity, generation, capacity payment, and other results and provided policy implications.