Planning Mechanism Design and Benefit Analysis of Electric Energy Substitution: A Case Study of Tobacco Industry in Yunnan Province, China

Abstract

The problem of fossil energy shortage and pollution has become increasingly prominent. In China, government-led electric energy substitution projects are being carried out in nationwide, aiming at the end of energy consumption links, using electricity instead of coal-fired and oil-fired energy consumption, in order to optimize the energy structure and achieve the goal of energy conservation and emission reduction. Aiming at the planning and benefit sharing of electric energy substitution project, this research first designs the planning mechanism of electric energy substitution for productive users, analyses distribution network planning, transformation subsidy and so on, and puts forward three schemes. Secondly, based on the cooperative game theory, the benefit allocation model of electric energy substitution project is established. Finally, we take the flue-cured tobacco project about replacing coal with electricity in three areas of Yunnan province as an example to analyze, optimize the game strategy, and put forward three indicators to measure the benefits of the participants in the project. The pollution reduction situation that can not be converted into economic benefits is counted. The modeling results show that the density of users geographically will directly affect the cost of the distribution network transformation. The coal flue-cured tobacco heat loss and serious pollution, after optimization, power grid enterprises can quickly recover investment.

Keywords

• Electric energy substitution
• mechanism design
• benefit analysis
• tobacco industry