ABSTRACT
Power sector investment is crucial to accelerate a sustainable energy transition, but not all investments are successful. We examine 1,393 Chinese overseas electric power projects across 78 countries over the past two decades. We identify 5% that have been canceled or delayed, with coal and hydro projects having much higher suspension rates than solar and wind projects. We find electric projects with higher environmental risks are more likely to be suspended. Specifically, coal projects located in more densely populated areas where more people are exposed to air pollutants, in countries with more fatalities from extreme weather events, and in places with a record of environmental protests, are more likely to be suspended. Additionally, hydro projects closer to protected areas have a higher suspension rate. Our results suggest that refraining from investing in environmentally risky projects helps mitigate environmental damages and prevents financial losses due to cancellation and postponement.
ABSTRACT
Continued fossil fuel development puts existing assets at risk of exceeding the capacity compatible with limiting global warming below 2 °C. However, it has been argued that plant conversions and new abatement technologies may allow for a smoother transition. We quantify the impact of future technology availability on the need for fossil fuel power plants to be stranded, i.e. decommissioned or underused. Even with carbon capture and storage (CCS) and bioenergy widely deployed in the future, a total of 267 PWh electricity generation (ten times global electricity production in 2018) may still be stranded. Coal-to-gas conversions could prevent 10-30 PWh of stranded generation. CCS retrofits, combined with biomass co-firing, could prevent 33-68 PWh. In contrast, lack of deployment of CCS or bioenergy could increase stranding by 69 or 45 percent respectively. Stranding risks remain under optimistic technology assumptions and even more so if CCS and bioenergy are not deployed at scale.
