Identifying the Determinants of CO 2 Emission Change in China ’ s Power Sector

Power sector is significantly important for China to achieve theCO2 emission reduction targets. In this study, we analyze the features of CO2 emissions and environment effect in China’s power sector, investigate the driving factors of CO2 emission change based on the logarithmic mean Divisia index (LMDI) method, and evaluate the mitigation potential of CO2 emissions in China’s power sector. Results show that CO2 emissions in China’s power sector increased rapidly from 492.00Mt in 1990 to 3049.88Mt in 2014 while CO2 emission intensity experienced an unsteady downward trend during the study period. Industrial scale effect is the key contributor to CO2 emission growth in China’s power sector, and its contribution degree reaches 123.97%. Energy intensity effect contributes most to the decrease in CO2 emissions, with a contribution degree of −20.01%. Capital productivity effect is another important factor leading to CO2 emissions increase.The aggregate CO2 emission reduction would reach 17973.86million tons (Mt) during 2015–2030 in the ideal emission reduction scenario. Finally, policy recommendations are made for future energy-saving and CO2 emission reduction in China’s power sector.


Introduction
Climate change has aroused growing concern worldwide due to its contribution to environmental pollution and being an obstacle to sustainable socioeconomic development [1].The ongoing emission of greenhouse gas (GHG) which gives priority to carbon dioxide is responsible for the climate change.In the context of limited energy resources availability and increasingly serious environmental problems, the development of low-carbon economy with lower power consumption and CO 2 emissions is becoming a common choice for the world economic development to mitigate climate change and achieve sustainable development.As world's largest emitter of CO 2 emissions [2], China has attached great importance to transition to a low-carbon economy and taken effective measures to support it through industrial restructuring, renewable energy consumption promotion, and carbon market establishment [3].
China's power sector plays a leading role in CO 2 emissions of China.In 2013, CO 2 emissions of China's power sector accounted for 48.86% of the total CO 2 emissions.The lowcarbon development of China's power sector drives the lowcarbon development of energy-economic-society in China.Therefore, the CO 2 emission reduction in China's power sector becomes the key factor to achieve the low-carbon development of China.In addition, power sector belongs to the fundamentals of industrial production and residents' living which are being conquered by electricity.It is particularly important to balance the relationship between adequate supply of electricity and CO 2 mitigation when developing strategies for mitigating the increasing CO 2 emissions and global climate change.Therefore, the analysis of the CO 2 emissions in China's power sector is very important.
Against this background, many studies on CO 2 emissions in China's power sector have been conducted.The work in [4] presented the results of a life cycle analysis of GHG emissions from power generation systems to understand the characteristics of these systems from the perspective of global warming.The work in [5] quantified the CO 2 emissions of the power sector from both production and consumption perspectives and explained the environmental impact of the regional supply and demand mismatch of electricity in China.The work in [6] proposed a consumer responsibility method to calculate the CO 2 emissions of the power sector at the provincial level in China based on the detailed origins of each province's electricity consumption.The work in [7] conducted a cointegration analysis to explore the significant factors affecting CO 2 emissions in China's power sector including standard coal consumption rate for generating power, average thermal power equipment utilization hours, and industrial value added.The work in [8] conducted a comparative study of dynamic changes in CO 2 emission performance of fossil fuel power plants in China and Korea through developing a new index called the nonradial metafrontier Malmquist CO 2 emissions performance index (NMMCPI).The NMMCPI was decomposed into an efficiency change index, a best-practice gap change index, and a technology gap change index.The proceeding literatures mainly analyzed the evolution trends and the influencing factors of CO 2 emissions in the power sector.
The LMDI method is a preferred index decomposition analysis approach not only because of being less data intensive and more diverse in decomposition forms but also because of the advantages of path independence, being residue free, ability to handle zero values, and consistency in aggregation [9,10].In recent studies, the LMDI method is widely used to identify the major influencing factors of CO 2 emission change.The energy-related CO 2 emissions were decomposed into carbon intensity effect, energy structure effect (or substitution effect), energy intensity effect, and industrial activity effect and industrial scale effect in the textile industry [11], nonmetallic mineral products industry [12], and cement industry [13] and chemical industry [14].CO 2 emissions change in the Chinese manufacturing industry was decomposed into the emission coefficient effect, energy structure effect, energy intensity effect, economic structure effect, and economic scale effect [15].The work in [16] decomposed the CO 2 emissions of China's cement industry into kiln efficiency effect, clinker share effect, structural shift effect and activity effect, which reflected the production features of cement industry.As a popular method, LMDI is used to explore the affecting factors of CO 2 emission change at sector level.
Less literature is involved in the study on the driving factors of CO 2 emission in China's power sector.Research on the reduction potential of CO 2 emissions in China's power sector is limited.Therefore, this study decomposes the CO 2 emission change of China's power sector into five parts using the improved Kaya identity and LMDI method, predicts the CO 2 emissions, and assesses the emission reduction potential based on scenarios analysis.More importantly, this study proposes the comprehensive CO 2 emission reduction policy recommendations for policymakers.
The remainder of this study is organized as follows.Section 2 presents the methodology and data sources.Section 3 provides the LMDI decomposition results by time series and time intervals and conducts the scenario analysis.Section 4 draws the research conclusions and proposes policy recommendations.

Estimation of Environment Effect.
The IPAT identity is often used as a basis for investigating the effect of economic activities on emissions.
where  represents environmental impact, typically measured in terms of the emission level of a pollutant,  denotes population size,  represents the wealth of a society, measured by per capita GDP, and  is a technology index, which is generally measured by the effect on the environment per unit of GDP.IPAT identity is used to analyze the environment condition at economy-wide level and indexes such as employee, productivity, and energy efficiency are suitable for the analysis of environment issue at industry level.In order to fully examine the environmental effect at industry level, this study use installed capacity, average power generation capacity per unit installed capacity, and energy intensity to substitute for population or employee, per capita GDP, and technology index.Because the power sector is capitalintensive sector, it is reasonable to use the indexes of capital input and capital productivity to analyze the effect of power sector development.However, the purpose of the index rate of  is to provide an absolute effect of power sector development and reveal the influencing trend and thus help to identity the whole effect on environmental condition of power sector.

Estimation of Energy-Related CO 2
Emissions.According to the method proposed by Intergovernmental Panel on Climate Change (IPCC), the total energy-related CO 2 emissions in China's power sector can be calculated based on energy consumption, CO 2 emission factor, and the fraction of oxidized carbon, followed by where   denotes total energy-related CO where    denotes fossil energy consumption of China's power sector in year ;   denotes the total energy consumption in year ;   denotes the total output in year , referring to the total power generation capacity in this study; and   denotes the installed capacity of China's power sector.In this study, we use installed capacity to represent the industrial scale in this study; CI =   /   is the CO 2 emissions factor; ES =    /  denotes the energy structure; EI =   /  denotes the energy intensity; and IA =   /  denotes the capital utilization efficiency, namely, the average power generation capacity per unit installed capacity.

LMDI Decomposition Method.
In this paper, LMDI method is adopted to uncover the key influencing factors to CO 2 emissions growth in China's power sector.We decompose the CO 2 emissions change (Δ) in China's power sector into five driving factors, that is, carbon intensity effect (CI eff ), energy structure effect (ES eff ), energy intensity effect (EI eff ), capital efficiency effect (IA eff ), and industrial scale effect (IS eff ).
The additive form of decomposition is usually used to identify the absolute change of aggregate indicator while the multiplicative decomposition is applied to a relative change of the aggregate variables.Therefore, based on the additive form of decomposition, CO 2 emissions change of China's power sector between  year and  + 1 year is expressed as The effects of driving factors of CO 2 emissions in China's power sector between  year and  + 1 year are calculated by the following equations: CO 2 emissions change of China's power sector between 0 year and  year is expressed as And, the effects of various driving factors of CO 2 emissions in China's power sector between 0 year and  year are calculated by the following equations: The effects of various driving factors are calculated by the following equations: where And the symbols , , , , and  represent the growth rate of various variables between the base year 0 and the target year .emission intensity means the CO 2 emissions per unit of power generation.Figure 1 displays that, during 1990-2014, total CO 2 emissions in China's power sector showed an upward trend while the CO 2 emission intensity experienced a downward trend.CO 2 emissions in China's power sector increased continuously from 492.00 Mt in 1990 to 3049.88 Mt in 2014, with an aggregate growth of 519.89%.This increase in CO 2 emissions of China's power sector was largely due to the increasing power generation capacity.In the past two decades, the urbanization and industrialization in China improved continuously, and power generation increased rapidly to meet growing power demand.During 1990-2014, thermal power generation capacity even accounted for about 80%.Thus, increasing power generation led to large amount of fossil energy consumption and CO 2 emissions.Specifically speaking, CO 2 emissions of China's power sector during 2002-2011 increased significantly, and the average annual growth rate reached 11.10% which was higher than the average level during the whole study period (7.80%).The rapid increase in CO 2 emissions of China's power sector during In general, CO 2 emission intensity in China's power sector declined during the study period, which was attributed to the improvement of energy efficiency.CO 2 emission intensity reduced from 0.99 kg CO 2 /kWh in 1990 to 0.71 kg CO 2 /kWh in 2014, with a decline rate of 28.19%.It should be noted that CO 2 emission intensity in China's power sector did not show a continuous decline trend and fluctuated during 1990-2014.Even during 1995-1997 and 2004-2005, CO 2 emission intensity rose instead, and energy efficiency was certain to be depressed.The significant decline in CO 2 emission intensity of China's power sector occurred from 2004 and corresponding average annual change rate was 2.55% during 2004-2014, which indicated that energy efficiency improved distinctively.

Comparison of CO 2 Emissions with Other Sectors.
Power sector accounted for the largest share of CO 2 emissions in China.Figure 2   decreased to 2.64% in 2014.As to agriculture sector (AGR), its CO 2 emissions accounted for a very small part in national CO 2 emissions and corresponding share is below 1%.

Contribution of Each
Factor. Figure 3 shows the contribution degree of each factor to CO 2 emission change in China's power sector during 1990-2014.In this study, CO 2 emission change in China's power sector is decomposed into five parts: carbon intensity effect (CI eff ), energy structure effect (ES eff ), energy intensity effect (EI eff ), capital efficiency effect (IA eff ), and industrial scale effect (IS eff ).
During 1990-2014, CO 2 emissions in China's power sector increased 2735.70 Mt.The contribution of carbon intensity effect, energy structure effect, energy intensity effect, capital efficiency effect, and industrial scale effect is −6.99 Mt −22.65 Mt, −547.51Mt, −78.55 Mt, and 3391.40Mt, respectively, and corresponding share is −0.26%, −0.83%, −20.01%, −2.87%, and 123.97%.Obviously, industrial scale effect is the dominant driving factor to CO 2 emission increase, which reveals that the industrial production expansion leads to the increase in fossil energy consumption and CO 2 emissions.In contrast, energy intensity effect is the key factor restraining the CO 2 emission increase, indicating that significant energy efficiency improvement in China's power sector reduces fossil energy consumption and CO 2 emissions.In addition, capital efficiency effect is another important factor leading CO 2 emission decrease.Therefore, we put emphasis on the above three driving factors, that is, industrial scale effect, energy intensity effect, and capital efficiency effect.Both carbon intensity effect and energy structure effect are negative, indicating that they also promote the decrease in CO 2 emissions.Considering relatively small contribution, carbon intensity effect and energy structure effect are analyzed briefly in this study.electricity market reform leads to the significant increase in installed capacity and power generations, which generates large amount of fossil energy consumption and CO 2 emissions.The growth of thermal power generation slows down along with the development and utilization of renewable energy sources generation and surplus power supply, which leads to the decrease in the effect of industrial scale.

Decomposition of Time Series.
Figure 5 shows the evolution trends of power generation installed capacity in China's power sector during 1990-2014.There is a significant and sustained increase in installed

Energy Intensity Effect.
As shown in Figure 4, the effect of energy intensity presents the positive and negative evolution trend as the energy efficiency change of China's power sector.The improvement of energy efficiency decreases the energy consumption and CO 2 emissions per unit of power generation.Therefore, the effect of energy intensity depends on the change of energy efficiency.Except for some specific years, energy intensity effect showed a negative trend which is attributed to the improvement of energy efficiency.Energy intensity reached its positive maximum of 74.91 Mt in 2004 and the negative maximum of 203.35 Mt in 2010.
Figure 6 shows the energy intensity change in China's power sector during 1990-2014.The change of growth rate of energy intensity is almost consistent with the change of energy intensity effect.Energy intensity in China's power sector continued to decline during 2004-2014 and fluctuated during 1990-2004.The introduction of new power generation technology and energy-saving technology improved the energy efficiency of China's power sector.In addition, improvement of energy efficiency standards, the elimination of backward production capacity, and the shutdowns of small power enterprises also contributed to the improvement of energy efficiency.Unusually, energy intensity increased during 2002-2004.The early electricity market reform promoted the disordered development of the power sector because of the insufficient market and supervision system.

Capital Efficiency Effect.
Capital efficiency effect indicates the effect of capital utilization efficiency on CO 2 emissions.The improvement of capital efficiency reduces the waste of energy recourses and thus decreases the energy consumption and CO 2 emissions of generating one unit of electricity.Figure 4 shows that during 2000-2004 and during 2010-2011 the effect of capital efficiency increased the CO 2 emissions in China's power sector.Surplus power supply was the key reason for the decline of capital efficiency.Power sector experienced a rapid development during 2002-2014 while the development of China's economy slowed down during the corresponding study periods.The growth rate of power generation capacity exceeded the power demand of economic development, which led to the decrease of capital efficiency.After the Asian financial crisis, the growth rate of capital efficiency improvement in China's power sector declined constantly, and the effect of capital efficiency on CO 2 emissions turned to the positive during 2000-2004.The decline of the growth rate of China's economic development was affected by the US Subprime Mortgage Crisis and economic structure adjustment; therefore, the power supply became surplus and the effect of capital efficiency was positive during 2010-2011.However, development of intelligent power system also promoted the improvement of power resources and power units and improved the capital efficiency.

Energy Structure Effect.
The effect of energy structure shows a varying trend and is relatively small.Energy structure effect is almost negative during the whole study period, which indicates the continuous low carbonization of energy structure.Large scale of development and utilization of renewable energy resources promotes the optimization of energy structure.The effect of energy structure was roughly negative during 1990-2002, which revealed the increasing share of renewable power generation.However, after power market reform in 2002, the small and thermal power developed significantly during 2002-2006, leading to rapid increase in the fossil energy consumption.
Carbon intensity effect fluctuates around coordinate axe.Carbon intensity effect denotes the effect of the substitute among fossil energy.The increase of carbon intensity effect means the energy substitute from low-carbon content (such as oil and natural gas) to high-carbon content (such as coal).Carbon intensity effect did not show a clear change trend during 1990-2014.The effect of carbon intensity is very small.

Definition of Time Intervals.
The purpose of decomposition analysis of time intervals is to better understand the CO 2 emissions change during time intervals.Based on the features of CO 2 emissions evolution of China's power sector, the study period is divided into four stages (see Figure 6 CO 2 emissions and we defined this time period as remaining steady stage.In the third stage, China's power sector experienced a rapid increase in CO 2 emissions and CO 2 emission increased significantly from 1143.70 Mt to 2501.21Mt during 2002-2009; therefore, we defined the third stage as highspeed growth stage.In the fourth stage, the growth rate of CO 2 emissions decreased, and CO 2 emissions appeared to be a downward trend which was affected by the transformation of national economic development strategy.

Decomposition Analysis of CO 2 Emission Change by
Time Interval.Decomposition analysis by time interval quantifies the impact of each driving factor to CO 2 emission change.The results of LMDI decomposition of CO 2 emission change by time interval in China's power sector are shown in Figure 8.In general, there has been a significant increase in CO 2 emissions of China's power sector during 1990-2014.CO 2 emissions in China's power sector increased by 2557.88Mt, which is appropriately 519.10% of the level in 1990.CO 2 emission change varies among the four time intervals.The CO 2 emission growth during the last two intervals is higher than that during the first two time intervals.In particular, CO  7 illustrates that industrial scale effect contributes to most of CO 2 emissions during each time interval.Industrial scale expansion and consequent power generation lead to the significant increase in both energy consumption and CO 2 emissions, mainly driven by the constant and high-speed development of national economy.Industrial scale expansion leads to the increase in the CO 2 emissions with varying degrees among the time intervals.Energy intensity effect plays a crucial role in curbing CO 2 emission increase in China's power sector.The improvement in energy efficiency is the key reason to curb the CO 2 emission increase.Capital productivity effect is another main factor that results in the decrease in CO 2 emissions.Capital productivity improvement lowers the waste of energy Energy intensity effect is 5.24 Mt, indicating that energy efficiency decreased during 1990-1997.The key reason for the decrease in energy efficiency is the rapid development of small thermal power enterprises, energy efficiency standards, and loose market mechanism.During 1990-1997, more attention was paid to the increasing power demand and power generation capacity due to rapid economic development, industrialization, and urbanization.Sustainable and lowcarbon development of China's power sector was ignored, which led to the decrease in energy efficiency.
Capital productivity effect reduces CO 2 emissions by 0.64 Mt on the first stage, indicating that capital productivity improved lightly.During 1990-1997, in the context of rapid economic development, low-level industrialization and insufficient construction of power infrastructure result in insufficient power supply, and power generation units are always in high-load operation.Therefore, capital productivity effect is relatively small.
Both energy structure effect and carbon intensity effect are very small on the first stage, which reveals that the coal-dominant energy structure in China's power sector is unchanged.
(2) 1997-2002.In this stage, industrial scale effect is depressed sharply while other effects go up significantly.CO 2 emissions increased by 235.10 Mt during 1997-2002, which is lower than that in the other stages.Effect of industrial scale expansion during 1997-2002 drops to 353.78 Mt which is the lowest level in the four stages, while contribution of industrial scale effect reaches the highest level (150.48%).The reason lies in the Asian financial crisis in 1997.When the Asian financial crisis struck China, the economic growth rate of China fell sharply.Affected by declining power demand, power generation dropped during 1997-2002.Accordingly, effect of industrial scale decreased.
Meanwhile, backward production capacity with lower energy efficiency was eliminated.The overall energy efficiency in China's power sector improved substantially.Effect of energy intensity improvement reduces CO 2 emissions by 129.88 Mt during 1997-2002, accounting for 55.24% of the total CO 2 emissions on this stage.
Economic depression cut down power demand, leading to power generation units standing idle.Therefore, during 1997-2002, capital productivity declined.Effect of capital productivity increases CO 2 emissions by 18.15 Mt, which is appropriately 7.72% of the CO 2 emissions change.
Energy structure effect is −10.77Mt during 1997-2002, which suggests the optimization of energy structure in China's power sector.In addition, carbon intensity effect during 1997-2002 is 3.81 Mt, indicating the energy consumption shift from high-carbon content to high-carbon content.
(3) 2002-2009.The CO 2 emission growth because of the expansion of power industrial scale amounts to 1555.57Mt during 2002-2009.The key reason for the rapid expansion of the power sector during 2002-2009 was the mounting power demand during the rapid industrialization and urbanization process.The output increase of energy-intensive industries promoted the power demand and power generation.The production of major home appliances also underwent a rapid increase.Since 2002, power market reform has promoted the increase of installed capacity and power generation.In the loose market access mechanism, high profit drove the fixed assets investment in the power sector due to the lower production costs of thermal power generation than that of renewable power generation.Consequently, fossil energy consumption and CO 2 emissions increased rapidly in China's power sector during 2002-2007.
The energy intensity effect during the study period plays a significant role in reducing the CO 2 emissions of China's power sector during 2002-2007.Energy intensity effect reduces CO 2 emissions by 76.40 Mt.The decrease of energy intensity of China's power sector basically depends on the improvement of energy efficiency standards, the introduction of advanced energy-saving technology, and the elimination of backward production capacity (i.e., shutting down the small thermal units).
The effect of capital productivity is −129.85Mt during 2002-2009, which demonstrated that utilization efficiency of power units improved.The reasons for capital efficiency improvement are the increasing power demand from national economic development and the insufficient supply of power generation, leading to the high-load and long-time operation of power units.
In addition, energy structure effect is 6.29 Mt during 2002-2009.The positive effect of energy structure denotes the increasing share of fossil energy consumption.
(4) 2009-2014.During 2009-2014, CO 2 emissions of China's power sector increased by 728.78 Mt.Industrial scale effect leads to CO 2 emissions increase by 1072.49Mt, accounting for 147.16% of the total CO 2 emissions change.In contrast, the growth rate of CO 2 emissions lowered during 2009-2014 compared with the level during 2002-2009.Affected by American subprime mortgage crisis in 2008, the economic development was sputtering and power demand was also deficient.In the context of the "new normal" economy development stage, adjustment of economic development structure restrained the energy consumption because the development of high energy consuming industries was limited.Therefore, inadequate power demand and decreasing power consumption reduced the CO 2 emission in China's power sector.
The effect of energy intensity reached the maximum during 2009-2014, revealing that energy efficiency in China's power sector largely improved.Energy intensity effect accounted for 47.54% of the total CO 2 emission change during the fourth stage.
Energy efficiency in China's power sector improved remarkably during 2009-2014.
Introduction of new energy-saving technology and higher energy efficiency standards all contributed to energy efficiency improvement of China's power sector.After 2009, increasing surplus power supply drove more power units with higher energy efficiency and lower production costs to participate in power generation, which improved the overall energy efficiency in China's power sector.
By contrast, the effect of capital productivity is positive during 2002-2009.The large-scale use of air conditioning systems contributes to the increase of the maximum load and peak valley, which drive the increase of installed capacity and the decrease of load rate and unit utilization efficiency.In addition, the transformation of economic growth mode pulled by investment leads to the decline of power consumption growth and the power units and generation capacity becomes surplus, which sharpens the fall of power unit production efficiency.
Energy structure and carbon intensity effects reach their maximum of −12.64 Mt and −18.38 Mt, respectively.Due to promotion of renewable energy power generation and development of new energy resources after 2007, the share of renewable energy power generation increased; therefore, energy structure effect rose during 2009-2014.

CO 2 Emission Reduction Potential
3.5.1.Scenario Setting.Scenario analysis is one of the effective measures to estimate the CO 2 emission reduction potential.In this study, we also predict the CO 2 emissions of China's power sector during 2015-2030 based on equations ( 8)- (13).Power sector is the crucial sector for China to achieve its emission reduction targets.Therefore, it is necessary to understand the CO 2 emission reduction potential and then provide appropriate policy implications.In this study, two forecast scenarios are set to assess the CO 2 emissions and the ideal emission reduction scenario is developed to estimate the CO 2 emission reduction potential by setting the change rate of each variable at the target year.We take 2014 as the base year and 2030 as the target year.
We developed two forecast scenarios as follows.
(1) Business as Usual (BAU) Scenario.BAU scenario is established based on the historical development of each factor.All parameters chosen for BAU scenario are the average annual growth rate during 1990-2014.BAU scenario reflects the possible evolution trends of CO 2 emissions in China's power sector.The BAU scenario is the benchmark for setting other scenarios.
(2) Ideal Scenario.In the ideal scenario, CO 2 emissions in China's power sector are predicted to reach the possible minimum level by maximizing the negative driving factors and minimizing the positive driving factors.The energy intensity of China's power sector during 2005-2014 dropped significantly and is assumed to be the ideal decline rate.Growth rate of energy intensity during 2015-2030 is consistent with the average level during 2005-2014.In this scenario, according to the "12th Five-Year Plan" and "13th Five-Year Plan" of the power sector, power structure is in continuous optimization assuming that the installed capacity of hydro, nuclear, wind, and solar power reaches 330, 90, 180, and 100 million kW in 2020, respectively [18].The thermal power installed capacity is assumed to remain unchanged during 2010-2030 and other types of power are assumed to increase during 2020-2030 at the same growth rate during 2015-2020.We assume that the capital productivity improves constantly during 2015-2030 and reaches the highest level of 4838.06 (the level in 2005) by 2030.Consequently, the annual growth rate of capital productivity in ideal scenario is calculated according to the preceding assumption.The share of fossil energy consumption is assumed to reach 90% in the total energy consumption of China's power sector.CO 2 emission factor follows the level in BAU scenario.The corresponding growth rates of various variables under BAU scenario and ideal scenario are shown in Table 2.

CO 2 Emission
Forecast.Based on the hypothesis shown in Table 2, we calculate the effects of the driving factors BAU scenario and ideal scenario using ( 8)-( 12) and assess the CO 2 emissions of China's power sector during 2015-2030 using (13).Figure 9 shows the CO 2 emissions in China's power sector under BAU scenario and ideal scenario.In the BAU scenario, the CO 2 emissions are predicted to be 4132.75

CO 2 Emission Reduction Potential.
In order to estimate the future CO 2 emissions reduction potential of China's power sector, the ideal emission reduction scenario is set.The ideal emission reduction scenario means that CO 2 emissions of China's power sector transform from BAU scenario to the ideal scenario, which is the gap of CO 2 emissions between BAU scenario and ideal scenario.Figure 10   mitigation potential in China's power sector according to the LMDI method.

Conclusions and Policy Implications
During 1990-2014, CO 2 emissions from China's power sector showed a growing upward trend, increasing from 492.00 Mt to 3049.88 Mt.However, the growth course is shaky.By contrast, the CO 2 emission intensity experienced a downward trend, and the performance during 2005-2014 was remarkable, with a decline rate of 22.75%.Thus, power sector plays a dominant role in strengthening the national CO 2 emission increase.
Industrial scale effect (contribution degree: 123.97%) is the major contributor to CO 2 emission growth in China's power sector, whereas energy intensity effect (contribution degree: −20.01%) is the main factor leading to CO 2 emission decline.Capital productivity effect is another important factor that results in the decrease in CO 2 emissions (contribution degree: 2.87%).Both energy structure effect and emission factor effect are small and they display a varying trend among the time intervals.
There has been a significant reduction potential in CO 2 emission of China's power sector.The aggregate reduction potential of CO 2 emissions during 2015-2030 is 17973.86Mt. which is approximately equal to 6.88 times of the total emissions in 2010 and 5.89 times of the total emissions in 2014.

Policy Implications
(1) Technology-Oriented Mitigation Policies.(a) Significant attention should be paid to the promotion of renewable energy in power generation in China's power sector.In China, abundant renewable energy resource endowment and decreasing costs offer great potentials for developing renewable energy resources.Policymakers should not only increase R&D of renewable energy power generation, but also promote the use of renewable generation technology.Thus, large-scale renewable energy generation contributes to the adjustment of the power generation structure.
(b) Energy-saving is one of the most important ways to realize the low-carbon-oriented development of the power sector.The power sector should promote the development and utilization of energy-saving equipments, like highefficiency power generator, energy-saving transformer, and wires with low resistivity, and so forth.
(c) Other technologies that can directly reduce CO 2 emissions to atmosphere are also encouraged to be used in thermal power plants.CO 2 capture and storage technology is a preferred technology that allows conventional fuels for electricity generation to be used while achieving deep reductions in GHG (greenhouse gas) emissions.In addition, accelerating the development and use of innovative recycling CO 2 technology is helpful to reduce CO 2 emissions in power sector.
(d) Intelligent monitor, dispatching, and load prediction systems are also useful to optimize energy resource allocation and avoid energy waste and thus reduce CO 2 emissions.Based on the accurate real-time data and predicted data on power generation and consumption provided by the intelligent power system, power supplier can arrange power units to generate and guide power consumption reasonably.
(e) The energy efficiency in China's power sector can also be improved in several ways, including improving boiler efficiency, residual heat for preheating, blending coal combustion, and usage of high-quality coal.
(2) Power Demand Side Management.Power demand side management (DSM) is to adjust power load by means of technology, economy, energy-saving, energy institution, and so forth.DSM helps to release the tension between electricity supply and demand and reduces energy consumption and CO 2 emissions.In order to further exert the role of DSM, several suggestions provided are as follows.First, policymakers and power enterprises should further improve power price and incentive mechanism.More flexible power mechanisms including peak-valley price, tiered power price, and twopart tariff are needed to guide power consumer to achieve efficient, economical, and orderly power use.Government should take efficient actions to establish incentive mechanism and reasonably guide power consumption.Implementing the incentive mechanism such as tax and loan preferential policies helps to encourage power consumer to start energysaving renovation project.For residents, government can expand the scope of energy-saving home appliances subsidies and promote the use of energy-saving electric meter.Finally, the TV and newspaper ads plump the virtues and technology of energy-saving, which contributes to the energy-saving awareness improvement.
(3) Industrial Structure Adjustment.Government departments should take resolute measures to optimize industrial structure by closing or merging energy-intensive, highpollution and small steel mill, oil refineries, and chemical plants.Energy-intensive and high-pollution industries tend to be low value-added and have high energy and carbon intensity.Most small plants have no environmental protection measures and thus induce large amount of CO 2 emissions.Therefore, the government should strictly manage industrial sector production and firmly close high polluting small plants.Government should take effective measures to promote high-tech industry development in order to improve the power utilization efficiency and reduce CO 2 emissions generated by industrial production.
(4) Population Policy.Government should call on the people to control population growth and population birth policy should be adjusted to optimize the age structure.In addition, more attention should be paid to the western region and different population policies should be formulated in different regions to narrow the population gap because the western region has abundant resource endowment, such as renewable energy and natural gas, and would support more people.Urban consumptive expenditure per capita has an obvious positive impact on CO 2 due to urban residents' high consumptive level that is more energy-intensive.Therefore, strict energy efficiency standards should be promoted in urban settings.

Figure 3 :
Figure 3: Contribution of each driving factor to CO 2 emission change in China's power sector.

Figure 4 :Figure 5 :
Figure 4: Driving factors to CO 2 emission change by time series in China's power sector.

Figure 7 :
Figure 7: Division of time intervals of CO 2 emission growth in China's power sector.

Figure 9 :
Figure 9: CO 2 emissions in China's power sector under BAU scenario and ideal scenario.

Table 1 .
The energy resources considered in this study consist of nine kinds of energy: raw coal, Coke, crude oil, gasoline, kerosene, diesel oil, fuel oil, natural gas,

Table 1 :
Sector classification and abbreviations.
[17]electricity.Energy consumption is in the unit of million tons of standard coal equivalents (Mtce) and the conversion coefficients from physical to standard coal coefficient are derived from NDRC[17].The data of power generation and installed capacity are obtained from National Power Sector Statistics Bulletin (NPISB).Power generation is measured by million kWh and the installed capacity is in the unit of million kW.In addition, CO 2 emission factor and fraction of carbon dioxide by energy type are collected from IPCC (2006).
Especially after 2001, power market reform promoted the development of power sector and corresponding energy consumption and pollutant emissions including SO 2 and N  O  rocketed during 2002-2014.However, the relevant supervision measures and energy efficiency standards are imperfect during 2002-2010.Therefore, high-pollution, lower energy efficiency, and small power plants entered into power market.This explosive growth of power sector resulted in the significant increase in environmental effect.
3.1.Emissions in China's Power Sector3.1.1.Environment Effect of China's Power Sector.Using (1), we calculate the total emissions of power sector represented by IPAT index, which denotes the total environment effects of power sector development.The total impact of power sector increased continually from 220.49 to 1473.90, and the IPAT index increased steadily during 1990-2001 while it accelerated its growth from 2002.The IPAT index increased by 5.70 times during 1990-2014, denoting that power sector development leads to significant change of environmental condition due to energy consumption and CO 2 emissions.3.1.2.CO 2 Emissions inChina's Power Sector.In this study, CO 2 emissions consist of two parts: CO 2 emission scale and CO 2 emission intensity.CO 2 emissions scale means the total CO 2 emissions in China's power sector, while CO 2 shows that during 2000-2014 CO 2 emissions of China's power sector accounted for above 30%, and the share in national CO 2 emissions reached the maximum of 36.17% in 2007.During 2011-2014, the share of CO 2 emissions of China's power sector in total decreased continually.The sector with second largest CO 2 emissions is Coke, Refined Petroleum, and Nuclear Fuel sector (COK).CO 2 emissions of COK increased from 652.24 Mt in 2000 to 2484.90 Mt in 2014, and corresponding share in total CO 2 emissions increased steadily from 13.91% in 2000 to 18.01% in 2014.The third sector with large CO 2 emissions is ferrous metal sector (FMT) and the share in total CO 2 emissions remained between 11.57% and 14.53%.Following sectors with large CO 2 emissions are mining sector (MIN), chemicals sector (CHE), nonmetallic sector (NMT), other manufacturing industries (OMF), and transportation sector (TWP).Other sectors accounted for a small part of national CO 2 emissions.The share of household sector (HSH) in national CO 2 emissions 2 emission growth was 415.65 Mt during 1990-1997 and 235.10 Mt during 1997-2002, respectively, while it reached 1356.17Mt during 2002-2009 and 728.78 Mt during 2009-2014, respectively.Figure Mt in 2020 and 7294.08Mt in 2030, respectively.The aggregate CO 2 emissions during 2015-2030 reach 78746.59Mt which is nearly 30.13 times of the 2010 level and 25.82 times of the 2014 level.The CO 2 emissions in the ideal scenario are considerably lower than those in the BAU scenario.CO 2 emissions in the ideal scenario are 3541.38Mt in 2020 and 4560.10Mt in 2030 under the ideal scenario, respectively.The aggregate CO 2 emissions in China's power sector during 2015-2030 are
displays the CO 2 emission reduction potential in China's power sector during 2015-2030.There has been a significant CO 2 emission reduction potential in China's power sector.Under the ideal emission reduction scenario, CO 2 emissions reduced by 591.36 Mt in 2020 which accounts for 14.30% of the total CO 2 emissions of China's power sector in 2020 and by 2733.98 Mt in 2030 which accounts for 37.48% of the total CO 2 emissions in 2030, respectively.The accumulated CO 2 emission reduction during 2015-2030 in the ideal emission reduction scenario reaches 17973.86Mt, which is approximately equal to 6.88 times of the total emissions in 2010 and 5.89 times of the total emissions in 2014.