Environ. Sci. Technol. 2011, 45, 380–385
Improvements in the Operation of
SO2 Scrubbers in China’s Coal
Power Plants
YUAN XU*
Woodrow Wilson School of Public and International Affairs,
Princeton University, Princeton, New Jersey 08544, United States
Received July 28, 2010. Revised manuscript received
November 18, 2010. Accepted November 19, 2010.
China has deployed the world’s largest fleet of sulfur dioxide
(SO2) scrubbers (flue gas desulfurization systems), and most of
them now appear to be operating properly. Although many
plant managers avoided using their SO2 scrubbers in the past,
recent evidence, based on a series of field interviews
conducted by the author, suggests that managers of coal
power plants now have incentives to operate their scrubbers
properly. China’s new policy incentives since 2007 appear well
designed to overcome the hurdle of high operation and
maintenance costs of SO2 scrubbers. Furthermore, it is now
far more likely that offenders will be caught and punished.
Continuous emission monitoring systems have played a key role
in this change of attitudes. Plant inspections have become
much more common, facilitated by a significant increase in the
number of inspectors and the fact that the 461,000-megawatt
SO2 scrubbers at the end of 2009 were located in only 503 coal
power plants, making frequent inspections little constrained
by the shortage of inspectors. Because SO2 is the precursor of
sulfate particles believed to cause significant cooling effects
on climate, China’s SO2 mitigation may make it more urgent to
control the world’s greenhouse gas emissions.
1. Introduction
China’s outdoor air pollution - with sulfate particles as a
significant component - causes serious damage to public
health (1). Because SO2 is the precursor of sulfate, mitigation
of SO2 emissions plays an important role in the control of air
pollution. Sulfate particles also have significant cooling effects
on climate though the magnitude is uncertain (2). SO2
mitigation will weaken the cooling effects and equivalently
warm the planet. China is the largest emitter of SO2, and its
share of the world’s emissions increased from 13% in 1990
to 18% in 2000 (3). Its mitigation efforts accordingly have
very important impacts, both regionally and globally. Power
generation is the largest source of SO2 emissions. China’s
official data reported that in 2005 25.5 million tons of SO2
were emitted and the share of coal power plants was about
half (4). A critical method to reduce SO2 emissions in coal
power plants is to install SO2 scrubbers (or flue gas desulfurization systems) that can often remove over 90% of the
SO2 in the flue gas. Between 2006 and 2009, China installed
SO2 scrubbers in 422,000-megawatt (MW) coal power plants,
and the share of the coal power capacity with SO2 scrubbers
* Corresponding author phone: (852)26096647; e-mail: yuanxu@
cuhk.edu.hk. Current address: Department of Geography and Resource
Management, the Chinese University of Hong Kong, Shatin, N.T., Hong
Kong.
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increased from 10% to 71% (5, 6). In comparison, the United
States accumulated 140,000 MW in more than three decades
until 2008, and 42% of the coal power capacity had SO2
scrubbers (7). There is little doubt that China possesses an
impressive array of SO2 scrubbers, as their existence has been
confirmed by formal verification procedures, the publication
of detailed data (8), independent checks (such as the author’s
site visits and a survey by Steinfeld et al. (9)), and the records
of foreign technology licensors. More importantly, official
data from the Ministry of Environmental Protection reported
that in 2008 SO2 scrubbers removed 78.7% of SO2 from
associated coal power plants (10), indicating that they were
largely operating as they were supposed to do.
China’s official claims of progress in the fight against air
pollution contrast sharply with the widespread perception
that the country has a poor record on environmental policy
implementation. A study has shown that many factories in
China were primarily concerned about minimizing operation
costs, and only operated their pollutant removal facilities
when an inspection was imminent (11). It would not be
surprising if the managers concerned adopted a similar
approach with their SO2 scrubbers.
Possible evidence of misreporting of SO2 emissions and
removal is also present. For example, official data reported
that SO2 emissions from the power sector in 2007 were 11.5
million tons (4), but an independent study estimated that
16.4 million tons were emitted in that year (12). In addition,
official data announced that in 2007 73.2% of SO2 was
removed from coal power plants that had SO2 scrubbers (10).
In Jiangsu province, however, a province that has a relatively
good track record on environmental protection, the rate was
found to be only 64.1% (13). However, the author’s visits to
China’s seven coal power plants in 2009 found that SO2
scrubbers were in most cases operating properly. In addition,
several provinces publish monthly data from continuous
emission monitoring systems (CEMSs) for individual SO2
scrubbers. The detailed data from this source enables a check
to be made against other official figures. In Jiangsu province,
a great majority of SO2 scrubbers after July 2007 were
operating for more than 90% of the time and were also
achieving SO2 removal efficiencies of over 90% (14).
Most SO2 scrubbers in China today do operate properly,
though this has by no means always been the case. The reason
is that coal power plant managers have been given strong
enough incentives to use their SO2 scrubbers as they were
meant to be used. In China, the decisions to install SO2
scrubbers and to operate them are largely separate. The
Chinese government has decreed that SO2 scrubbers should
be installed in specified coal power plants (15), and it is then
largely up to the managers to decide whether to operate
them or not. The willingness to install SO2 scrubbers does
not necessarily mean that the incentives are strong enough
for their proper operation. From another perspective, policy
incentives for the operation do not need to first overcome
the hurdle set up by the capital costs of installing SO2
scrubbers. In addition, China’s SO2 scrubbers vary greatly in
sizes, technology types, sulfur contents, costs of reagents,
and local environmental governance effectiveness. A significant variance should exist in their operation especially
across provinces.
Studies have shown that three conditions are favorable
to ensure compliance with environmental legislation: low
costs for compliance, high penalties for noncompliance, and
high probability of catching noncompliance (16-18). The
latter two conditions are complementary to each other. In
2000, Blackman and Harrington judged that in China, “both
10.1021/es1025678
 2011 American Chemical Society
Published on Web 12/02/2010
TABLE 1. Data on SO2 Scrubbers in China’s Seven Coal Power Plantsa
plant no.
region
new or
retrofit
SO2 scrubber
type
sulfur
content, %
Plant 1
Plant 2
Plant 3
Plant 4
Plant 5
Plant 6
Plant 7
Southwest
Southwest
Southwest
East
East
East
East
new
retrofit
retrofit
retrofit
new
retrofit
retrofit
wet
wet
wet
wet
wet
wet
(1): dry; (2): wet
3.0%
4.0%
3.5%
1.0%b
0.5%
1.0%
0.7-1.1%
operation and
maintenance
(O&M) costs,
$/MWh
profit margin
of electricity
price premium
generation, for desulfurized electricity, effluent discharge fee,c
$/MWh
$/MWh
$/MWh
3.7
∼ 14.6
2.2
∼ 4.1
1.8
2.2
<2.2
(1): > 3.7; (2): < 3.7
>0
2.2
2.2
2.2
2.2
3.7
.14.6
<7.3
2.0
2.8
2.5
0.7
0.3
0.7
0.4-0.7
a
The data were collected in the author’s interviews in June and July 2009. The costs and profit margin reflect their most
recent estimation generally for 2008. The original currency units were in Chinese RMB. In the conversion to U.S. dollars,
the exchange rate on December 31, 2008 is used: $1 ) 6.83 RMB. Upon the request of the interviewees, the names of coal
power plants are intentionally not shown. b No clear information on sulfur contents was disclosed in Plant 4. Comparing
with other plants in the eastern provinces, 1.0% is used here for later analysis. c The effluent discharge fee is calculated to
reflect the additional payment if shutting down SO2 scrubbers. The fee rate refers to the level of $0.092/kg SO2 (39). The
intermediate assumptions are as follows: sulfur retention rates in ash, 20%, as assumed in compiling China’s official data
(38); SO2 removal efficiencies of wet scrubbers, 95%, according to the author’s interviews; thermal efficiencies of electricity
generation, the standard levels at the corresponding unit scales (46).
the probability of getting caught for underreporting and the
penalty for doing so are quite low” (19). A 2009 IEA
(International Energy Agency) report claimed that the
operation of China’s SO2 scrubbers was problematic due to
high operation costs and ineffective environmental regulation
(20). Monitoring and site inspection are essential to catch
offenders but are subject to the constraints of high costs and
limited budgets (21). The problem is especially serious in
developing countries (19, 22). To enforce the SO2 allowance
trading scheme in the United States, the strategy was to install
CEMSs with “periodic quality control tests of monitoring
devices to maintain the accuracy of emissions data” (23, 24).
Large polluters can attract more attention. A study of the
U.S. steel industry found that large polluting plants attracted
more scrutiny than their smaller counterparts, regardless of
how good their compliance record was (25).
The operation of China’s SO2 scrubbers is a fresh research
focus. It was briefly addressed previously by the author using
official data (26). This paper provides a much deeper analysis
with new data and information collected in the author’s field
interviews. The proper operation of SO2 scrubbers is explained
as a rational decision of coal power plant managers.
The organization of the paper is as follows. The author’s
interviews are introduced in Section 2. Section 3 examines
specific problems in the operation of SO2 scrubbers. After
introducing the operation and maintenance costs of SO2
scrubbers, Section 4 analyzes two relevant policies on their
comparative strength. Section 5 discusses recent efforts on
monitoring and inspection to enhance the probability of
catching nonoperation. Section 6 provides discussion for
future pollutant mitigation.
2. Data
In June and July 2009, I visited seven Chinese coal power
plants in four provinces: three in two southwestern provinces
that were poor and generally burned high-sulfur coal and
four in two eastern provinces that were wealthy and generally
burned low-to-medium-sulfur coal. The major quantitative
data are presented in Table 1. They belonged to six different
state-owned corporations and had a total of 15 SO2 scrubbers.
Two coal power plants (Plants 1 and 5) had SO2 scrubbers
installed together with power generation units, while the
others were retrofits. The total capacity was 4240 MW, and
the unit capacities were 125 MW, 135 MW, 200 MW, 220 MW,
300 MW, and 600 MW, respectively. One SO2 scrubber in
Plant 7 applied a dry-type technology and all others used
wet-type technology, with limestone as the absorption
reagent. Except in Plant 2, where my interviewee was not
cooperative, I interviewed relevant managers or engineers
and visited the plants’ SO2 scrubbers and CEMSs.
In order to reduce the interviewees’ concerns about
potentially negative consequences and to minimize biases
in sampling coal power plants, I intentionally avoided using
government officials relevant to environmental protection
as referrals. The interviewees had no obligation to accept my
request of interviews and guide me through the site visits.
The interview in Plant 2 ended in just a few minutes because
the interviewee was concerned about my doing the research
in a U.S. university, while those in the other six plants were
smoother and lasted more than two hours. I am reasonably
confident that the scenes I witnessed in the six plants gave
a fair reflection of how these plants operated on a daily basis.
From March to May 2010, I interviewed two significant
American companies that licensed SO2 scrubber technologies
to China, and several Chinese SO2 scrubber companies, to
get a better idea of the quality of SO2 scrubbers from the
perspectives of the people who designed and built them.
The capital costs of SO2 scrubbers are much lower in China
than in the United States, and there is therefore some doubt
whether China’s scrubbers have the technical capability to
operate properly.
3. Factors Discouraging the Proper Operation of SO2
Scrubbers
The managers of coal power plants have strong incentives
to avoid the costs of operation and maintenance (O&M).
Data from Jiangsu province show that from 2006 to June
2007, the self-reported operation rates (the percent of time
that a SO2 scrubber is in operation alongside the corresponding power generation unit) from coal power plants
were significantly higher than the values that were later
confirmed, likely through other relevant data such as
limestone consumption, gypsum production, and electricity
consumption (respectively over 90% and around 60%)
(14, 27, 28). The discrepancy reflects the likely magnitude of
misreporting. This section discusses several prominent
problems that emerged from the author’s interviews and the
literature. Until very recently (as recently as 2007 in the case
of Jiangsu province), these problems prevented the proper
operation of SO2 scrubbers and also caused very significant
uncertainty in estimating SO2 emissions from coal power
plants.
Insufficient Incentives and Compromised Implementation. A survey of China’s inspection authorities and polluting
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firms found that fines for noncompliance were often not
high enough to deter potential offenders (29). The initial SO2
effluent discharge fee a decade ago was about 0.20 RMB/kg
($0.029/kg, the exchange rate on December 31, 2008, $1 )
6.83 RMB, is used universally in this paper) in most provinces
and lower than the marginal abatement costs in China’s large
plants (30, 31). Polluting firms may simply pay to pollute.
When facing a penalty, the first reaction of polluting firms
was to negotiate with environmental protection bureaus or
ask for the interference of local governments (29), which
compromised the penalty.
The Underreporting of SO2 Emissions and the Quality
of SO2 Scrubbers. Coal power plants underreport SO2
emissions to pay a lower effluent discharge fee and to be
seen as complying with regulations. In 2007, 98% of coal
consumed in China’s power plants was raw coal (32). Coal
power plants are allowed to pick out coal stones from received
raw coal to calculate actual coal consumption. In interviews,
the author found that coal stones were sometimes overreported. This factor could have led to a 1-2% underestimation of SO2 emissions. Furthermore, China’s coal power plants
usually have to use different coals with sulfur contents that
can vary significantly. The instability of coal supply was
confirmed by Steinfeld et al. (9). It made the underreporting
of sulfur contents harder to detect.
Interviews in China’s SO2 scrubber companies found that
many early scrubbers (for example, before 2005) had serious
quality problems. In order to reach designed SO2 removal
efficiencies, besides the replacement of malfunctioning
equipment, a few SO2 scrubbers even had to have their very
expensive absorber towers changed. The main reason for
the faults in the SO2 scrubbers was that they were designed
on the basis of underreported sulfur contents. In China’s
first public and high-profile statement to penalize the
abnormal operation of SO2 scrubbers, instability and bad
quality were particularly pointed out, and three power plants
were found to use coal with much higher sulfur than the
designed levels (33).
At the design stage of SO2 scrubbers, if the managers of
coal power plants had been underreporting sulfur contents
in the past, they would continue to do so to conceal their
guilt. Furthermore, some managers did not plan to operate
their SO2 scrubbers initially and were not concerned about
their quality. They installed the SO2 scrubbers purely in order
to comply with the government’s requirements and to qualify
for a subsidy for generating desulfurized electricity. The
managers wanted to minimize capital costs through underreporting sulfur contents. When inspections are known in
advance, reaching the required SO2 removal efficiencies is
not a problem because coal power plants often keep some
low-sulfur coal in reserve on-site.
The Illegal Use of Bypass Ducts. Most SO2 scrubbers have
bypass ducts to allow the flue gas to exit without going
through the SO2 scrubber systems. The purpose is to enable
electricity generation when SO2 scrubbers have minor
problems and need to be shut down temporarily. In a recent
policy, coal power plants are not penalized provided that
their SO2 scrubbers are properly operating for at least 90%
of the time (34). However, bypass ducts also provide
opportunities to avoid the operation of SO2 scrubbers when
they function normally. Six coal power plants were penalized
for illegally using bypass ducts and leaving some flue gas
untreated in 2007 and 2008 (33, 35).
Inaccurate Data from CEMSs. CEMSs could greatly
enhance environmental monitoring capacity. China had 60
SO2 scrubbers at the end of 2004 (5), while a general survey
in 2004 found that about 400 CEMSs had been installed in
180 coal power plants (36). The author’s site visits and
Steinfeld et al. also found that CEMSs were being widely
used (9). As far as cost is concerned, there is little reason for
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coal power plants to resist the installation of CEMSs. Two
CEMSs in Plant 3 in Table 1 cost around $132,000, only 0.5%
of the capital costs of the plant’s SO2 scrubbers.
However, CEMSs may not report credible and reliable
data. One concern is over the quality of the equipment used.
CEMSs cost much more in the United States: according to
a cost model from the U.S. EPA, it generally requires more
than half a million dollars for one set (37). The 2004 general
survey found that only 20% of the CEMSs in China were
functioning normally (36), local environmental protection
bureaus generally refused to accept data from CEMSs, and
only one was recognized as a credible data source for the
purposes of levying the SO2 effluent discharge fee (36).
At present, CEMSs have been officially accepted as data
sources after their online connection with provincial environmental protection bureaus. However, the author’s interviewees still said that they did not fully trust data from
CEMSs. The locations of the sensors could affect the readings
of CEMSs, and data reporting could also be manipulated. In
2008, three coal power plants were caught illegally setting up
ceilings of outlet SO2 concentrations that could be reported
(35).
Cheating and Colluding with Inspectors. Data from
CEMSs are compared quarterly with direct measurements
to verify accuracy (38). A survey in China found that multiple
inspections per annum tend to deter violation, no matter
which government level inspectors are from (29). However,
the effectiveness of site inspections could be constrained.
According to the author’s interviews, many plants were able
to raise the removal efficiency of their SO2 scrubbers from
zero to the designed level in half an hour and significantly
more quickly if from an intermediate level. Some plants
therefore kept their scrubbers either turned off or on low
power and put them in full operation only when an inspection
was imminent, enabling them to keep costs down while also
passing the inspection. Even if abnormal operation was
caught, a solution could be to collude with inspectors through
bribes.
4. China’s Policy Incentives for the Operation of SO2
Scrubbers
The proper operation of SO2 scrubbers demands strong
enough incentives to overcome the hurdle of the high O&M
costs. This section analyzes China’s policies to assess the
decision making when SO2 scrubbers do and do not function
normally. The decision is restricted between full operation
and nonoperation because operation with low SO2 removal
efficiencies only avoids part of the O&M costs but has to bear
roughly the same penalty as nonoperation.
To the author’s knowledge, China has not published
official data on the O&M costs, and previous studies have
also shed little light on this issue. In the United States, the
average O&M costs in 2008 were $1.55/MWh (7). These figures
can hardly be extrapolated for China because of the great
differences in the capital costs of SO2 scrubbers, labor costs,
and other items.
The author’s interviews collected relevant data from six
coal power plants, as presented in Table 1. The O&M costs
varied from $1.8 to 4.1/MWh, all above the average in the
United States. Further information is necessary to quantify
the difference. Sulfur contents were the most influential
factor: Plants 1 and 3 burned coals with 3%∼4% sulfur
content, and their O&M costs were roughly twice as high as
those in Plants 4, 5, 6, and 7, which burned coals with 1%
sulfur content or less. In this section, the O&M costs are used
as the average marginal costs of operating SO2 scrubbers. In
generating electricity, several coal power plants that the
author visited had profit margins from not much above zero
TABLE 2. Decision Scenarios for the Managers of Coal Power Plantsa
scenario
SO2
scrubbers
functioning
SO2
scrubbers
operating
electricity
generation
(1)
yes
yes
yes
(2)
yes
no
yes
(3)
(4)
no
no
no
no
yes
no
net revenue of a coal power plant
profit margin
profit margin + O&M costs - C% × (price premium +
discharge fee + penalty)
profit margin + O&M costs - C% × (price premium +
discharge fee + penalty)
0
a
C% is the actual probability of catching the nonoperation of SO2 scrubbers. The proper operation of SO2 scrubbers
when they function requires that the net revenue in scenario (1) is greater than that in scenario (2). The corresponding
condition can be calculated as C% >(O&M costs)/(discharge fee + price premium + penalty). When SO2 scrubbers do not
function, the discontinuation of electricity generation becomes a rational decision when the net revenue in scenario (4) is
greater than that in scenario (3), or C% >(profit margin + O&M costs)/(discharge fee + price premium + penalty). Because
profit margins are generally positive, it is accordingly easier to push for the proper operation of SO2 scrubbers when they
function than to ask coal power plants to discontinue electricity generation when they do not. In order to encourage coal
power plants to fix malfunctioning SO2 scrubbers as soon as possible, the rational decision when SO2 scrubbers function
should generate greater net revenue than that with malfunctioning SO2 scrubbers. The condition is fulfilled when C%
>(O&M costs)/(discharge fee + price premium + penalty).
to significantly over $14.6/MWh (including the O&M costs
of SO2 scrubbers and the price premium for desulfurized
electricity).
Decision Making When SO2 Scrubbers Function Normally. In July 2005, China’s SO2 effluent discharge fee was
raised from $0.031/kg in 2003 to $0.092/kg (39). However, as
converted to $/MWh in Table 1, it was still too low to
overcome the hurdle of the much higher O&M costs. Another
increase was scheduled in 2007 to reach $0.18/kg in three
years (40), but the exact schedule varied from province to
province. In Jiangsu province, the higher rate has been in
effect since July 2007 (41), but in Henan province, the lower
rate was still being applied as recently as the first quarter of
2010 (42). With the higher rate, coal power plants burning
high-sulfur coals will find operating SO2 scrubbers cheaper
than paying the effluent discharge fee (Plants 1 and 3 in
Table 1). However, for others (Plants 4, 5, 6, and 7) when
facing only this policy, the rational decision is to pay the fee.
Another policy was introduced in 2004. If new coal power
plants came online together with SO2 scrubbers, the desulfurized electricity could enjoy a price premium of $2.2/
MWh (15). In June 2006, the policy extended to cover all SO2
scrubbers, including retrofitted ones (15). Some coal power
plants were awarded higher price premiums, such as Plant
7 in Table 1. The price premium and the effluent discharge
fee together were a little higher than the O&M costs (Table
1), but the small difference indicates that the proper operation
would be a rational decision only when most nonoperation
cases were caught.
In 2007, a harsh penalty measure was associated with the
price premium for the first time. If the operation rate is lower
than 80% and SO2 scrubbers are still not operating, a penalty
of $11.0/MWh will be issued (34). The required minimum
probability of catching nonoperation became much lower
to induce the proper operation of SO2 scrubbers. For Plant
3 in Table 1 burning high-sulfur coal, corresponding to the
effluent discharge fee of $0.092/kg SO2, a risk-neutral manager
would decide to operate SO2 scrubbers properly if the
probability of catching nonoperation exceeded 26% (see Table
2 for the calculation formula). For Plants 4 and 5 burning
low-to-medium-sulfur coals, the minimum probability was
about one-seventh.
Furthermore, additional penalties were introduced on the
managers of coal power plants. In China, almost all coal
power plants are owned by the state. The nonoperation of
SO2 scrubbers could increase profit and benefit the managers’
career and salary. However, according to formal regulations
(34) and the author’s interviews, cheating and nonoperation
could lead to the removal of the managers. They have to
calculate the risk for themselves.
Decision Making When SO2 Scrubbers Do Not Function
Normally. SO2 scrubbers occasionally have to stop operating
due to accidents, malfunctions, or other reasons. While they
are out of action, SO2 emissions can be controlled either by
minimizing the sulfur content of coal or by shutting down
electricity generation. China issues no penalty as long as the
operation rate is above 90%, a mild penalty of $2.2/MWh if
the rate is between 80% and 90%, and a harsh penalty of
$11.0/MWh if the rate is under 80% (34). Because it is
expensive to restart electricity generation, the O&M costs of
SO2 scrubbers may not be critical in the decision making
when SO2 scrubbers can get fixed soon. This subsection
focuses on the decision making when problems have to take
much time to fix - for example several weeks - and the penalty
of $11.0/MWh is applied.
The economic incentives should make it a rational
decision to discontinue electricity generation for many coal
power plant managers. Electricity generation without operating SO2 scrubbers earns a profit margin and avoids the
O&M costs of SO2 scrubbers, but if the nonoperation of SO2
scrubbers is caught, coal power plants need to return the
price premium and pay the effluent discharge fee as well as
the penalty. Many coal power plants will continue generating
electricity as long as the probability of catching the nonoperation of SO2 scrubbers is low enough (see Table 2 for the
specific calculation). For coal power plants with large profit
margins (such as Plant 5 in Table 1), electricity generation
should continue even when nonoperation cannot be hidden
at all. However, when the author visited Plant 5, electricity
generation in one system had been discontinued for several
weeks due to its malfunctioning SO2 scrubber. Personal
penalties on the managers could have played a role.
Furthermore, coal power plants are assigned a quota for their
total SO2 emissions (43). If nonoperation is caught, the quota
quickly will be used up.
Even if the decision is to continue electricity generation,
a high enough probability of detection is still necessary to
encourage coal power plants to fix malfunctioning SO2
scrubbers as soon as possible (see Table 2 for the specific
calculation). If the actual probability is not expected to reach
this level, there will be little concern about the quality of SO2
scrubbers, as in the early years.
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5. The Probability of Catching the Nonoperation of SO2
Scrubbers
China has made several prominent improvements in monitoring and site inspection to enhance the probability of
catching the nonoperation of SO2 scrubbers. The number of
government employees at all levels engaged in environmental
monitoring has increased from 46,984 in 2005 to 51,753 in
2008 (4). More importantly, CEMSs have become critical to
monitor the operation of SO2 scrubbers especially since 2007
(34). Six plants (all in Table 1 except Plant 2) allowed the
author to read the computer screens of their CEMSs. The
values of SO2 concentrations changed continuously, and
different data were generally consistent.
In recent years many CEMSs and SO2 scrubbers have been
inspected once or twice a month. Because CEMSs transmit
data online and in real time, inspections often follow
abnormal data reporting. Coal power plants are informed in
advance of some inspections, but in many other cases
inspections are unannounced. Inspectors have the right to
enter coal power plants without being delayed. In the plants
that the author visited, inspection vehicles generally needed
just a few minutes to drive from the gates to the sites where
the SO2 scrubbers were installed. China is actively building
up its site inspection capacity. The number of government
inspectors at all levels has increased steadily in recent years,
from 50,040 in 2005 to 59,477 in 2008 (4). China has focused
on monitoring and inspection in its efforts to build capacity.
During the period 2006-2008, the two functions accounted
for 85% of government personnel growth for environmental
protection (4).
Because of the concern about their data accuracy and
reliability, as discovered in the author’s interviews, CEMSs
are not the only data source to track the operation of SO2
scrubbers. Other relevant data are collected, including
operation and maintenance records, load factors of electricity
generation, sulfur contents of coal, the consumption of
limestone and other reagents, electricity consumption, the
handling of products from SO2 scrubbers, the opening and
closure of bypass dampers, and records of accidents and
responses (34, 44). SO2 concentration in the inlet flue gas
corresponds to the sulfur contents within a fairly predictable
range. The load factors of electricity generation decide the
flow rate of the flue gas and can check direct measurement
with CEMSs. The factors together determine the sulfur load
to a SO2 scrubber system. For wet scrubbers using limestone
as the reagent, the molar ratio between CaCO3 and SO2 is
normally quite stable at 1.02-1.05 (45). Then the sulfur load
will decide the consumption of limestone and the production
of gypsum. The managers of coal power plants are asked to
keep the receipts of limestone purchases, and cheating on
receipts is considered financial fraud with harsh penalties
on those responsible. Electricity is another important input
to operate SO2 scrubbers. Because all data should be
consistent with each other, it becomes more difficult to cheat
with the methods described in Section 3.
China’s limited resources for monitoring and inspection
are enough to have an intensive focus on SO2 scrubbers.
Particularly, the 461,000 MW SO2 scrubbers (1264 systems)
at the end of 2009 were located in only 503 coal power plants
and the largest 300 had a total capacity share of 82% (5).
Government personnel are sufficient to follow these 503
plants closely and conduct inspections frequently.
The problem of collusion appears under control. Data
from CEMSs are sent to more than one agency, including
environmental protection bureaus and electric grid corporations. Authorities at China’s four government levels - central,
provincial, prefectural, and county - all inspect SO2 scrubbers.
The multiplicity of inspection authorities effectively diminishes the opportunities of collusion. In addition, the pressure
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to achieve the 10% reduction goal of SO2 emissions in the
11th Five-Year Plan reduces incentives to collude.
In order to better implement the incentives, responsible
government agencies are specified: electric grid corporations
are in charge of paying the price premium in time; provincial
environmental protection bureaus collect effluent discharge
fees; provincial price agencies are responsible to recover
unjustified price premium according to actual operation rates
(34). Seven coal power plants in 2008 and five in 2009 were
penalized for cheating or nonoperation with the $11.0/MWh
penalty applied (33, 35).
6. Discussion
At least three points are worth noting for future pollutant
mitigation. First, though economic-incentive policies played
a critical role to induce the proper operation of SO2 scrubbers,
command-and-control policies were also essential. The
Chinese government decided when and in which coal power
plants SO2 scrubbers should be installed. Coal power plants
without SO2 scrubbers do not enjoy the price premium for
desulfurized electricity but do not face the associated penalty
either. If the installation of SO2 scrubbers can be decided by
the managers of coal power plants, most will not find it
economically attractive.
Second, the penalty of $11.0/MWh for nonoperation was
successfully enacted probably because the price premium
for desulfurized electricity was essentially a subsidy. In other
words, the consent from coal power corporations might have
been “purchased” with the price premium.
Third, although China has limited resources for environmental monitoring and inspection, it is not difficult to
continue to target inspections on SO2 scrubbers, because
only a few hundred coal power plants in the whole of China
are involved. However, the further mitigation of SO2 and
other pollutants will have to deal with numerous small
polluting sources with much wider diversity than SO2
scrubbers. The challenges in enacting proper policies and
catching noncompliance will be more daunting.
This paper’s explanation of the proper operation should
not be seen as exclusive or complete. The official data may
still overestimate the actual performance of SO2 scrubbers,
though probably not as much as they did a few years ago.
The cooperation among involved government agencies is
another important factor. The threat to remove the managers
of coal power plants would barely have any impact if the
plants were not state-owned. Rich coastal provinces should
better operate SO2 scrubbers because of their better environmental policy enforcement and lower O&M costs due to
lower sulfur contents. One concern is about the sustainability
of the achievement partly because China’s insufficient rule
of law means that there is no certainty that existing policies
will continue to be enforced.
China’s history and culture of environmental law is less
developed to press coal power plants to operate SO2 scrubbers
properly. China’s court system plays only a marginal role in
environmental policy enforcement. The proper operation of
SO2 scrubbers represents a great advance in China’s environmental protection efforts and could lead to further
improvement. However, because SO2 is the precursor of
sulfate particles that cause significant cooling effects on
climate, the world may need to accelerate the negotiation of
an international climate treaty to accommodate China’s
faster-than-expected reduction of SO2 emissions together
with the associated cooling effects.
Acknowledgments
The author would like to thank Robert Socolow, Robert
Williams, Yiguang Ju, Catherine Peters, Denise Mauzerall,
Jonas Nahm, Chi-Jen Yang, Jing Song, David Wilmshurst,
the anonymous reviewers, and the editor for commenting
on the contents of this paper. Funding was provided by
Woodrow Wilson School, Princeton Environmental Institute
and Department of East Asian Studies at Princeton University,
and the Industrial Performance Center at Massachusetts
Institute of Technology.
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