A system dynamics based model for coal investment

Coal is the dominating energy source in China. Although the supply and demand of coal has kept equilibrium along with China's continuous and steady economic development in recent years, the sustainable production ability has been seriously decreasing. In this paper, a system dynamics model is developed taking the investment in coal industry, available reserves, mine construction and coal supply capability into account. With the model, the impact of the investment in state-owned mines and geological prospecting is investigated. And the optimal investment size is put forward.