The development of China's biomass power industry under feed-in tariff and renewable portfolio standard: A system dynamics analysis

- The models are based on the affect of policies for investors' enthusiasm.
- System dynamics is used to analyze complex system of industry's development.
- The models are suitable for similar problems in different countries.
- The results reveal a long-term sustainable development of the industry.

Among the regulatory policies, feed-in tariffs (FIT) and renewable portfolio standards (RPS) are the most popular to promote the development of renewable energy power industry. This paper uses system dynamics (SD) to establish models of long-term development of China's biomass power industry under FIT and RPS schemes, and provides a case study by using scenario analysis method. The model, on the one hand, not only clearly shows the complex logical relationship between the factors but also reveals the process of coordination between the two policy tools in the development of the industry. On the other hand, it provides a reference for scholars to study similar problems in different countries, thereby facilitating an understanding of biomass power's long-term sustainable development pattern under FIT and RPS schemes, and helping to provide references for policy-making institutions. The results show that in the perfect competitive market, the implementation of RPS can promote long-term and rapid development of China's biomass power industry given the constraints and actions of the mechanisms of RPS quota proportion, the TGC valid period, and fines, compared with FIT. At the end of the paper, policy implications are offered as references for the government.