Cost-effectiveness analysis of local energy management based on urban-rural cooperation in China

The urban and rural areas usually illustrate distinguishing yet complementary features from natural, energy, economic and other aspects; thus, it is beneficial to consider them in a systematic and cooperative manner so as to develop a low-carbon society in the local area. In this study, the paths toward regional de-carbonization are indicated by conceptualizing systematic “urban-rural cooperation” that creates regional circulation of energy resources. As an illustrative example, an investigation has been conducted of assumed local energy systems for a model city. By developing a bottom-up energy system optimization model to include not only cost minimization but also emissions minimization, the proposed wide urban-rural energy systems are examined from both economic and environmental viewpoints. According to the simulation results, the energy system based on urban-rural mutual cooperation is the best option from both economic and environmental viewpoints, which results in cost-effective CO2 emissions reduction up to 50% below current level. In addition, by endowing an economic value to the reduced CO2 emissions through the local carbon price, the economic and environmental benefits for urban and rural areas can be shared and balanced between both sides.