Valuation Study

View Study Details

Value of Mortality and Morbidity


Medium: Air

Country: China

Analytical Framework(s): Economic Analysis

Study Date: 2003

Publication Date: 2004

Major Result(s)

Resource/Environmental Good CNY
Mortality/Infant Mortality (WTP)1 256,347.00
Outpatient Visits (OPV) (COI)2 53.77
Emergency Room Visits (ERV) (Adjusted COI) 89.75
Respiratory Hospital Admission (RHA) (Adjusted COI) 2,375.83
Work Day Loss (WDL) (COI) 11.05
Acute Respiratory Symptoms (children/adults) (COI) 3.91
Chronic Respiratory Symptoms (COI) 32,315.20
Asthma Attacks (AA) (WTP) 5.72

Study Note: This study provides information on the additional "ancillary" benefits that China would experience by reducing emissions of the greenhouse gas carbon dioxide. It investigates a number of options for mitigating CO2 emissions in the power and industrial sectors of Guiyang City. It calculates the impact these options would have on the city's overall air pollution and effects these changes in air quality would have on the health improvements and looks at the overall cost and benefit that each of the carbon dioxide reduction technologies would bring to society as a whole. It finds that a number of technologies would not only help address the problem of global warming but improve the quality of the city's air and the health of its people. Over time, these would pay themselves in terms of reduced mortality and illness levels. The study recommends that the government should support and legislate for such "no regrets" carbon dioxide reduction initiatives. It also recommends that similar studies be done in other cities to identify options suitable for those cities' conditions.

Study Details

Reference: Jing Cao. 2004. Options for Mitigating Greenhouse Gas Emissions in Guiyang, China: A Cost-Ancillary Benefit Analysis. EEPSEA Research Report, No. 2004-RR2.

Summary: This paper argues that it is possible to simultaneously achieve reductions in both Greenhouse Gas (GHG) emissions as well as local air pollutants such as sulfur dioxide (SO2) and particulate matters in China. The benefits of such reductions are the so-called "ancillary benefits" of GHG mitigation, which are often ignored in current policy-making frameworks. This paper estimates the ancillary benefits of various GHG mitigation technology options related to coal consumption, such as the advanced electricity generation technologies of Integrated Gasification Combined Cycle (IGCC), Atmospheric Fluidized Bed Combustion (AFBC), Pressurized Fluidized Bed Combustion (PFBC), Oil Fired Combined Cycle (OILCC) and Gas Turbine Combined Cycle (GASCC). This paper also estimates the benefits of other mitigation options such as coal pretreatment, the renovation of existing old boiler systems and the application of new, efficient boiler systems in the industrial sector of Guiyang, China. To assess these GHG mitigation technology options, this paper applies a bottom-up or damage function approach to estimate the associated ancillary benefits. It then applies a new methodology - Cost-Ancillary Benefit Analysis (CABA) - towards policy decision-making for local governments. The calculations of various GHG mitigation technology options in Guiyang suggest that these measures will bring about substantial ancillary benefits in both the electricity and the industrial sectors. Using best-guess dose-response functions and unit values for estimating health impact endpoints, the ancillary health benefits are estimated at 89-278 USD/tC (US dollars per ton carbon). Using CABA to rank the selected GHG mitigation technology options, the results show that AFBC is preferable in terms of maximizing net present values compared with other electricity generation options in the electricity sector when the discount rate is less than 15%. In the industrial sector, however, whether governments adopt the coal pretreatment and boiler renovation option or apply new and efficient boiler systems would depend on the sensitivity of the discount rate. A crude CABA estimates that when the discount rate is less than 8%, the coal pretreatment and boiler renovation option is better, and when discount rate is greater than 8%, applying new and efficient boiler systems is preferable. The CABA results also prove that "no regrets" GHG mitigation options do exist for both electricity generation technologies and industrial boiler improvement. Therefore the latter part of this paper discusses China's current climate change-related energy policies and institutional frameworks. Also, barriers and opportunities for China's implementation of GHG mitigation options are analyzed and recommendations are proposed for future policy formulation and decision-making taking into account global climate changes and local environmental benefits in China.

Site Characteristics: As the second largest emitter of greenhouse gas (GHG) and the most populous country in the world, China currently accounts for about 13% of global carbon dioxide emissions, mostly because of its high reliance on coal consumption and sharply increasing demand for automobiles (IEA 2000). This figure is expected to rise over future decades. With an average 7% Gross Domestic Product (GDP) growth rate, the energy system plays a critical role in economic development to sustain increasing energy demands with rapid economic growth. Although as a developing and non-Annex I country, China is not bound to any GHG emission or carbon abatement limits during the first control period (from 2008 to 2012) of the Kyoto Protocol (KP), China announced at the World Summit on Sustainable Development held in Johannesburg, South Africa on 3 September, 2002, that it has completed the domestic procedures for the approval of the Kyoto Protocol, and will play an active role in mitigating GHG emissions.

Comments: This paper used a bottom-up approach - an approach focusing on individual processes from the micro-level perspective - to estimate the ancillary benefits of various GHG mitigation technology options in local Guiyang. Then, a Cost-Ancillary Benefit Analysis (CABA) for the selected GHG mitigation options is conducted. The results show that the ancillary benefits associated with the aforementioned GHG mitigation options are very significant in both the electricity sector and the industrial sector. Consequently, GHG mitigation can be done at low costs if ancillary benefits are considered. Under certain circumstances, GHG mitigation activities can even bring positive net benefits, or "no regrets". Finally, this paper investigates China's current energy policies and institutions, analyzes the barriers and opportunities associated with GHG mitigation activities, and proposes recommendations for promoting GHG mitigation activities in China.