Advanced stochastic optimization modeling of the water ... · Background Model description Numerical experiments Conclusion 2) CO 2 Emission 0 500000 1000000 1500000 2000000 2500000

China University of Mining and Technology, Beijing

Center for Resources and Environmental Policy Research

Advanced stochastic optimization modeling of the water-energy-food

nexus for robust energy and agricultural development: Coal mining

industry in Shanxi

province, China

Xiangyang Xu1;Junlian Gao1;Cuiqing Sun1;Guiying Cao2;

Yermoliev Yurii2; Ermolieva Tatiana2;Elena Rovenskaya2;

1. Center for Resources and Environmental Policy Research

China University of Mining and Technology, Beijing

2. IIASA(International Institute for System Analysis), Austria

June 1st ,2016

Background Model description Numerical experiments Conclusion

Coal is and will continue as key source of energy in China

0.0

20.0

40.0

60.0

80.0

100.0

19

78

19

85

19

91

19

93

19

95

19

97

19

99

20

01

20

03

20

05

20

07

20

09

20

11

20

13

%

the share of coal consuption in China

2020: 63%

2040: 55%

Source : China Statistic Yearbook ;U.S. Energy Information Administration (EIA)


The challenges facing by coal industry in China

• Air pollution

• Greenhouse gas emissions

• Land damage

• Water shortage


1) Air pollution

Relationship between the coal consumption and the days of haze

62 % of PM2.5; 93 % of SO2; 70 % of NOx

Source: Report Coal Utilization's Contribution to China's Air Pollution


2) CO2 Emission

0

500000

1000000

1500000

2000000

2500000

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

19

50

19

55

19

60

19

65

19

70

19

75

19

80

19

85

19

90

19

95

20

00

20

05

20

10

mill

ion

to

ns

ton

per capita in total

Total and per capita CO2 emissions from 1950 to 2010 in China 80% of CO2 emissions from all energy use in China

Source : Oak Ridge National Laboratory , International Energy Agency


3) Land damage

• Overlap areas between the coal reserve and farmland account for more than 40% of the total farmland area in China

• Damage farmland have reached 700,000 hectares

• Occupied farmland have reached 15,000 hectares

Source: Hu Z., et al. (2014)


4) Water shortage

Geographical mismatch between water availability and coal industry Source : China Water Risk


What is the future for coal industry in China? Resort to technology ? Every coins have two sides

CCSDesulfurization

technologyDenitration

technologyCoal washing Filling back

Land

damage

Water

consumption

Air pollutionCO2

emission

-+

+ +

-- -

++

-


A sustainable future for coal?


Network of coal industry system


Framework of the model

Output

Water resource

The optimal coal production

The portfolio of technology

Water consummation

and water storage

The optimal crop production and crop structure

Land use/food production Wheat Corn Millet Sorghum

Oats Buckwheat Bean Potato

Water supply

Coal Conversion Power

generation

Gasification

Coke

Chemical

Others

Coal Processing

Coal Wash

Dry Wash

Others

Coal Mining

Long wall face

Backfill mining

Opencast

Land subsidence

Land reclamation

Water supply

Crop structure and Irrigation technology

Water-dependent coal technology

Goal function

the production cost of a unit (i.e., ton) of coal of type in location

the transportation cost of a unit of coal of type from location to location

the conversion costs of a unit of coal of type by technology in location

the costs associated with production of a unit of the agricultural commodity

in location

the transportation cost of a unit of the agricultural commodity from location

to location

the distance form location to location

,, , , ,

Min CP CT CC AP AT

ij ijmt ijm ijmt jm imt ilmt kj kjm kjl kjm jmx y

i j k m t

c x c x d c x c y c y d

CP

ijC i jCT

ijmCi j m

CC

imtCi j m

AP

kjC k

j

AT

kjmC k j

m

jmd j m



, , , , ,

P d c

ij imlt imt ijmt kj kjm j

i m t i j t k m

w x w x w y w

, , , , ,

(1 )kj kjm ijmt j j ij ijmt ij j

k m i m t i m t

l y x r l l x g L

,

d d

ijmt ijmt m

i, j t

x D

kjm km

j

y D

,

c

ijmt ij

m t

x C

, ,

,O

ijmt j

i m t

x C m j , ,

,I

ijmt m

i j t

x C m j

2 2, ,

, ,

SO d SO C

imt ijmt m

i j t

e x ENO , ,

, ,

x xd NO C

imt ijmt m

i j t

e x E

2, 2,

, ,

CO d CO C

imt ijmt m

i j t

e x E

Constraints

1) Water

2) Farmland

3) Demand for coal conversion product

4) Demand for food

5) Production capacity

6) Transportation capacity

7) Air pollution

8) CO2


Constraints

9) Rate of coal process

10) Demand of coal

11) Nonnegative constrains

' '

, , ,

(1 )o jmt j ijmt

m t i m t

x x

, , ,

ijmt

i j t m

x I D

0ijmtx 0kjmy

Analysis of the uncertainties

The source of uncertainties

1)Nature

Climate change

2)Policy

Industry policy/ Environment policy

3)Market

Coal market/ Alternative energy market

4)The limitations of cognitive

Technical parameter


Deterministic TO Stochastic

Solutions from Deterministic model

Solutions from

Stochastic model

Integrated two-stage stochastic model

• Policy recommendations

can lead to sunk costs,

irreversibility if other

scenario occurs.

• Policy recommendations

is a robust solution

under certain security

level.

• scenarios -by-

scenarios analysis

produces set of

degenerated different

solutions

• One roboust soluton

for all water avaiable

scenarios


• Uncertainty of water supply

• Uncertainty of water demand

• Systemic Risks:

Shortages of coal production

Food shortages

• When will they happen– dry or wet years ?


Water security level • The goal function includes the security(risk) factors

• Optimal condition for is as below:

0))()((Pr,,,

' tmki

jjkjmjkijmtijtj

inv

j ZwWyWxWobCFjZ

j

inv

j

tmki

jjkjmjkijmtijt CZwWyWxWob /))()((Pr,,,

j

On the left - the probability of water shortage in the location

On the right - the ratio of investment per addition water storage to the cost/loss

associated with water shortage.

The robust solution , from the stochastic model ensures the certain water

security level .

*

ijmtx *

kjmy

j

inv

jC /

])([Pr~}])(,0[max{ ZWWyWxobZWWyWxE

- security level

),,( zyxF



Application scope of the model

1) Scale of the model

• Spatial : country, province, region, coal base

• Temporal: static

2) Boundaries of the geographical unit

• Political

• Physical

3) Precision of the forecast model

• Dependent on data

4) Application area

• Scenarios’ analysis

• Policy simulation


Case study area: Shanxi

• Arid and semi-arid areas

Per capita water resource in Shanxi is only around 300 m3, which is equal to 1/7 of the per capita water resource of China, 1/25 of the per capita water resource of the world.

• Largest coal basic reserve in China

90.842 billion tons, accounting 40% of the total coal reserves in China, With a coal-bearing area of 62,000 km2, which accounts for 40% of the whole province area. Out of 119 counties in Shanxi, 94 counties have coal resource distribution.

• Land damage

Land subsidence caused by coal mining and occupied by the waste of coal mining has reached 68,000 hectare and the speed of those areas is increasing by 5,000 hectare per year, of which, 40% is the farmland

Scenario analysis in STO model

• Scenario of coal demand (unit: tons)

• Scenario of crop demand(unit: tons)

• 20 years water historical data for all 11 cities-to conclude probability distribution of water availability

• Different energy/food security combination in STO model

• water security level - 90%

1(-20%) 2(-10%) 3(2012) 4(10%) 5(20%)

740340000 822600000 914000000 1005400000 1105940000

A(-20%) B(-10%) C(2012) D(10%) E(20%)

11699089 12998988 14443320 15887652 17476417


Result of STO model

water security 90%

Water storage is more sensitive to the food demand.

The interaction on land use between food production and coal mining is not strong.


Optimal Results in scenario Year 2012

Crop production Coal production


Compare with the actual situation

0

2

4

6

8

10

12

Wat

er

Vo

lum

e(1

00

mill

ion

m3

)

Water for Crop

Actual Model

Total water consumption for Crop: Model: 31.21 Actual: 39.92

22% less


Compare with the actual situation

Taiyuan, Datong,Changzhi, Jincheng, Xinzhou and Lvliang can produce more coal.

Lvliang is not suitable for crop production due to water resource situation.


Different Energy/food security

The coal production in Shanix is more efficient in other province.

The more efficient solution for crop demand in shanxi is to import food from other province.

Value of Stochastic Solution

The solution stochastic model is better than that from the deterministic model.

The value of STO-goal function with deterministic solution

The value of STO-goal function with robust

solution Perc. difference

Total Cost 2.82425E+12 2.41044E+12 17.2%

The Value of Stochastic Solution (Model), VSS, estimates the importance of incorporating uncertainties and applying the stochastic model It compares the value of stochastic goal function with deterministic and with robust solutions: ),,( *** DetDetDet zyxF ~),,( *** RobRobRob zyxF


• The model stresses the importance of water storages for

sustainable development of coal production in water scarce

regions.

• For coal-rich area, food production could not be high level. The

policy makers may arrange an agreement on food imports with

other food producer.

• To improve the food security, advanced irrigation system should

be applied.

• The robust from solution of the stochastic model is better than

the solution from the deterministic model in terms of VSS.



Potential extensions

• Static to dynamic model

• Constraints extension

• Policy red line to Physical red line

• Link to hydrological model , land use model and

agriculture model

• Database improvement(GIS)


Thank you for your attention!

Documents

Advanced stochastic optimization modeling of the water ... · Background Model description Numerical experiments Conclusion 2) CO 2 Emission 0 500000 1000000 1500000 2000000 2500000