Sensitivity of the environmental costs of air pollution caused by SOx, NOx, and PM from power plants applied to the power mix configuration in South Korea

In the 6th Basic Plan for Long-Term Electricity Supply and Demand (6th BPE) for Korea, for the first time, the environmental costs of air pollution caused by oxides of sulfur (SOx), oxides of nitrogen (NOx), and particulate matters (PM) from power plants were estimated and included. However, several deficiencies in evaluating the environmental costs were found. In this study, (1) the validity of the environmental costs used in the 6th BPE was assessed, (2) a systematic approach was suggested and used to improve the environmental costs estimation, and (3) the sensitivity of the cost of generating electricity to the environmental costs by fuel type with the proposed approach was discussed. We found that the applied environmental costs used in the 6th BPE did not fully include the demographic characteristics of Korea. By applying more realistic parameter values, it was found that the newly estimated environmental cost was about 23 times higher than the cost estimated in the original 6th BPE for coal-fired power plants and about 1.5 times higher for liquefied natural gas (LNG)-fired power plants, suggesting that LNG-fired power plants are more economical if using more realistic environmental costs. Thus, it is critical to check the validity of parameter values when calculating environmental costs.