Electricity generation may create high levels of pollution, but its consumption is completely clean. Long-distance electricity transfers make the allocation of environmental externalities caused by electricity generation unfair at the regional level. This paper provides a generalized approach that can be used to evaluate air pollution and health loss embodied in electricity transfers. Impact pathway approach is combined with a network approach to evaluate embodied direct health loss and a sophisticated evaluation of air pollution diffusion is implemented to assess indirect environmental impacts between regions. Using China's inter-provincial power transmission as an example, this paper also reveals various air pollutant and health loss transfer patterns among the nation's provinces. The results emphasize the importance of characterizing the embodied environmental effects in electricity transfer through health losses rather than air pollution emissions. The inter-regional indirect impacts due to the diffusion of pollutants must be considered when examining the embodied health losses, which is even higher than the direct impact on the local. Several central regions in China, adjacent to the major electricity-export provinces, do not export a large amount of electricity, yet their health losses have increased significantly due to nationwide power transfers. The direct external health costs of electricity generation in China's major power-exporting provinces are relatively low. However, when indirect impacts are considered, external costs in the central and northern regions increase significantly. Therefore, the regional environmental benefits of shifting electricity generation to resource-rich remote areas are greatly reduced for many pairs of provinces.
Keywords: Economic valuation; Electricity transfer; Environment; GAINS; Health loss.
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