Resource Library / Journal Article / A novel framework for quantifying techno-economic and social impacts of stranded coal value-chains: Case study of a decarbonising Indian electricity system
A novel framework for quantifying techno-economic and social impacts of stranded coal value-chains: Case study of a decarbonising Indian electricity system
Journal Article
1 December 2026
Abstract
Transitioning from fossil fuel-based to renewable energy (RE) generation is critical for meeting climate goals but entails major social and economic challenges across the coal–thermal value chain, including job losses, asset stranding, and revenue disruptions. Existing research largely focuses on technical, financial, or environmental aspects, with little attention to these social and economic costs, and no established way to integrate them into formal energy system models. This study proposes a novel and mathematically tractable framework that classifies social and economic impacts as ‘capital stranding’ per MW of prematurely retired coal capacity and ‘operational stranding’ per kWh of avoided thermal generation. Such classification is designed to enable future inclusion of these costs directly into energy planning models (typically large-scale optimisation models), filling a key gap in current approaches. We apply the framework to Karnataka’s electricity system for 2020, a particularly relevant case as the state has aggressively integrated RE into its grid. While our findings are Karnataka-specific, the framework is adaptable and can be extended to other regions with appropriate datasets, which forms the basis of our ongoing research. By embedding socio-economic concerns into technical planning, this work provides policymakers with tools to design just and inclusive transition strategies that minimize disruptions while advancing sustainability.
Summary
To meet climate goals, it is essential that India shifts from coal power to renewable energy. However, the consequences extend far beyond power plants. Coal mining, transportation, and electricity generation form an interconnected value chain, supporting millions of livelihoods, substantial investments, and government revenues. Yet the impacts across this value chain remain inadequately understood and rarely find their way into energy planning models.
This study proposes a framework to identify and quantify the social and economic effects of transitioning away from coal, distinguishing between two types of impacts:
- Operational stranding: What happens when coal plants generate less electricity?
- Capital stranding: What happens when coal plants retire before the end of their useful lives?
By expressing these impacts in measurable units (INR/kWh and INR/MW respectively), the framework allows direct incorporation into electricity system planning models. The authors applied this approach to Karnataka’s electricity system in 2020. Their findings point to revenue disruptions, under-utilised infrastructure, and potential workforce impacts extending well beyond power plants, including coal-dependent regions in other states.
The framework offers policymakers a way to examine different transition pathways in phasing out coal, identify who may be most affected, and plan interventions such as worker re-skilling, asset repurposing, and regional economic diversification.
Presented At/Published In
Energy and Climate Change
Country
India
Associated Resources
Citation
Abhishek Das, Balachandra Patil, A novel framework for quantifying techno-economic and social impacts of stranded coal value-chains: Case study of a decarbonising Indian electricity system, Energy and Climate Change, Volume 7, 2026, 100280, ISSN 2666-2787, https://doi.org/10.1016/j.egycc.2026.100280.