Strategies of Two-Level Green Technology Investments for Coal Supply Chain under Different Dominant Modes

Round 1

Reviewer 1 Report

Please see my detailed comments in the attached file.

Comments for author File: Comments.pdf

Author Response

Response to Reviewer 1

Thank you for your suggestion about my article, I am so appreciated and I revised them based on your comments. Maybe I did not describe it clearly. Therefore, I list all the comments below one by one.   

Major comments:

1. A major flaw is that authors have not mentioned which model is best and which of their hypothesis proves right according to their research.

Response 1: We are so appreciating your opinion, and we explained that the better model in this article, especially in the last sentence of abstract, in line21-23, the discussion part and conclusion part, the result showed the manufacturer-led mode will perform better based on the calculation.

We hypothesis that the clean coal input and the dominate mode will affect the carbon reduction process. I used the result of clean coal investment multiple the transferred coefficient number of clean coals in coal enterprise and the carbon reduction quantity in manufacturer as the standard of optimal mode, k for the transferred coefficient number of clean coals, in which kept them consistent. Because this article studies the coal supply chain, we hypothesis that the better dominate mode will achieve more carbon reduction, so that it will be realize sustainability development. In another side, we encourage the wide-spread of clean coal. The result consists with our hypothesis which the clean coal utilization is benefit for developing green ecology and lower carbon reduction. Based on your opinion, I rewrite these parts which relate to the model selection, and I need to point out that the dominate mode means which one is the leader through the supply chain, so they may appear alternately in the article. For example, in the last part of abstract; and in the discussion part, the proposition 8, I highlighted the result and conclusions.

 

2. The introduction is lack of sufficient background information; it is strongly recommended to add a recent literature survey about different types of fuels. Research gaps should be highlighted and future applications of this study should be added.

Response 2: We appreciated you have comments on my article carefully, I noticed that the introduction actually lacks of some background information, specially I add some information about other fossil and renewable energy, and differentiate other energy products from coal, I highlighted it in introduction part. In line 34-36, I mentioned that the renewable energy does not have sufficient resource for sustainable living, therefore the coal still be the main energy resource for people’s living. In the same time, we emphasize the clean coal, which is a new type of coal product that takes ordinary coal as a raw material, the technology transforms it from a coal product that emits harmful substances by burning to a new coal product that is cleaner and has significantly lower carbon emissions.

The research gaps and future applications of this study already be added in the end of introduction, and I highlighted this with yellow color. Depends on the high cost of clean coal, the investment for it deserved to pay attention, and the optimal carbon reduction under different dominate mode need to be discussed. 

 

3. The literature review is not strong enough to provide research gaps.

Response 3: We are grateful that your comments, we already readjust the literature review which desired to described the research gaps clearly, in line 137-143, line 175-178, line230-247. Especially about the carbon emission process and related information. In conclusion, we separated them into three parts, first paragraph is about optimal strategy of the coal supply chain. In our article, we study the coal supply chain optimal strategy with clean coal upstream and manufacturer downstream under different dominate mode; Second paragraph is about low-carbon subsidy, because there is a responsibility to reduce emissions in the coal supply chain, the enterprises always have financing needs for expensive reduction funds or seek for subsidy to alleviate financial constraints. In our article, we hypothesis that the production cost is enough for both enterprises, but the government supply carbon reduction subsidy and clean coal subsidy. Under different dominate mode, the subsidy whether encourage carbon reduction or not.  

 

Specific comments:

1. Authors should mention the future scope of this study and possible gaps in the abstract.

Response 1: We are grateful that your comments, and we conclude the future scope in the end of abstract, in line 23-25. This article only relies on the government subsidy without other financial support, in next stage, we could study on the other financial support, for example the bank loan and private lending.

 

2. Is there no alternative way instead of coal usage? Also, mention if there is any other fuel that can be used? If not, then why?

Response 2: There are alternative ways to instead of coal usage, the new clean energy source, for example, the solar power, wind power, tidal power and so on. But in China, coal still be the most important power resource, and based on some literatures, China is rich in coal (Wang, C., Jin, H.,et.al,(2019), Exergy and Energy Analysis of Coal Gasification in Supercritical Water with External Recycle System. International Journal of Chemical Reactor Engineering,), new clean energy is not enough for fully satisfied the people’s living, in line 43-36.

 

3. Page 1, line 13-14: Authors said, we examine optimal clean coal technology inputs in coal enterprise and carbon reduction quantity in manufacturer under the modes of coal-enterprise-led and manufacturer-led respectively. We obtain some interesting results. How authors obtain the results mention some of the methods in the abstract.

Response 3: We are grateful that you gave me lots of meaningful comments, in the abstract, I did not mention about the method of research before. I revised the structure of abstract, and I added the description of method which we used. In this article, we study the article by Stackelberg game theory model, in line 15.

 

4. Introduction: Background is weak, no information is provided about the CO2 emission from fossil fuels (Coal etc.) the major contributor in global warming, therefore, the authors are advised to read Page 2 of 2 and add CO2 emission levels from the following studies: International Journal of Chemical Reactor Engineering, 2019; 17(11). International Journal of Chemical Reactor Engineering, 2019; 17(4).

Response 4: We are thankful that your comments on my article, we enhanced background information about the CO2 emission from coal the major contributor in global warming, and we searched the studies you suggested. We added some information about gasification of coal which result in carbon emission, it pointed out that incomplete gasification can produce H2-rich has and porous carbon. But gasification of coal to produce H2 was more efficient with the catalyst, in line 35-38.

  

5. Page 1, line 35-36: The green and environmental renewable energy movement does not have sufficient resources for sustainable living. Why it is so? Write some of the reasons for a better understanding of the readers.

Response 5: We appreciated your comments, we got the information from the reference we cited, the authors described in the abstract that green energy does not have sufficient resource for sustainable living. We reviewed the description which not clearly, so we add more information to help for better understand, in line 40-50. The reason could be listed as below, first one is China is rich in coal, and coal is the mainly energy resource for people’s living; Second one is renewable energy is a new product compared to traditional energy sources, and is still being explored and discovered, and is not yet stable; Third one is renewable energy is a synthetic product that requires the help of some episodic or less common natural phenomena, such as wind power, the requirement for wind are hard to established, it must be located in some place with high quality wind resources, meanwhile the transportation also be a big problem for it.

 

6. Page 2, line 80-86: There is no need to write this paragraph. Authors are advised to submerge section 3 and 4 into one under one heading.

Response 6: We appreciated your comments, and we already delete the last paragraph in section 1. And the section 3 and 4, we discussed these parts, because the hypotheses is basement, and the section 4 and section 5 are all discussed based on the section 3, they are mainly talked about the calculated process and result description, so we think the section 3 and section 4 should be kept.

 

7. Page 3, line 111-113: With the development of online shopping, scholars have compared reduction results under different distribution channels. Ji and colleagues found that the online channel is profitable when the consumers’ low carbon preference matches certain conditions. How online shopping affects carbon reduction, write the reason for it?

Response 7: We appreciate your comments, and based on your comments, we reviewed the reference before, we did not explain it clearly. We cited this Ji’s research for showing the carbon reduction preference affects acceptance of the cap-and-trade model around the supply chain, and online channel encourage the firm’s profit. Therefore, we modified this sentence, in line 121-123.  

 

8. Page 4, line 169: In section 2.3 authors talk about cap-and-trade model, what is the cap-and-trade model and what it stands for? Elaborate it clearly

Response 8: We appreciate your comments, we elaborate the cap-and-trade mode in Page 4, section 2.3, line 183-187, and we highlighted it in yellow color.

 

9. Authors are advised to revise the captions of figures, especially figure 4 and 5 which are not complete, for better understanding of the readers.

Response 9: We are sorry for the careless, and thanks for your comments, we already resized all the pictures, and made them clearly.

 

10. In the discussion, section authors should mention which model for carbon reduction is best and why?

Response 10: We are appreciated your comments, and based on your comments, we already revised our discussion, in Proposition 8, we highlighted the conclusion about optimal dominate mode, in line 517-518.

 

11. More recent research about types of fuels, CO2 reduction methods and sustainable energy development is suggested to be added to make the background and discussion more strong: Sustainability, 2020; 12(12):5186. Journal of CO2 Utilization, 2020; 40:101193. Energy, 2020; 209:118444. Fuel, 2021;289:119800. Journal of Analytical and Applied Pyrolysis, 2020;150:104897. ACS Sustainable Chemistry & Engineering, 2020; 8, 12877-12890.

Response 11: We are appreciating your comments, and we searched the references you recommended, and read them clearly. As the reference, we added the information which related to our article. You can notice them in line 12, line 35-37, line 51-52, line 66-67.    

 

12. Authors have also not mentioned which of their hypothesis proves right or what result they got from their research for the hypothesis they made?

Response 12: Thanks for your sincerely comments, this comment we already replied before, as you said, this is very important and major revision advise, so I replied it in the head of reply.

 

13. When coal is burned except carbon dioxide which other harmful gases can emit from upstream factories and how they can be tackled?

Response 13: We appreciated your comments, we thought this revision made our article become more clearly and completely. Refer to the question you asked, the other gases emit from upstream also need to be tackled due to the pollution problem. There are many ways to deal with them, for example, the gasification I mentioned in line 35-37. I added the information about other gases in introduction background, and I highlighted them mainly in Page1, paragraph 1.

 

14. Is the government not providing any subsidy to coal enterprisers and manufacturers before? If they are providing any subsidy already then how much percentage they should more.

Response 14: We are appreciating your comments, and we really sorry about the subsidy percentage, because in this article, we focus on the subsidy influence on carbon reduction without studying the specific percentage, but we already have the plan to study them in next stage, and we really thank for the meaningful comments, it also indicates that our next stage research plan is important.

 

15. References: The authors are advised to revise references, including the latest references. Please see some suggestions in the comments for the ‘introduction’ section.

Response 15: Thanks for your comments, based on your comments, we already revised the literature review and introduction, and we also pointed out in specific comments.

Author Response File: Author Response.pdf

Reviewer 2 Report

With the help of the Stackelberg game model theory, this manuscript has developed a coal-supply chain model consisted of one coal enterprise adopting clean coal technology and one manufacturer employing carbon reduction technology. Applying this model, the authors explored optimal strategies under coal enterprise-led and manufacture-led modes respectively, as well as conducted sensitivity analysis on two model parameters, i.e. the carbon reduction preference, clean coal conversion factor and subsidy levels. In general, the paper has provided us some insightful viewpoints on the traditional energy supply chain management and the distribution of governmental subsidies between the up-stream and down-stream. However, since all findings of this study entirely depend on the developed model, the insufficient and inappropriate description of the model at certain places compromises the plausibility of the paper.

1. In the introduction section, the authors tentatively introduce the concept of new economy, whose features, however, are not fully reflected in the developed model.
2. The literature review is, to some extent, too general and discusses some fundamental concepts, which are not directly relevant to the main topic of this paper. In my opinion, the discussion on the evolution and application of Stackelberg game theory, the setting of agents within the coal supply chain are more meaningful.
3. The definitions of the coal enterprise and the manufacturer are not consistent. As defined in L. 71-72, “the coal enterprise produces coal for the manufacturer, such as for generating electric power or firing for heat energy”, the income of the coal enterprise comes from the selling of clean coal, while of the manufacturer from the selling of electricity and heat. However, according to eq. (1) and (6), they are referred to as the gap between wholesale price of coal and the production cost of clean coal, and the gap between clean coal price and the wholesale price of coal, respectively. How to understand this?
4. More illustrations are needed to help readers understand the setting principles of the model. In the current shape, it is difficult to follow the logic line. Take assumption 1 as an example: q is the quantity of coal ordered from the coal enterprise. Ec is the input level of the clean coal technology, which should be a monetary value. Em is the carbon reduction quantity, which measures the quantity of carbon. So here is the question: how the parameters with different units can be directly added up? What are the units of the coefficients? What are their exact meanings in the reality?    
5. Can the authors please give a more detailed explanation on why they choose a quadratic function to represent the production costs of the coal enterprise and the manufacturer? And why are the production costs only relevant to the clean coal technology inputs and carbon reduction quantity? As we know, in reality, besides investment on technology, other capital costs, operational costs and labor costs also matter a lot.
6. Some notations are problematic. For example, c can present both the coal enterprise and the production cost of clean coal. And in L. 376, Cts does not exist.
7. The language and format errors (see Fig. 2-5) should be corrected widely.

Author Response

Response to Reviewer 2

Major comments:

With the help of the Stackelberg game model theory, this manuscript has developed a coal-supply chain model consisted of one coal enterprise adopting clean coal technology and one manufacturer employing carbon reduction technology. Applying this model, the authors explored optimal strategies under coal enterprise-led and manufacture-led modes respectively, as well as conducted sensitivity analysis on two model parameters, i.e. the carbon reduction preference, clean coal conversion factor and subsidy levels. In general, the paper has provided us some insightful viewpoints on the traditional energy supply chain management and the distribution of governmental subsidies between the up-stream and down-stream. However, since all findings of this study entirely depend on the developed model, the insufficient and inappropriate description of the model at certain places compromises the plausibility of the paper.

Response: In the first, we appreciated your comments about our article, we read this comments letter carefully, and we revised our article depends on your opinion. Especially the model we used; the comments pointed out our model description influence the paper’s plausible. Therefore, we revised the description of our function, include section 3 and the head of section 4, also we connected the result with the description of our function. In line 301-304, the high clean coal cost and carbon reduction cost influence the calculation result. Line 305-308, it described the coal enterprise profit and manufacturer profit, include cost and subsidy, without any other financial support. The line 341-349 illustrated the function components. We explained them clearly in specific parts clearly below.

 

1、In the introduction section, the authors tentatively introduce the concept of new economy, whose features, however, are not fully reflected in the developed model.

Response to 1: We are so appreciating your comments, as you said the new company’s features, the high cost and low profit, are not reflected in the developed model. Actually, we described the high cost in our function,  are expressed clean coal technology cost and carbon reduction cost respectively, and in Assumption 3, stand for coefficient number for clean coal and manufacturer, they are infinitely large. For the better understand of article, we added some description about them, in Line 302-304.

 

2、The literature review is, to some extent, too general and discusses some fundamental concepts, which are not directly relevant to the main topic of this paper. In my opinion, the discussion on the evolution and application of Stackelberg game theory, the setting of agents within the coal supply chain are more meaningful.

Response to 2: We are so appreciating your comments, based your comments, we reviewed our literature carefully. We advised the literature review, and added some information to support this paper, in line 125-127, it described the cap-and-trade could be accepted easily under high reduction preference. Line 132-141, line 208-217. And we must to declared that the literature review is based our content, we agreed your opinion, the topic may too general, but in different part, we all discussed the specific literature for supporting the article. In conclusion, our innovation concluded that the optimal strategy for coal supply chain with government subsidy under different dominate mode. We also discussed the Stackelberg game theory in line 136-140, and we revised them clearly and compared them with our study in line 145-147.    

 

3、The definitions of the coal enterprise and the manufacturer are not consistent. As defined in L. 71-72, “the coal enterprise produces coal for the manufacturer, such as for generating electric power or firing for heat energy”, the income of the coal enterprise comes from the selling of clean coal, while of the manufacturer from the selling of electricity and heat. However, according to eq. (1) and (6), they are referred to as the gap between wholesale price of coal and the production cost of clean coal, and the gap between clean coal price and the wholesale price of coal, respectively. How to understand this?

Response to 3: We are so appreciating your comments, we are sorry for your confusion due to our unclearly description. Firstly, the selling of clean coal actually be the income of coal enterprise, the gap between wholesale price and production cost in eq.(1) is the income of coal enterprise, w means whole price, and the c indicate the production cost, we assumed that q is the ordered quantity from manufacturer in line 267, and the ordered quantity we already described in line 288, so the coal enterprise profit equal to the gap between wholesale price and cost. In another hand, the income become the gap between clean coal price and wholesale price due to our assumption the ordered quantity of clean coal is equal to the quantity the manufacturer trade, so the clean coal price minus wholesale price is the profit the manufacturer gets. It is our fault that we did not explained it clearly, we added explanations in line 270.

 

4、More illustrations are needed to help readers understand the setting principles of the model. In the current shape, it is difficult to follow the logic line. Take assumption 1 as an example: q is the quantity of coal ordered from the coal enterprise. Ec is the input level of the clean coal technology, which should be a monetary value. Em is the carbon reduction quantity, which measures the quantity of carbon. So here is the question: how the parameters with different units can be directly added up? What are the units of the coefficients? What are their exact meanings in the reality?    

Response to 4: We are so appreciating your comments, what you said about e_c and e_m is right, so the unit actually is different, and it could not be added up directly. So, we use parameter k to unify the unit, in Assumption 1, , we used k to multiple e_c, the k means the quantity of clean coal conversion parameter, it indicates the amount of heat energy that can be converted per unit amount of clean coal, the unit has been unified. This is very important to us, so we re-declared it clearly in article, in line 275-277.

 

5、Can the authors please give a more detailed explanation on why they choose a quadratic function to represent the production costs of the coal enterprise and the manufacturer? And why are the production costs only relevant to the clean coal technology inputs and carbon reduction quantity? As we know, in reality, besides investment on technology, other capital costs, operational costs and labor costs also matter a lot.

Response to 5: We are so appreciating your comments, this comment is very meaningful for us. At first, we choose quadratic function to represent the production costs of the coal enterprise and the manufacturer due to the technological innovation functions, we described the function in Assumption 3. It is our fault that we did not make ourselves clearly, so I gave more explanation about it in line 308. The carbon reduction and the clean coal technology are all new technology in our life, and they are helpful our sustainability development. We are study on the economy, but in professional way, the technology is expensive to the enterprise, the more quantity of clean coal input, the more you paid, and it showing a no-liner relationship. So, the enterprise could take the green technology utilization as an optional choice. However, with the increase of clean coal technology input and carbon reduction quantity, the carbon reduction cost increased further, c_tc/c_tm represent reduction parameter, in line 305. In second, the production cost only relevant to the clean coal technology inputs and carbon reduction quantity in our article, because the clean coal technology cost and the carbon reduction cost are much higher than other cost expenses, so other costs merely equal to 0 in comparison, and in our introduction part, we also mentioned that the green technology cost is fairly high in other study, in line 74-75.

 

 

6、Some notations are problematic. For example, c can present both the coal enterprise and the production cost of clean coal. And in L. 376, Cts does not exist.

Response to 6: We are so appreciating your comments, in our article, the single alphabet c means production cost, if the c list as the subscript, such as e_c, it refers to the coal enterprise. And in L.402 (because the revision mark, the line number may have changed), c_ts is wrong, the notation should be c_tc. 

 

7、The language and format errors (see Fig. 2-5) should be corrected widely.

Response to 7: Thank you for your comments, we reviewed our article and revised the format errors, the Figure 2-5 have been resized.

Reviewer 3 Report

This article deals with a coal supply chain with a coal enterprise and a manufacturer, where the coal enterprise invests in clean coal technology, and the manufacturer invests in carbon reduction technology. This analysis considers the government offers subsidies for the investments of clean coal technology and carbon reduction technology.
The core of the work is examination optimal clean coal technology inputs in coal enterprise and carbon reduction quantity in manufacturer under the modes of coal-enterprise-led and manufacturer led respectively.
At the end of the work, the important conclusions of this study are summarized and also other research possibilities in this area are presented.
The results of the article contribute to the environmental protection and support for the development of environmentally friendly businesses.

The article has good professional quality, but formal processing needs to be improved.

Comments:

• the formal arrangement of formulas in the text needs to be improved,
• the visual quality of Figures 2, ... Figures 7 must be improved (mainly visibility of the axis description).

Author Response

Comments:

• the formal arrangement of formulas in the text needs to be improved,
• the visual quality of Figures 2, ... Figures 7 must be improved (mainly visibility of the axis description).

 

Response:

Firstly, I am appreciating your opinion, and I reviewed my article carefully based on your opinion, and revised them. Therefore, I listed the modification traces.

1、I already check the article format, and also the appendix part.

2、I already rearrange the Figure 2-8, and made them clearly.

Author Response File: Author Response.pdf

Round 2

Reviewer 1 Report

The authors have responsed well to those proposed questions by reviewers and carefully revised the whole paper according to the suggestions of reviewers step by step. Therefore, the quality of this paper has elevated greatly.

Author Response

Response to Reviewer 1

 

Comments and Suggestions for Authors

The authors have responded well to those proposed questions by reviewers and carefully revised the whole paper according to the suggestions of reviewers’ step by step. Therefore, the quality of this paper has elevated greatly.

Response 1: I am appreciating your comments and compliment, based on the English language and style, I reviewed the whole article and rechecked the spell and language. The last but not the least, your comments and suggestion really help us to improve our paper, and we also learnt lots of writing skills and publication notification. Therefore, we really grateful having your comments and making our paper better.

 

Author Response File: Author Response.pdf

Reviewer 2 Report

Thanks for authors’ responses. It is appreciated to see some of my questions have been properly answered. To further improve the soundness of the paper, I suggest authors to focus on the left questions which are not fully solved in the response.

1. Authors have explained that the income of the manufacturer is calculated as the gap between the retail price and the wholesale price of clean coal. My question is that since the products of manufacturer are set as heat energy and power in this paper, why don’t the authors take the selling of those products as the revenue of the manufacture? How to properly understand the exact meaning of “the quantity of clean coal have been traded in manufacture” and “energy power” in the assumption “… the ordered quantity of clean coal is same with the quantity of clean coal have been traded in manufacture, or the ordered clean coal have been completely converted to energy power” in L.271-273?
2. Concerning the significance of k, authors claim that “the amount of heat energy that can be converted per unit amount of clean coal”. I have two following questions: (1) Why does k only consider heat energy here? Where is the power?

(2) k is set to be converted from "per unit amount of clean coal”. However in assumption 1, e_c represents the clean coal technology input instead of the clean coal itself. That is to say, the units of k and e_c are inconsistent. How can they multiply together?

 

3. To justify the employment of quadratic function, authors argue that the production cost and technology cost have a non-linear relationship. I suggest authors to cite several literatures to support this argument. Additionally, the idea of “because the clean coal technology cost and the carbon reduction cost are much higher than other cost expenses, so other costs merely equal to 0 in comparison” should definitely be incorporated to the text, since it is a very important piece of information for the setting of the formula.

 

4. More generally, I took assumption 3 as an example to point out the problems widely existed in model description in the current form. As I pointed out before, since all findings of this study entirely depend on the developed model, sufficient and appropriate description of the model is of great importance. As readers, we would like to know more about the thoughts behind the devise of the model, especially the key information on the design of the model. Therefore, I hope authors could thoroughly go through the manuscript and provide necessary information at each needed place instead of only focusing on solving my example.

Author Response

<Please see the attachment>

Response to Reviewer 2

 

Comments and Suggestions for Authors

Thanks for authors’ responses. It is appreciated to see some of my questions have been properly answered. To further improve the soundness of the paper, I suggest authors to focus on the left questions which are not fully solved in the response.

1. Authors have explained that the income of the manufacturer is calculated as the gap between the retail price and the wholesale price of clean coal. My question is that since the products of manufacturer are set as heat energy and power in this paper, why don’t the authors take the selling of those products as the revenue of the manufacture? How to properly understand the exact meaning of “the quantity of clean coal has been traded in manufacture” and “energy power” in the assumption “… the ordered quantity of clean coal is same with the quantity of clean coal have been traded in manufacture, or the ordered clean coal have been completely converted to energy power” in L.271-273?

Response to 1: We are appreciating your comments, and we are sorry for the unproperly responses, it may confuse you. Therefore, you said “…why don’t the authors take the selling of those products as the revenue of the manufacture…”. Because in our article, we assumed that the object is a two-stage supply chain, and the revenue of the manufacturer equal to the gap between the retail price and the wholesale price of clean coal in the downstream industry. In China, the heat energy companies have been taken as extremely competitive businesses, the electricity resources produced by coal enterprise can be fully consumed by the population or stored. In the same way, the ordered quantity of clean coal means the manufacturer ordered from coal enterprise, we assumed that the ordered quantity of clean coal has been used up in manufacturer. And we deleted “the quantity of clean coal has been traded in manufacturer” in case of misunderstanding. The energy power usually indicates that the output from manufacturing process, clean coal as a fuel can release heat or other energy supply during combustion. The prior saying “energy power” has been replaces by energy supply. And we add some description about the quantity, in line 272-274.

 

2(1). Concerning the significance of k, authors claim that “the amount of heat energy that can be converted per unit amount of clean coal”. I have two following questions: (1) Why does k only consider heat energy here? Where is the power?

Response to 2 (1): Firstly, we are appreciating your comments. The parameter k is a significant parameter in our article, it could be explained as the amount of heat energy or other energy supply that per unit clean coal can release through combustion, or how efficiently it can be burned. The k is not only considered heat energy, we actually indicate the downstream enterprise product which include heat energy and other energy supply. In additional, the tools used in the burning of clean coal also could influence the burning efficiency. We decide to replace energy power with energy supply. In line 276-277.

 

2(2). k is set to be converted from "per unit amount of clean coal”. However, in assumption 1, e_c represents the clean coal technology input instead of the clean coal itself. That is to say, the units of k and e_c are inconsistent. How can they multiply together?

Response to 2 (2): We appreciating your comments, our unproperly description may cause your confusion. e_c actually expressed as clean coal technology investment, the k represents per unit clean coal converted into heat energy or other energy supply, or it could be described as the efficiency of clean coal due to burning. And the key point is that with the clean coal technology input increased, the efficiency of clean coal will be higher. Therefore, k multiple e_c could be explained as the quantity of energy-saving by clean coal utilization. In line 278-279. So, the assumption solves the problem about the clean coal input did affected the carbon reduction in downstream enterprise, the cleaner the coal is, the less carbon emission the manufacturer is.

 

3. To justify the employment of quadratic function, authors argue that the production cost and technology cost have a non-linear relationship. I suggest authors to cite several literatures to support this argument. Additionally, the idea of “because the clean coal technology cost and the carbon reduction cost are much higher than other cost expenses, so other costs merely equal to 0 in comparison” should definitely be incorporated to the text, since it is a very important piece of information for the setting of the formula.

Response to 3: Thanks for your comments sincerely, we have modified the description of quadratic function. In the same time, your suggestion about citing several literatures to support the argument which testify the non-liner relationship between production cost and technology cost in line 310-311. In our article, we used this quadratic function which indicates the high carbon reduction cost, and with the much more carbon reduction quantity, the carbon reduction cost increased further, in the next discussion part, the proposition 5 has testified the conclusion, and they are nonlinear relationship.

 

4. More generally, I took assumption 3 as an example to point out the problems widely existed in model description in the current form. As I pointed out before, since all findings of this study entirely depend on the developed model, sufficient and appropriate description of the model is of great importance. As readers, we would like to know more about the thoughts behind the devise of the model, especially the key information on the design of the model. Therefore, I hope authors could thoroughly go through the manuscript and provide necessary information at each needed place instead of only focusing on solving my example.

Response to 4: We are appreciating your comments about our model description. Based on your suggestion, we adjusted the description of the model thoroughly go through the manuscript, especially in Equilibrium description and basic hypotheses, located in line 279-280, 297-299, 312-314, 347-350. In conclusion, we designed this paper for realizing carbon neutral, we hope the clean coal utilization will be encouraged under government subsidy, and also benefit for reducing carbon emission. Under different dominate modes, the optimal carbon reduction strategy and maximum profit could be found, the clean coal input and carbon reduction quantity also shifted with the cost and subsidy, we can study the optimal dominate mode. The result in discussion part also showed that the subsidy supports clean coal input, and when manufacturer leads, the supply chain will achieve optimal carbon reduction and maximum profit.      

 

Author Response File: Author Response.pdf

Round 3

Reviewer 2 Report

Thanks a lot for the response and improvement of the paper. As authors have also noticed, there are some inappropriate illustrations leading to the understanding difficulties for the readers. I think one misunderstanding may come from the lack of clear definitions of the roles of the coal enterprise and the manufacture. What does the coal enterprise produce? Clean coal (per described in the text) or electricity (per mentioned in the 2nd round response)? And what does the enterprise exactly do? Is it an agent selling clean coal to the down-stream industry and therefore its revenue is the gap between retail and wholesale price of clean coal?
.  

Author Response

Response to Reviewer 2

 

Comments and Suggestions for Authors

Thanks a lot for the response and improvement of the paper. As authors have also noticed, there are some inappropriate illustrations leading to the understanding difficulties for the readers. I think one misunderstanding may come from the lack of clear definitions of the roles of the coal enterprise and the manufacture. What does the coal enterprise produce? Clean coal (per described in the text) or electricity (per mentioned in the 2nd round response)? And what does the enterprise exactly do? Is it an agent selling clean coal to the down-stream industry and therefore its revenue is the gap between retail and wholesale price of clean coal?

 

Response to 1: Thanks for your comments, and we think it is very meaningful to our article. Actually, there are two major objects in our article, the coal enterprise and manufacturer. Coal enterprise produce clean coal, then manufacturer produce electricity or other energy supply by clean coal. There is no agent to sell clean coal, the coal enterprise and manufacturer operated separately. Furthermore, coal enterprise produces the clean coal and sell to manufacturer. In the next stage, manufacturer process the clean coal which could be the resource of electricity or other energy supply. We assumed that the coal enterprise takes wholesale price as traded price with manufacturer, and manufacturer’s revenue come from the gap between price of electricity or other energy supply and wholesale price of clean coal. Therefore, there is not revenue between retail and wholesale price of clean coal you mentioned. For better understand, we added some description about the coal enterprise and manufacturer’s responsibilities, in line 345-352, and we revised the variable declaration about p in table 1, the p stands for the price of energy supply which produced by clean coal.      

Author Response File: Author Response.pdf