ML090780880
| ML090780880 | |
| Person / Time | |
|---|---|
| Site: | Crane  |
| Issue date: | 11/09/2004 |
| From: | Pletka R Black & Veatch |
| To: | Office of Nuclear Reactor Regulation |
| References | |
| Download: ML090780880 (23) | |
Text
Potential Impacts of an Advanced Energy Portfolio Standard in Pennsylvania Potential Impacts of an Advanced Energy Portfolio Standard in Pennsylvania Ryan Pletka, P.E.
Black & Veatch November 9, 2004 Supported by:
Heinz Endowments Community Foundation for the Alleghenies N R E L E N E R G Y A N A L Y S I S F N R E L E N E R G Y A N A L Y S I S F O R U M O R U M
- 2 PRELIMARY - SUBJECT TO CHANGE Black & Veatch:
Introduction Black & Veatch:
Introduction z Global consulting, engineering, and construction firm z Involved over 100,000 MW of power projects z 7,000 employees in over 100 offices z 50 staff working on all aspects of renewable and advanced energy technologies
- 3 PRELIMARY - SUBJECT TO CHANGE Study Objective Study Objective
- 1. Identify most cost effective mix of resources built in response to AEPS
- 2. Identify economic benefits or costs Assess the Potential Economic Impacts of a 20 Percent Advanced Energy Portfolio Standard (AEPS) in Pennsylvania
- 5 General AEPS Assumptions General AEPS Assumptions z
Timeframe 2006 - 6%
Increases 2%/year 2014 - 20%
z Evenly split in two-tiers:
Tier I - RE & EE Tier II - waste coal, greenhouse gas, advanced technologies z
No imports or exports (simplification for analysis) z Production Tax Credit through 2009 AEPS Energy Requirements 0%
2%
4%
6%
8%
10%
12%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Tier I Technologies Tier II Technologies 2004 Tier I Baseline 2004 Tier II Baseline
- 6 PRELIMARY - SUBJECT TO CHANGE AEPS Resource Assessment Methodology AEPS Resource Assessment Methodology z Screen Technologies z Characterize Resources z Estimate Cost to Generate and Transmit Electricity z Apply Avoided Cost of Power Model z Develop Supply Curves z Develop Least-Cost Portfolio of Projects
- 7 PRELIMARY - SUBJECT TO CHANGE AEPS Eligible Resources AEPS Eligible Resources Tier I z
Wind z
Low-impact hydro z
Biogas and coal mine methane z
Biomass z
Solar photovoltaics z
Energy conservation - demand side, ie, consumers z
Energy efficiency - supply side, ie, power plants z
Solar thermal z
Ocean and lake energy z
Solid waste (non combustion) z Fuel cells fueled by Tier I resources Tier II Resources z
Waste Coal
New facilities
Air pollution controls at existing facilities z
Integrated gasification combined cycle z
Fuel cells fueled by non-Tier I resources z
Greenhouse gas (GHG) reductions
- 8 Wind Assessment Wind Assessment z Pennsylvania wind resources relatively modest z GIS analysis based on latest NREL data z Capital Cost:
Base: $1,175-$1,275/kW Transmission: +$20-$110/kW Expensive resources: +$500/kW (50% of total) z Included 300 MW, class 5, offshore wind farm in Lake Erie
- 9 Biomass Cofiring Assessment Biomass Cofiring Assessment z Pennsylvania has good biomass resources and lots of coal plants z Focused on cofiring at 38 existing coal units Capital cost: $100-$700/kW z Biomass resources Only sustainable and clean resources identified Assessment based on ORNL database Biomass collected from 75 mile radius around plants
- 13 Energy Conservation / Efficiency Assessment Energy Conservation / Efficiency Assessment z
Good opportunity for energy conservation/efficiency in PA z
Analysis Based on B&V, ACEEE assessments Residential measures Commercial & Industrial measures z
Over 16,000 GWh of potential identified over 20 years About 10% of PA consumption Wide range of costs and payback potential Consumers wont necessarily implement measures even if economical
- 14 PRELIMARY - SUBJECT TO CHANGE Waste Coal Combustion Waste Coal Combustion z Excellent waste coal resource in Pennsylvania z To be eligible for AEPS, waste coal projects must be low emissions z Analysis Based on PA DEP waste coal assessments 3 Planned New Site Developments 15 Environmental control upgrades at existing plants z Environmental control upgrade projects also receive substantial revenue from emissions credit markets
- 15 PRELIMARY - SUBJECT TO CHANGE Properly Characterizing Resource Cost Properly Characterizing Resource Cost z One of the largest modeling differences between renewables and fossil fuels is that costs vary tremendously based on renewable resource quality z There are a limited number of very good renewable / advanced project sites z Costs rise as low-hanging projects are developed z Supply curves capture these effects
- 17 PRELIMARY - SUBJECT TO CHANGE
-15
-10
-5 0
5 10 15 20 1
161 321 481 641 801 962 Generation, GWh Levelized Cost Premium, $/MWh A
Biogas Supply Curve 2006 Premium over Avoided Costs Biogas Supply Curve 2006 Premium over Avoided Costs
~60 MW
~70 MW
~30 MW
- 18 2010 Supply Curve
-60
-40
-20 0
20 40 60 80 100 120 23 3,476 6,929 10,382 13,835 17,288 20,741 Generation, GWh Levelized Cost, $/MWh Additional Renewable Generation Required: 3154 GWh Aggregate Tier I Supply Curve 2010 Aggregate Tier I Supply Curve 2010 Wind Biom ass Cofiring Biogas Solar Hydro Fuel Cells - Tier I Energy Efficiency Energy Conservation Wind Biom ass Cofiring Biogas Solar Hydro Fuel Cells - Tier I Energy Efficiency Energy Conservation Tier I 2010 requirement Biomass Cofiring and Energy Efficiency /
Conservation add Significant Flexibility Premium
- 19 Aggregate Tier II Supply Curve 2010 Aggregate Tier II Supply Curve 2010 2010 Supply Curve 0
20 40 60 80 100 120 16 2,354 4,693 7,032 9,371 11,710 14,049 Generation, GWh Levelized Cost, $/MWh Additional Renewable Generation Required: 2955 GWh Waste Coal New Waste Coal Environm ental Com pliance Integrated Gasification Com bined Cycle Fuel Cells - Tier II GHG Offsets Waste Coal New Waste Coal Environm ental Com pliance Integrated Gasification Com bined Cycle Fuel Cells - Tier II GHG Offsets Tier II 2010 requirement Premium
- 20 Tier I Cost Premium Supply Curves Tier I Cost Premium Supply Curves (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2006 2006 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2008 2008 2006 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2010 2010 2008 2006 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2012 2012 2008 2010 2006 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2014 2014 2008 2010 2012 2006 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed in 2016 2012 2014 2016 2010 2008 2006
- 21 Tier II Cost Premium Supply Curves Tier II Cost Premium Supply Curves (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2008 2008 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2010 2010 2008 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2012 2012 2008 2010 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
Last Project Developed for 2014 2014 2008 2010 2012 (60.00)
(40.00)
(20.00) 20.00 40.00 60.00 80.00 100.00 120.00 0
5,000 10,000 15,000 20,000 Generation, GWh Levelized Cost Premium, $/MWh A
No Projects Developed in 2016 2012 2014 2016 2010 2008
- 22 Optimum Mix of Resources to Meet the AEPS Requirements Optimum Mix of Resources to Meet the AEPS Requirements Wind 6,361 GWh 39%
Energy Efficiency 660 GWh 4%
Hydro 2,011 GWh 12%
Solar PV 6 GWh 0%
Biomass Cofiring 4,097 GWh 25%
Landfill Gas 906 GWh 6%
Energy Conservation 2,256 GWh 14%
Tier I Energy Mix Waste Coal New 7,818 GWh 49%
Waste Coal Environmental Compliance 8,097 GWh 51%
Tier II Energy Mix
- 23 Tier I Least Cost Mix Tier I Least Cost Mix z Wind, biomass cofiring, and energy conservation comprise about 80 percent of mix z Some solar (4 MW) assumed to be built, even though not economical Technology Wind Landfill Gas Biomass Cofiring Hydro Solar PV Energy Con-servation Energy Efficiency Share of RPS Mix (energy), %
38.6%
5.7%
24.9%
12.6%
0.0%
14.0%
4.1%
Energy, GWh 6,361 906 4,097 2,011 6
2,256 660 Capacity, MW 2,315 129 637 460 5
555 120 Capacity Factor, %
31%
80%
73%
50%
14%
46%
63%
Capital Cost, $/kW 1,498 2,083 283 1,791 6,534 975 2
Average Cost Premium, $/MWh 12.56 (1.51) 12.02 10.96 517.2 (30.85)
(0.34)
- 26 PRELIMARY - SUBJECT TO CHANGE Economic Impacts Assessment Economic Impacts Assessment z Compared building a 20% AEPS portfolio to building the Business As Usual (BAU) portfolio Cost of electricity Economic impacts (Jobs, Output, Earnings)
Fossil fuel prices z BAU Portfolio: 50% coal, 40% combined cycle, 10% simple cycle z Portfolios equated on an equivalent energy production basis RPS portfolio: 6,470 MW BAU portfolio: 2,460 MW z Environmental externalities purposely not assessed
- 27 Cumulative Economic Impacts Cumulative Economic Impacts Cost of Electricity Employment Impact (job-years)
Earnings Impact Output Impact AEPS Portfolio
$ 3.9 Billion 165,689
$ 6.6 Billion
$ 18.9 Billion BAU Portfolio
$ 6.6 Billion 94,753
$ 4.1 Billion
$ 11.9 Billion Difference
-$ 2.7 Billion 70,937
$ 2.5 Billion
$ 6.9 Billion z
Economic Benefits of the AEPS Portfolio compared to Business as Usual Cost of electricity: reduced by $2.7 billion (cumulative present value),
about 1% when spread over all consumption Employment: Creates over 70,000 additional job-years over 20 years (average of new 3,500 jobs)
State output: Creates about $7 billion in increased state output Personal Income: Creates about $2.5 billion in additional earnings
- 28 Pennsylvania Employment Impacts, Job-years per MW Pennsylvania Employment Impacts, Job-years per MW 5
10 15 20 25 30 35 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 Construction Construction 5
10 15 20 25 30 35 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 Construction Operation Construction Operation RPS portfolio: 6,470 MW BAU portfolio: 2,460 MW Impacts proportional to the percent of project expenditures made in PA in various industries
- 29 PRELIMARY - SUBJECT TO CHANGE Open Issues Open Issues z Regional Supply and Demand Balance z Benefits and Drawbacks of Credit Trading z Location and Deliverability Requirements z Implementation and Rulemaking
- 30 PRELIMARY - SUBJECT TO CHANGE Conclusions and Acknowledgements Conclusions and Acknowledgements z Acknowledgements Community Foundation for the Alleghenies - Mike Kane Heinz Endowments PA DEP REPP Industry z Contact Ryan Pletka Black & Veatch 913-458-8222 pletkarj@bv.com