Download - Generation Portfolio Options Study Philip O’Donnell Manager, Generation Analysis 14 October 2009
Generation Portfolio Options Study
Philip O’Donnell
Manager, Generation Analysis
14 October 2009
Context• Many existing plant are due for retirement by 2025 including Moneypoint.
• If no action is taken, portfolio will be most likely be predominately Gas and Wind.
• This may not be desirable or optimal:
– fuel security of supply
– Appropriate plant to balance intermittent generation
• EirGrid has initiated a study to examine generator portfolio options post 2025.
• What portfolio options are there?
• What are their characteristics?
• How do the portfolio options rate against the following criteria?
– Environmental impact
– Cost / Competitiveness
– Security of Supply
Gate2, Gate 3 and other accepted/live offers
4 GW 3.9 GW
1.6 GW
1 GW260 MW
1.4 GW
140 MW
Gate 3 wind Gate 2 Wind Biomass/LFG/CHP Interconnection
Pumped Storage CCGT OCGT
Terms of Reference for Study
• Develop a range of generation portfolios that represent a broad range of future technology
options
• Provide detailed information on the characteristics of each generator technologies:
• Evaluate the generation portfolio options against a number of criteria.– Cost– Emissions– Security of supply implications– Health & Safety– Public Acceptability– Technical and financial risks– Compatibility with relevant policy– Consistency with Ireland’s general strategic direction
• Evaluate on how robust are these portfolios to alternative trajectories of demand, fuel price, renewable growth and how future-proof are they?
• Propose a timetable of milestones when decisions should be made on particular technology.
Study Aims
• Factual and objective
– No preferred position
– Identify where opinion is stated e.g. cost uncertainty, technical outlooks on CCS.
• Provide source of reference for use in energy policy debate
• Accessible and readable to non-technical readers.
• It will identify some system operator issues:– Security of supply.
– Balanced portfolio (appropriate mix of plant).
– But transmission or locational issues will not be considered.
Low Carbon Targets
• It is likely that long term targets will be based on low carbon
power generation. Possible low carbon targets include:
– No carbon generation.
– 80% reduction in carbon emissions.
– Less than 100g/kWh CO2.
• Proposal is to use target <100g/kWh CO2
– What portfolio options have the potential to achieve this?
Carbon emission intensity
720.6
583.4
341.2
43.019.2
0
100
200
300
400
500
600
700
800
Coal OCGT CCGT CCS Coal CCS Gas
kgC
O2/
MW
h
Input assumptions: Demand Forecast
• Peak demand and total demand
grow at the same rate.
• To minimise scenarios, central
demand considered only.
• Central year studied = 2035
Demand to 2050
0
10
20
30
40
50
60
70
2003
2006
2009
2012
2015
2018
2021
2024
2027
2030
2033
2036
2039
2042
2045
2048
Sys
tem
Dem
and
(TW
h)
.
System Demand (TWh) High
System Demand (TWh) Central
System Demand (TWh) Low
%/yr Demand growth High 1.20Medium 0.70Low 0.20
Input assumptions: Fuel Forecasts - Oil
• High degree of uncertainty
over future oil prices.
• Expensive to develop but
large unconventional
sources are assumed to set
an upper boundary on
prices.
• We are using the central
and high projections
0
20
40
60
80
100
120
140
1996 2006 2016 2026 2036 2046
$/ba
rrel
(20
08 r
eal)
High Central Low
Oil price projections (Brent)
Input assumptions: Carbon Price Forecasts
• The price of carbon is the main
driver for the adoption of low
emissions generation
technology
• Current EU policy seems to
point towards a higher carbon
price in the future
• We are using the central and
High projections
Carbon price projections
0
10
20
30
40
50
60
70
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
€/to
nne
(200
8 re
al)
High Central Low
Plant portfolios
0
2
4
6
8
10
12
14
16
18
20
22
24
Gas Nuclear CCS HighRenewables
HighRenewables +
intercon
Highrenewables +
storage
2030
Insta
lled
ca
pa
city (
GW
)
Pumped storageInterconnectorOilOCGTCCGTCoalCCSCoalNuclearBiomass + peatHydroMarineWind
Lifetime Generation Costs
70.9
91.9
69.4
80.5
106.2
75.3
93.6
67.1
118.6
229.1
159.2
0
50
100
150
200
250
Coal OCGT CCGT CCS Coal CCS Gas Nuclear Biomass OnshoreWind
OffshoreWind
Wave Tidal
Real 200
8 €
/MW
h
Other Works Costs
Carbon
Fuel
CAPEX
Further Interconnection
2GW
3GW
Status
• Study contract awarded to Poyry
• Workshop with stakeholders held 3rd September
• Initial results due soon
• Report due to be published in November
International Experience
• A European Commission report* finds that for a sustainable portfolio to
develop, the following must occur:
– Sustained high CO2 prices (>34-55 €/tCO2)
– Commercialisation of CCS technology
– Medium-High fossil fuel prices prevail (Oil > $50/barrel)
• Other studies:– UK Energy Research Centre (http://www.ukerc.ac.uk/support/tiki-index.php?
page=UKERC2050homepage)
– IEA Energy Scenarios 2050 (http://www.iea.org/textbase/nppdf/free/2000/2050_2003.pdf)
– IIASA World Energy Council (http://www.iiasa.ac.at/Research/ECS/docs/wec_orderbook.html)
* http://ec.europa.eu/dgs/jrc/downloads/jrc_reference_report_200907_fossil_fuel_electricity.pdf