vattenfall - world banksiteresources.worldbank.org/.../vattenfall.pdf•the group employs around...

© Vattenfall AB

Vattenfall

Transformation from a fossil fuel based energy supply to a

renewable energy supply

Challenges and opportunities

May 2010

Henrik R. Hansen – Vattenfall, Heat Nordic

© Vattenfall AB

About Vattenfall

• Vattenfall was founded in Sweden nearly 100 years ago and converted into

a public limited company in 1992

• The group employs around 39,000 people and the parent company, Vattenfall AB,

is wholly owned by the Swedish State

• Vattenfall is Europe’s fifth largest generator of electricity and the largest

generator of heat

• Vattenfall is active at all stages of the electricity value chain: generation,

transmission, distribution and sales. Vattenfall is also active in electricity trading

and generates, distributes and sells heat

• The company currently has operations in Sweden, Finland, Denmark, Germany,

Poland, the Netherlands, Belgium and the UK with a total of 7.4 million electricity

customers and 5.6 million network customers

© Vattenfall AB 3

Vattenfall - Map

BG Nordic

(Sweden, Finland, Denmark)

BG Central Europe

(Germany, Poland)

BG Pan Europe

(Wind, Nuclear, Engineering)

BG Benelux

(Belgium, the Netherlands)

© Vattenfall AB

Horns Rev*

160 MW

Nordjyllandsværket

656 MW

Fynsværket

439 MW

Ensted coal terminal

Amagerværket

331 MW

285 MW

Hillerød & Helsingør CHP plants

135 MW

*Vattenfall owns 60%

Production in Denmark

Annual production: 6 TWh of electricity and 6 TWh

of heat – corresponding to

about 17.5% of Denmark's electricity consumption

and about 17% of

Denmark's total district heat consumption

© Vattenfall AB 5

Strategic direction and climate vision

• Vattenfall’s climate vision is

for our entire operations to be climate-neutral by 2050 (by 2030

for the Nordic operations) and

achieve a 50 per cent reduction in emissions from our own

operations by 2030 compared with 1990.

• The new electricity that is needed to achieve the 2030 goal will

come from:

- renewable sources (such as wind power, bio energy,

ocean energy)

- Gas and coal power using CCS (Carbon Capture and

Storage) technology

- nuclear power

• Making electricity clean is our strategic direction over the

coming decades.

© Vattenfall AB

One possible road to CO2 neutrality i 2030 (Nordic)

(1.000)

-

1.000

2.000

3.000

4.000

5.000

6.000

7.000

2009 2014 2019 2024 2029

År

CO

2 [

kto

n/å

r]

2030

Activities:

AMV1 100% bio

Bio co-combustion Uppsala KVV

NJV2, Shutdown

Maxbio AMV3 Phase 1 (20%),

Maxbio NJV3 Phase 1 (20%)

Bio Fynsværket

Maxbio NJV Phase 2 (40%)

Vanaja new bioboiler

AMV3 100% biomass or CCS

Uppsala without peat

CCS NJV (Coal and Biomass)

Myllykoski 100% bio

FYV7 100% biomass or CCS

1

1 4

3

2

5

6 7

8

9

10

11

12

12

11

10

9

8

7

6

5

4

3

2

© Vattenfall AB

400.000 ton biomass in 2010 1.800.000 ton biomass in 2020

With the right incentives and framework, it is possible to increase the volume of biomass

0%

29%

44%

27%32%

41%

21%

6%

Træflis

Træpiller

Halm

Halmpiller

© Vattenfall AB

Power and district heating prices, as well as investments are are exposed to competition and risk

• All production of power and district heating using biomass has to be competitive to alternative production regionally and locally.

• The transformation from fossil fuels to biomass needs long-term political devotion. Legislation has to be transparent and predictive, decreasing risk - and not the opposite.

• Investments are competing on IRR and risk profile and investment funds are limited.

• Solutions have to rest on marked principals.

© Vattenfall AB

Investments wood chips and wood pellets

UnloadingAbt. 2 weeks

Storage

Coarse

grindingDrying Pulverizing

Firing

SystemBoiler

Waste

Water

treatment

Woodchips 30%

moisture

Wood dust 10%

moisture

Firing

SystemBoilerUnloading

Storage

buffersilo

Pulverizing

of Pellets

© Vattenfall AB

Example – Getting a positive NPV

-2.500

-2.000

-1.500

-1.000

-500

0

Expenses Heat income Green

certificate

Coal purchase CO2-quotas

NP

V 2

010 [

MD

KK

]

Biomass Decreased power productionO&M InvestmentHeat sales Green certificateReduced Coal Reduced CO2

© Vattenfall AB

Amagerværket

Retro-fitting of

Amagerværket blok 1

• Unit 1 was build in 1971 as a coal

fired unit and retro-fitted in 2005 – 09

as a multi-fuel unit for wood and straw

pellets, coal and oil.

• The unit produces heat and steam

for the City of Copenhagen (KE and

CTR).

• The heat is transported through a

tunnel to two delivery points.

© Vattenfall AB

e

Fjernvarme-dampledninger

i stål-kappe (ø508/ø1016)

Fjernvarme-vandledninger

i alu-kappe (ø406/ø600)

Pumpekondensatledninger

i stålkappe (ø323/ø710)



















© Vattenfall AB

Amagerværket

Amagerværket unit 1

•70 MW power

•250 MJ/s heat (steam)

Fuel: Wood and straw pellets, coal and oil

At least 40 % of the fuel to be biomass, but 100% is more likely.

Amagerværkets unit 3

250 MW power

330 MJ/s heat (steam)

• 40 % biomass pellets substitute 190.000 ton coal

•100% biomass pellets substitute 475.000 ton coal

© Vattenfall AB

Sourcing, trading and logistics

• Worldwide and regional sourcing according to UN 10

principles of sustainability

•Participation i building up trading tools on biomass fuels

•Assisting projects to utilize un-used biomass resources

•Investments in logistical infra-structure

© Vattenfall AB

Investment decisions

•Participation by the City of Copenhagen (KE+CTR – heat

distributors) is important.

•Fair sharing of costs and benefits from substitution of

fossil fuels with biomass between Vattenfall and the City of

Copenhagen.

•Long-term security of cash-flow is important (positive

NPV and acceptable risk profile)

•Sustainability is important

•Customer satisfaction is important

vattenfall - world banksiteresources.worldbank.org/.../vattenfall.pdf•the group employs around...

Documents