Wednesday, January 27, 2010

The cost of carbon mitigation with renewables

The National Renewables Energy Laboratory appears to be doing or sponsoring some decent quality research. inadvertently some of that research seems to undercut the case for renewable energy, or at the very least provide what should be a very sobering picture for renewables advocates. Last week I pointed to the Eastern Wind Integration and Transmission Study which appeared to demonstrate that the cost of electricity would rise as wind penetration increased on the Eastern Interconnect. Although the Western Wind and Solar Integration Study has not been completed yet, Some preliminary findings have been reported. I recently reviewed a preliminary study, How do Wind and Solar Power Affect Grid Operations: The Western Wind and Solar Integration Study, by D. Lew and M. Milligan of the National Renewable Energy Laboratory, and G. Jordan, L. Freeman, N. Miller, K. Clark, and R. Piwko GE. The WWSIS
examining the operational impact of up to 35% wind, photovoltaics, and concentrating solar power on the WestConnect grid in Arizona, Colorado, Nevada, New Mexico, and Wyoming.
I was particularly interested in the operational analysis, which was based on a computer simulation by GE. The simulation looked at 5 scenarios. In the first no wind was assumed and all electricity was generated by four generation sources, Nuclear, Coal, Combined cycle gas turbines, and hydroelectric generation. The second simulation assumed 11% renewables, 10% wind, and 1% solar. The third simulation assumed 20% wind and 3% solar, and the 4th simulation assumed 30% wind and 5% solar. Finally a simulation was run with the same 35% penetration, but using data from a week in July 2006, rather than the week in April 2006 assumed by the other studies. Peter Hawkins has argued that renewables penetration tends to displace Combined Cycles 'gas turbines, rather than coal fired steam plants, and that Open cycle Gas Turbines would be preferred to backup wind, because they would respond more quickly to sudden loss of generation or increased electrical demands. The GE simulations offer a chance to test Hawkins thesis, and the data suggests that indeed the GE simulations supported Hawkins hypothesis. At 11% penetration, only CCGT were displaced, but coal use was completely unaffected. At the 23% penetration level, most of the displacement effected CCGTs, but a small amount of coal displacement began to emerge. At the 35% penetration level for the week in April 2006, a considerable amount of coal generation was displaced, while CCGT use disappeared completely.. Finally the July 2006 simulation suggested that the summer wind problem was adversely impacting wind performance, at the same time electrical demand increased. The shortfall in wind performance had to be made up with CCGTs, and there was no coal displacement.

Estimates of CO2 emissions from CCGTs indicate that they produce about 0.8 pounds of CO2 per kWh of electricity generated. in contrast coal burning generators produce about 2 pounds of CO2 per kWh. Thus when CCGTs are displaced by renewables about 800 pounds or 0,4 tons of CO2 emissions are prevented per MW of electricity generated. When coal is displaced, about 1 ton of CO2 emissions are eliminated. Clearly then it is far more desirable from he viewpoint of carbon mitigation to displace coal burning plants, rather than CCGTs.

As with all National Renewables Energy Laboratory reports, the WWSIS made no attempt to compare renewables costs and performance with nuclear power. But a relatively simple thought experiment can yield some very telling results. First we can assume that nuclear power will displace coal rather than CCGT. The Energy Information Agency estimates that the levelized cost of Advanced Nuclear will be 119.0, or about 12 cents per kWh. If nuclear displaces coal at that cost, the cost of displacing one ton of CO2 would be $119. Now let us take the 11% renewables case. The 2016 levelized cost of wind is 149.3, while the levelized cost of solar thermal is 256.6. Thus the average levelized cost of the 11% renewables is 159.08, and the cost of displacing a ton of CO2 with renewables is $159.0 + transmission costs and other hidden cost of wind generation systems, and the added CO2 emissions of fossil fuel wind backups kept spinning. plus the added CO2 efficiencies of fossil fuel generators used in load leveling and load following roles. Since wind is displacing relatively carbon efficient CCGTs rather than carbon inefficient coal fired generating plants. each MW of CCGT power displaced would produce 800 pounds of CO2, rather than a ton of CO2 produced by the equivalent electrical output of a coal fired power plant. Thus carbon mitigation with the 11% wind April scenario will cost about $400 + hidden costs or over three times as much as nuclear power would costs.

In the April 35% penetration case, wind becomes the predominate source of electricity on most days, and it displaces 2/3rds of coal generation capacity and all the CCGTs. Yet for the July 35% penetration case, wind failed to displace most CCGTs and no coal. Thus the WWSIS study data reported provided in sufficient information for understanding the the potential carbon mitigation costs . However it should be noted that the DoE study, Eastern Wind Integration and Transmission Study(EWITS) found that the cost of total system electrical output increased
dramatically as wind penetration rose to 30%. (Note scenario 4 in figure 8,2)


LarryD said...

"First we can assume that nuclear power will displace coal rather than CCGT."

At least you're stating it explicitly, but such assumptions still make me itch. Justification?

Despite that fact that Combined Cycle Gas is cheaper than coal, coal was not easily displaced in the study, why would this be different when it's nuclear instead of wind?

Charles Barton said...

Larry, that is actually a very good question, and constitutes a major problem in the replacement of coal. Nuclear is more expensive than coal at the moment, but this may not always be the case, especially if a carbon tax is imposed on coal use. if CO2 emissions are heavily taxed, nuclear may find itself on a level playing field or even better. Conventional nuclear will not replace OCGTs, but LFTRs can. CCGTs are not cheaper than coal, but their capital costs are when the price of NG is high. The price of NZG can fchange dramatically

DW said...

What no one ever seems to talk about is that not all gas fired plants are CCGTs or SCGTs (combined cycle gas turbines and simple cycle GTs).

I don't have statistics at hand but large double digit %s of natural gas is burned in conventional thermal units. South California, for example, has about 15 of these kinds of plants. I'm sure nationally they are at least 25% of all gas fired generation and these certainly can be replaced by nuclear.

Charles Barton said...

David, I would think that NG thermal plants would be less energy efficient, and thus more expensive to operate than OCGTs.

arcs_n_sparks said...


Given this thread and that of Bill Hannahan, perhaps you and some of your readers may want to comment on the FERC proposed rule regarding variable energy sources (their term)published in the Federal Register today.


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