Research Center for Energy &Environment Case study on Quang Tri wind power project and the needs for...

Research Center for Energy &Environment

Case study on Quang Tri wind power project and the

needs for capability development

Dr. Nguyen Duc MinhDr. Nguyen Tien Nguyen

Research Center for Energy & EnvironmentAddress: Nguyen Chi Thanh Road

Building: Regional Hydrometeorological Centers of Red River Delta Tel: 08-4-7733686- E-mail: [email protected]

Website: http://www.rcee.net


Sustainability: + COP7: Renewable energy use is sustainable

technology + Vietnam government set high priority for

renewable energy development.- Additionality: + CO2 additional reduction is certain. + Technology transfer is promising.

CDM eligibility


+ Country level: BAU projection for energy demand.

+ Sectoral level: Master Plan V for electricity expansion to 2010 with outlook to 2020.

+ Project level: Coal fired plants.

- Plan for new coal fired plants and their technological specifications.

- Averaged indicator of 20% top-plants.

- Be sure that while wind power comes to grid, coal power will be correspondingly reduced.

Baseline


+ Boundary: Only inside of plants, wind or coal. + Time: 2002-2008, 2008-2012 and 2012-2020. + Direct leakage: - Up-stream of coal cycle is not taken into

consideration. - Emission during material production and

manufacture is neglected. + Indirect leakage is not discovered.

Project boundary and leakage


Methodology-levelized generation cost

Construction period N years

commissioning

Life time: M years


1. Investment capital($/kW)

- Overnight: Po.

- Final( total) Investment capital: P

P= P1(1+IDC)(N-1) +......+Pn = Po/N*((1+IDC)N-1)/IDC

IDC: Annual interest during construction.

2. Generation cost( GC:$/kWh)

GC = INC + OM + Fuel:

INC:Investment cost. Payback the Investment Capital

OM: Fixed O&M cost.

Methodology-levelized generation cost


+ INC:

Assumption: - Electricity price is unchanged during life time of projects.

- Electricity generation is unchanged over the years.

- DR: Discount rate = 10%

- LF : Load factor %

INC = P*(1+DR)M*DR/((1+DR)M - 1)/LF/8760

+ OM: Fixed O&M is given in $/kW/year. Then OM = Fixed O&M / LF/8760

INC and OM


Inputs and results for GCParameters Unit Coal plant Wind power Unit capacity MWe 600 1.25 Overnight Investment US$/kWe 973 1000 Construction period year 3 2 Interest rate during construction %/year 10 10 Total Investment Capital US$/kWe 1072.5 1050 Life time year 30 20 Load factor % 70 25,30,35,40 Efficiency %( LHV) 34 100 Emission factor gC/kWh 276 0 Discount Rate %/year 10 10 Fuel Price US$/GJ 1.23 0 Fixed O&M cost US$/kWe/year 31.4 20.2 Variable O&M cost US$/kWh 0.00175 0 Results Capital Investment cost US$/kWh 0.0186 0.0563, 0.0469,

0.0402,0.0352 O&M Cost US$/kWh 0.0051 0.00916,0.00763,

0.00654,0.00572 Fuel Cost US$/kWh 0.0130 0 Generation Cost US$/kWh 0.0367 0.0655, 0.0545,

0.0467, 0.0409


Carbon avoided

• Based on previous results, one kWh of Wind power abates 276 gC or 1013g CO2.

• One Wind tower of 1250 kW capacity with load factor of 30%( the supposed to be more probable capacity) can abate 3327.7 tons CO2 annually

• The Wind field with 20MW capacity has 16 towers (1.25MW each). The amount of carbon avoided depends on towers introduction scheme. The proposal scheme and results of Carbon avoided are shown in the following table:


Carbon avoidedTime Towers in

Operation Electric generation

kWh Carbon avoided

tons CO2

Cumulative tons CO2

2004 1 3,285,000 3,327.68 2005 3 9,855,000 9,983.119 2006 10 32,850,000 33,276.8 2007 16 52,560,000 53,242.89 2004-2007:

99,830.5 2008-2012 16 52,560,000

annually 53,242.89

annually 2008-

2012:266,214.4 2013-2023 16 52,560,000

annually 53,242.89

annually 2013-

2023:585,671.7 2024 15 49,275,000 49,571.6 2025 13 42,705,000 43,259.85 2026 6 19,710,000 19,966.24 2027 0 0 0 Total 1,064,514.3


CO2 reduction cost

RC($/TCO2)=(GCw-GCc)/Emission factor

+ Carbon reduction cost with coal fired plant as base line can be calculated based on results of levelized generation cost: CO2 reduction cost($/TCO2) = 987.2*( 1.63736/X-0.0367) Wind Capacityfactor%

25 30 35 40

Red. Cost($/TCO2)

28.43 17.65 9.95 4.18


Price of CO2 in dependence on electricity price, paid by EVN:

CO2 price($/TCO2)=(GCw-Pr)/Emission factor

X(%) 25 30 35 40 Pr :price of EVN ($/KWh)

0.04 25.169 14.393 6.695 0.922 0.0425 22.701 11.925 4.227 -1.546 0.045 20.233 9.456 1.759 -4.014

0.0475 17.765 6.988 -0.709 -6.482 0.05 15.297 4.520 -3.177 -8.950

Formula: CO2 price( $/TCO2) = 987.2*( 1.63736/X-P).


CO2 red. cost vs. wind apacity factor and elec. price

-15

-10

-50

5

10

1520

25

30

25 30 35 40

Wind capacity factor%

CO2

Red.

cos

t $/T

CO2

elec. Price=0.04$/kWh elec. Price=0.0425$/kWhelec.price=0.0475$/kWh elec. Price=0.05$/kWhelc. Price =).045$/kWh


RCEE wind speed measurement tower in Cua Tung


Capacity Needs for CDM Project Implementation


Capacity Needs for CDM Project Implementation

1. Institutional Framworks2. Methodology and Technology

Transfer3. Financial issues4. The role of NGOs


Capacity Needs for CDM Project Implementation (Cont.)

• 1. Institutional Issues:+ International aspect: It is expected the Procedure for CDM will be completed .+ National aspect: After ratification of KP Protocol by the Government, an institutional and legal system for CDM implementation will be set up.

Training on the institutional issue is needed



2. Methodology and Technology Transfer

+ Methodology approach such as Baseline should be defined

+Environmental friendly technology for different sectors should be introduced



3. Financial Issues:+ Transaction cost

+ Economic aspect of the project

+ CO2 price

+ Investment Capital

Financial Approach should be introduced



4. The role of NGOs+ In Vietnam, NGOs are more interested in CDM

+ Advantage of NGOs is the ability of flexibility in action

+ Disadvantage of NGO is lack of resources.

A combination of Government and Non-Government Organizations is the best solution


Thank you for Attention.

Research Center for Energy &Environment Case study on Quang Tri wind power project and the needs for...

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