© 2015 Electric Power Research Institute, Inc. All rights reserved.
Geoffrey J. Blanford, Ph.D.
EPRI-IEA Workshop on Challenges in Electric Sector Decarbonisation 28 September 2015, Paris
Europe’s Coming Challenges in Meeting Decarbonisation Objectives
2 © 2015 Electric Power Research Institute, Inc. All rights reserved.
EU electric sector will be driven by renewables
Many questions remain: – How far and how fast?
– What mix of wind and solar?
– What regional distribution?
– What technologies will balance the system?
Implications for conventional capacity: – How much currently installed fossil capacity is “slack”?
– What value will existing fleet provide in the future?
– What about new investments?
Depends on national policies vs. EU-wide implementation
3 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Power Sector Under the EU-ETS
0
200
400
600
800
1000
1200
1400
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
Mill
ion
tons
CO
2
CCGT / GT
Hard Coal
Brown Coal
History
Cap
43%
80%
95%
Base Year Power Generation
Emissions (Modeled)
2005 level
4 © 2015 Electric Power Research Institute, Inc. All rights reserved.
EU-REGEN Model of Electricity Investment/Dispatch
Scandinavia
Great Britain
France
Iberia Italy
EE-SE EE-SW
EE-NW
EE-NE
Alpine
N Germany
S
Benelux
EE = Eastern Europe Net Transfer Capacities (ENTSO-E)
> 4 GW 2 - 4 GW 1 - 2 GW < 1 GW Planned
Jointly developed by EPRI and Ifo Institute, Munich
Intertemporal optimization through 2050
Detailed representation of renewable profiles
5 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Renewable Resource Distribution Wind (on-shore) Solar
Based on MERRA reanalysis hourly dataset from US NASA, 1979-2013
30°E
60°N
50°N
40°N
Class 5Class 6
Class 1Class 2Class 3Class 4
70°N
10°W 0° 10°E 20°E 30°E
60°N
50°N
40°N
Class 5Class 6
Class 1Class 2Class 3Class 4
70°N
10°W 0° 10°E 20°E
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Regional System Adequacy (one definition)
Market-clearing condition requires that supply equal demand in each segment/hour in each region:
We include an additional constraint that local available non-intermittent capacity must be sufficient to meet peak load:
Non-Intermittent Dispatch
VRE feed-in
Net Discharge from Storage = Load * (1 + loss) Net
Imports + + +
Non-Intermittent Available Capacity
Storage Discharge Capacity + = Peak * (1 + loss)
7 © 2015 Electric Power Research Institute, Inc. All rights reserved.
EU Generation Mix: 80% by 2050 Policy
0
1000
2000
3000
4000
5000
1990 2000 2010 2020 2030 2040 2050
TWh
CSP
PV
Wind
Gas-CCS
Gas/Oil
Coal-CCS
Hard Coal
Brown Coal
Nuclear
Bio-CCS
Bio+
CHP-Gas/Oil
Hydro
Least-cost emissions reductions: no additional national targets or
subsidies
8 © 2015 Electric Power Research Institute, Inc. All rights reserved.
EU Installed Capacity: 80% by 2050 Policy
0
200
400
600
800
1000
1200
1400
1600
2015 2020 2025 2030 2035 2040 2045 2050
GW
CSP
PV
Wind
Gas-CCS
Gas/Oil
Coal-CCS
Hard Coal
Brown Coal
Nuclear
Bio-CCS
Bio+
CHP-Gas/Oil
Hydro
Peak Load
Residual Peak
9 © 2015 Electric Power Research Institute, Inc. All rights reserved.
0
20
40
60
80
100
120
140
160
180
Lignite Hard Coal CCGT Other Gas/Oil
GW
EU Fossil Capacity 2015-2050
Installed
Retired Early
After initial adjustment, gas capacity does not retire early
Includes industrial
CHP, maintained throughout
Hard coal is retired before lignite
Some “slack” capacity in 2015 doesn’t cover fixed O&M
10 © 2015 Electric Power Research Institute, Inc. All rights reserved.
EU Cumulative New Capacity Investments
0
200
400
600
800
1000
1200
1400
2020 2025 2030 2035 2040 2045 2050
GW
CSP
PV
Wind (off-shore)
Wind (on-shore)
Nuclear
Bio-CCS
Biomass
Gas-CCS
GT
CCGT
Coal-CCS
Hard Coal
11 © 2015 Electric Power Research Institute, Inc. All rights reserved.
0
20
40
60
80
100
120
0% 20% 40% 60% 80% 100%
€pe
r MW
hEnergy-Only Price Distribution in EU, 2030
New CCGT
Existing CCGT
Hard Coal
Brown Coal
Dispatch Cost (including carbon price of €28/t) Range & average across regions/vintages
12 © 2015 Electric Power Research Institute, Inc. All rights reserved.
0
20
40
60
80
100
120
140
Existing CCGT Hard Coal New CCGT Brown Coal
€pe
r kW
-yea
r
Capacity
Energy
Net operating revenue from energy and capacity, 2030
Capacity payments required to cover
fixed O&M
Both sources cover investment and
fixed costs
Still deep in the money
(EU Average)
Fixed O&M
13 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Conventional capacity under decarbonisation
Coal/lignite plants will inevitably scale down production However, generation falls faster than installed capacity
– Some units retire early, many stay online – Fewer hours, lower margins in energy market – Capacity payments are crucial for managing this transition
Natural gas capacity (both CCGT and GT) expand – Hours for CCGT increase, even with rising renewable share – Still, approximately half of new CCGT net operating revenue from
capacity payments
Nuclear declines overall, only grows in East CCS only plays role with 95% target, even then only with
bioenergy or gas – coal CCS is far out of the money
14 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Important factors not modeled here = Ongoing research priorities
Operational constraints – Unit commitment, especially start-up and shut-down costs
– Voltage and frequency stabilisation, system inertia
Interaction with demand side – Changing end-use mix could significantly change load shape
– DSR may be a cost-effective contributor to capacity needs
Coupling with other sectors – Economics of CHP under carbon constraint
– “Power to X” technologies (e.g. hydrogen, heat)
15 © 2015 Electric Power Research Institute, Inc. All rights reserved.
EPRI Webinar on EU Electric Sector Scenarios
November 2015, TBC
Explore other results and scenarios with EU-REGEN, e.g. – Role of renewable technologies, national targets
– Transmission scenarios
– Regional details
– Storage
– Unit commitment constraints
See EPRI staff for more information
16 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Together…Shaping the Future of Electricity
17 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Extra Slides
18 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Regional Generation Mix (TWh) (80% by 2050)
Britain Scandinavia EE (North)
Hydro CHP-Gas/Oil Bio+ Bio-CCS Nuclear Brown Coal Hard Coal Coal-CCS Gas/Oil Gas-CCS Wind PV CSP Energy for Load
0
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 20500
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 20500
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 2050
19 © 2015 Electric Power Research Institute, Inc. All rights reserved.
France Germany Benelux/Alpine
Hydro CHP-Gas/Oil Bio+ Bio-CCS Nuclear Brown Coal Hard Coal Coal-CCS Gas/Oil Gas-CCS Wind PV CSP Energy for Load
0
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 20500
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 20500
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 2050
Regional Generation Mix (TWh) (80% by 2050)
20 © 2015 Electric Power Research Institute, Inc. All rights reserved.
Iberia Italy EE (South)
Hydro CHP-Gas/Oil Bio+ Bio-CCS Nuclear Brown Coal Hard Coal Coal-CCS Gas/Oil Gas-CCS Wind PV CSP Energy for Load
0
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 20500
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 20500
200
400
600
800
2015 2020 2025 2030 2035 2040 2045 2050
Regional Generation Mix (TWh) (80% by 2050)
21 © 2015 Electric Power Research Institute, Inc. All rights reserved.
0
20
40
60
80
100
120
140
160
180
Lignite Hard Coal CCGT Other Gas/Oil
GW
Installed
Covers Fixed O&M
Covers Fixed O&Mwithout RSA Constraint
EU Fossil Capacity in 2015: Over-subscribed?
Model solution in 2015 finds some slack capacity: earnings don’t cover fixed
O&M
“slack” coal mainly in
Scandinavia, Eastern Europe
“slack” gas/oil in Britain, Iberia, Italy
Regional System Adequacy constraint implies higher capacity prices, less slack
22 GW 25 GW
32 GW
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EU Average Full Load Hours by Technology
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6000
7000
8000
2015 2020 2025 2030 2035 2040 2045 2050
Full
Load
Hou
rs
Solar PV
Wind (on-shore)
Bio-CCS
Nuclear
CCGT
Hard Coal
Brown Coal
23 © 2015 Electric Power Research Institute, Inc. All rights reserved.
New CCGT is much lower in the stack
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6000
7000
8000
2015 2020 2025 2030 2035 2040 2045 2050
Full
Load
Hou
rs
Solar PV
Wind (on-shore)
Bio-CCS
Nuclear
CCGT
Hard Coal
Brown Coal
New CCGT
Existing CCGT
24 © 2015 Electric Power Research Institute, Inc. All rights reserved.
“Efficient” Role of Renewables in EU
Wind in North is most valuable renewable resource
Solar in South is competitive (with a carbon price) when costs are lower than: – ~1000 euro/kW for PV
– ~3000 euro/kW for CSP (with 2.5x solar multiplier)
Least-cost mix involves mainly on-shore wind in Britain, Scandinavia, France, and Baltic / North Sea coasts
Wind and solar reach maximum generation share ~33%
This mix could be superseded by national objectives
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