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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