The Power to Reduce
CO2 Emissions
The Full Portfolio
Energy Technology Assessment Center
Electric Power Research Institute
© 2008 Electric Power Research Institute, Inc. All rights reserved.
1
Presentation Objective…Answer Three Questions
• What is the technical potential for reducing
U.S. electric sector CO2 emissions?
• What are the economic impacts of different
technology strategies for reducing U.S.
electric sector CO2 emissions?
• What are the key technology challenges for
reducing electric sector CO2 emissions?
© 2008 Electric Power Research Institute, Inc. All rights reserved.
2
2008 Prism...Technical Potential for CO2 Reductions
3500
AEO2007*(Ref)
Achieving all targets is very aggressive, but potentially feasible.
AEO2008*
(Early release)
3000
U.S. Electric Sector
CO2 Emissions (million metric tons)
AEO2008*(Ref)
Impact of efficiency
measures in Energy
Independence and
Security Act of 2007
(EISA2007)
2500
2000
Technology
EIA 2008 Reference
Target
Load Growth ~ +1.05%/yr
Load Growth ~ +0.75%/yr
Renewables
55 GWe by 2030
100 GWe by 2030
Nuclear Generation
15 GWe by 2030
64 GWe by 2030
No Heat Rate Improvement for
Existing Plants
40% New Plant Efficiency
by 2020–2030
1-3% Heat Rate Improvement for 130
GWe Existing Plants
46% New Plant Efficiency
by 2020; 49% in 2030
CCS
None
Widely Deployed After 2020
PHEV
None
10% of New Light-Duty Vehicle Sales
by 2017; 33% by 2030
< 0.1% of Base Load in 2030
5% of Base Load in 2030
Efficiency
1500
1000
Advanced Coal
Generation
500
0
1990
DER
1995
2000
2005
2010
2015
*Energy Information Administration (EIA) Annual Energy Outlook (AEO)
© 2008 Electric Power Research Institute, Inc. All rights reserved.
3
2020
2025
2030
Generation Mix
2007 U.S. Electricity Generation Mix
Non-Hydro Renewables, 2%
Conventional Hydropower, 7%
EPRI “Prism” Projected 2030 Generation Mix
Nuclear, 21%
Conventional
Hydropower
5%
Non-Hydro
Renewables, 9%
Coal
w/o CCS
39%
Natural Gas, 18%
Petroleum, 1%
Coal, 51%
EIA 2008 with Energy Bill – Projection for 2030
Coal, 58%
Non-Hydro Renewables, 5%
Conventional Hydropower, 6%
Nuclear
29%
Nuclear, 19%
Natural Gas
5%
Natural Gas, 11%
Petroleum, 1%
© 2008 Electric Power Research Institute, Inc. All rights reserved.
4
Advanced Coal
w/CCS, 13%
The Scale of Electricity Demand
• 2007 U.S. electricity consumption ~ 3800 TWh
– NY metro area ~ 89 TWh/year (as of 2006)
• EIA 2008 Annual Energy Outlook
– Preliminary report projects 1150 TWh (30%) increase in
U.S. electricity consumption by 2030.
– ~Equivalent to addition of 13 New York metro areas
– Greater than addition of new load equivalent to 2006
consumption of Texas, California, Florida, Ohio,
Pennsylvania
© 2008 Electric Power Research Institute, Inc. All rights reserved.
5
The Scale of Electricity Demand
• Scale of generation
–
–
–
–
One advanced light water nuclear plant (1400 MW, 90% CF) ~ 11 TWh
One coal plant (500 MW, 80% CF) ~ 3.5 TWh
One natural gas turbine (400 MW, 40% CF) ~ 1.4 TWh
One 100 MW Wind Farm (100 1 MW Turbines, 40% CF) ~ 0.35 TWh
• Intensity of CO2 emissions
– One coal plant (500 MW, 80% CF) ~ 3-4 MMT CO2/yr.
• Depends on coal type, plant technology, heat rate
– Natural gas emits at ~ ½ intensity of coal
• LNG combustion can be ~50%-66% of CO2 intensity of coal, depending
on source and supply chain.
© 2008 Electric Power Research Institute, Inc. All rights reserved.
6
Presentation Objective…Answer Three Questions
• What is the technical potential for reducing
U.S. electric sector CO2 emissions?
• What are the economic impacts of different
technology strategies for reducing U.S.
electric sector CO2 emissions?
• What are the key technology challenges for
reducing electric sector CO2 emissions?
© 2008 Electric Power Research Institute, Inc. All rights reserved.
7
Representative U.S. Economy-Wide
CO2 Constraint
9
8
Starting Point is Current
Intensity Target
Billion Tons CO2 per year
7
• PRISM electric sector CO2
profile most closely modeled by
economy-wide constraint
which:
2010 Cap to 2020
6
−Caps emissions at 2010 levels
until 2020
5
−Requires 3% decline beginning
in 2020
4
3% decline
3
−37% of 2005 emissions levels
by 2050
2
1
0
2000
2010
2020
2030
© 2008 Electric Power Research Institute, Inc. All rights reserved.
2040
2050
8
Electricity Technology Scenarios
Full Portfolio
Limited Portfolio
Available
Unavailable
New Nuclear
Production Can
Expand
Existing Production
Levels ~100 GW
Renewables
Costs Decline
Costs Decline Slower
New Coal and Gas
Improvements
Improvements
Available
Unavailable
Accelerated
Improvements
Improvements
Supply-Side
Carbon Capture and
Storage (CCS)
Demand-Side
Plug-in Hybrid Electric
Vehicles (PHEV)
End-Use Efficiency
© 2008 Electric Power Research Institute, Inc. All rights reserved.
9
-1.5
Value of R&D Investment
© 2008 Electric Power Research Institute, Inc. All rights reserved.
10
Full Portfolio
Cost of
Policy
$1 Trillion
-1.0
+ CCS Only
+ Nuclear Only
+ Efficiency Only
+ Renewables Only
-0.5
+ PHEV Only
Change in GDP Discounted Through 2050
($Trillions)
0.0
Limited Portfolio
Full Technology Portfolio Reduces Costs of a
CO2 Emissions Reduction Policy by 60%
Reduction in
Policy Cost
with
Advanced
Technology
Wholesale Electricity Price
180
4.0
160
140
120
In the Full Portfolio the price of electricity
has a low CO2 cost component and
increases less
3.0
$/MWh*
2.5
100
Limited
2.0
80
1.5
Full
60
1.0
40
0.5
20
0
2000
2010
*Real (inflation-adjusted) 2000$
© 2008 Electric Power Research Institute, Inc. All rights reserved.
2020
2030
Year
11
2040
0.0
2050
Index Relative to Year 2000
3.5
U.S. Electric Generation – Limited Portfolio
With a less de-carbonized
supply, electricity load
must decline to meet the
CO2 emissions target
Biomass
Wind
Hydro
Nuclear
Gas (with half the CO2 of
coal) pays a significant
CO2 cost
Gas
Coal
© 2008 Electric Power Research Institute, Inc. All rights reserved.
12
U.S. Electric Generation – Full Portfolio
The vast majority of
electricity supply is CO2-free
Wind
Hydro
Gas and non-captured coal
are the only supply options
paying a CO2 cost
Nuclear
Gas
Public Policy (e.g. RPS) can
modify this economic
allocation
Coal with CCS
Coal
© 2008 Electric Power Research Institute, Inc. All rights reserved.
13
Increase in Real Electricity Prices…
2000 to 2050
+260%
+45%
Both Scenarios meet the same economy-wide CO2 Cap*
*Economy-wide CO2 emissions capped at 2010
levels until 2020 and then reduced at 3%/yr
© 2008 Electric Power Research Institute, Inc. All rights reserved.
14
Presentation Objective…Answer Three Questions
• What is the technical potential for reducing
U.S. electric sector CO2 emissions?
• What are the economic impacts of different
technology strategies for reducing U.S.
electric sector CO2 emissions?
• What are the key technology challenges for
reducing electric sector CO2 emissions?
© 2008 Electric Power Research Institute, Inc. All rights reserved.
15
Transition to Low-Emissions Technologies
• Enabling Efficiency, PHEVs, DER
via the Smart Distribution Grid
• Enabling Intermittent Renewables
via Advanced Transmission Grids
• Expanded Advanced Light Water
Reactor Deployment
• Advanced Coal Plants with CO2
Capture and Storage
© 2008 Electric Power Research Institute, Inc. All rights reserved.
16
RD&D is a Good Investment
Avoided Cost to U.S.
Economy
(2000-2050, present value in 2000 $)
$1,000B
$30B
RD&D Investment
(2005-2030, present value in 2000 $)
© 2008 Electric Power Research Institute, Inc. All rights reserved.
17
2008 EPRI Priority…Analysis to Action
Technology
Challenges
1. Enabling energy
efficiency with efficient
end-use technologies
and smart grids
2. Enabling intermittent
renewables with
advanced transmission
and energy storage
3. Deploying advanced
light water reactors
4. Deploying CCS by 2020
Demonstration
Projects
Hyper-efficient electric
end-use technologies
Smart grids
Compressed air energy
storage
PC with partial CCS
Two alternate capture
technologies
IGCC with partial CCS
Lower-cost O2
production
© 2008 Electric Power Research Institute, Inc. All rights reserved.
18
The Full Portfolio: Lower CO2, Lower Prices
+260%
+45%
Conclusions
• The potential to reduce emissions is there.
• Development of a Full Portfolio of technologies substantially lowers the
cost of reducing CO2 emissions and helps keep electricity affordable.
• Key technology challenges must be overcome to launch the Full Portfolio
of technologies.
• Demonstration projects are essential to launching technology.
*Economy-wide CO2 emissions capped at 2010
levels until 2020 and then reduced at 3%/yr
© 2008 Electric Power Research Institute, Inc. All rights reserved.
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Image courtesy of NASA Visible Earth