Nuclear Energy and Renewables: System Effects in Low-Carbon Electricity Systems

Transcription

1 Nuclear Energy and Renewables: System Effects in Lw-Carbn Electricity Systems Evidence frm a Recent NEA Publicatin Prf. Dr. Jan Hrst Keppler and Dr. Marc Cmett OECD Nuclear Energy Agency Nuclear Develpment Divisin

2 OECD NEA System Effects Study Overview 1. Interactin between variable renewables, nuclear pwer and the electricity system 2. Quantitative estimatin f system effects f different generating technlgies Csts impsed n the electricity system abve plantlevel csts Ttal system-csts in the lng-run Impact f intermittent renewables n nuclear energy and ther generatin surces 3. Institutinal framewrks, regulatin and plicy cnclusins t enhance the sustainability, flexibility and security f supply f pwer generatin and enable cexistence f renewables and nuclear pwer in decarbnising electricity systems 2

3 System Effects Study - Intrductin System csts are the ttal csts abve plant-level csts t supply electricity at a given lad and given level f security f supply. Plant-level csts Grid-level system effects (technical externalities) Grid cnnectin Grid-extensin and reinfrcement Shrt-term balancing csts Lng-term csts fr maintaining adequate back-up capacity Plant-level csts Grid-level csts Ttal system csts Impact n ther electricity prducers (pecuniary externalities) Reduced prices and lad factrs f cnventinal plants in the shrt-run Re-cnfiguratin f the electricity system in the lng-run Ttal system csts Take int accunt nt nly the csts but als the benefits f integrating new capacity (variable csts and fixed csts f new capacity that culd be displaced) Other externalities (envirnmental, security f supply, cst f accidents, ) 3

4 The Cntributin f Nuclear t Reduce System Effects In sme cuntries (France, Germany, Belgium) significant flexibility is required f NPPs: Primary and secndary frequency cntrl Daily and weekly lad-fllwing Gd lad-fllwing characteristics 0 N prven impacts n fuel failures and majr cmpnents Availability factr reductin due t extended maintenance ( %) Ecnmical cnsequences f lad-fllwing mainly due t reductin in lad factrs Nuclear fleet management Start-up Time Maximal change in 30 sec Maximum ramp rate (%/min) Open cycle gas turbine (OGT) min % 20 %/min Cmbined cycle gas turbine (CCGT) min % 5-10 %/min Cal plant 1-10 hurs 5-10 % 1-5 %/min Nuclear pwer plant 2 hurs - 2 days up t 5% 1-5 %/min Perfrming utages when electricity is less valuable minimises private and scial lsses Ecnmical benefit is in the range f USD/MWh (1-2% f LCOE) fr the whle nuclear park. Als reduces the residual demand balance and the need fr additinal capacity /07/ /08/ /10/ /12/ /01/ /03/ /05/ /06/ /08/2009 4

5 Assessing System Effects: The Shrt-Run and the Lng-Run Crucial imprtance f the time hrizn, when analyzing adequacy back-up csts and impacts n dispatchable generatrs (n issue fr grid csts r balancing csts): Adequacy and back-up csts : In the shrt run(ex pst),in a system where existing capacity reliably cvers peak demand, there are n back-up csts fr new variable renewable capacity. In the lng run (ex ante), variable renewable capacity due t its lw «capacity credit» demands dedicated back-up, which is nt cmmercially sustainable n its wn. Impacts n dispatchable generatrs In the shrt run,the pecuniary externalities f subsidized, variable renewables (reduced electricity prices and lad factrs) will ver-prprtinally affect technlgies with high fixed csts such as CCGTs. In the lng run, the structural re-cmpsitin f residual dispatchable capacity will ver-prprtinally affect technlgies with high fixed csts such as nuclear. Issue fr investrs and researchers: when des the shrt-run becme the lng-run? 5

6 The Shrt Run In the shrt-run, renewables with zer marginal csts replace technlgies with higher marginal csts, including nuclear as well as gas and cal plants. This means: Reductins in electricity prduced by dispatchable pwer plants (lwer lad factrs, cmpressin effect). Reductin in average electricity prices n whlesalepwer markets (by 13-14% and 23-33%) Lad lsses Prfitability lsses Gas Turbine (OCGT) -54% -40% -87% -51% Gas Turbine (CCGT) -34% -26% -71% -43% Cal -27% -28% -62% -44% Nuclear -4% -5% -20% -23% Gas Turbine (OCGT) -54% -40% -87% -51% Gas Turbine (CCGT) -42% -31% -79% -46% Cal -35% -30% -69% -46% Nuclear -24% -23% -55% -39% Electricity price variatin 10% Penetratin level 30% Penetratin level Tgether this means declining Wind Slar Wind Slar prfitability especially fr gas (nuclear less affected). Carbn emissins are reduced Security f supply risks as fssil plants clse (brne ut by reality, 30 GW in past tw years). -14% -13% -33% -23% Pwer (GW) Gas (OCGT): Lst lad Gas (CCGT): Lst lad Cal: Lst lad Nuclear: Lst lad Yearly Lad Residual lad Utilisatin time (hurs/year) 6

7 The Lng Run Renewable prductin will change generatin structure als fr back-up. Withut cuntervailing measures (carbn taxes), nuclear pwer will be displaced by a mre carbn-intensive mix f renewables and gas. Cst fr residual dispatchable lad will rise as mre expensive technlgies are used. N change in electricity prices fr penetratin levels < 25%. 7

8 Estimating Capacity Credit Capacity credit is calculated using cmplex prbabilistic techniques (LOLP) and requires a sphisticated mdeling f the electricity system. Residual lad duratin curves allw fr simple and reliable estimatin f the capacity credit 95 1 σ Dispatchable generatin capacity that can be effectively replaced (IEA). CC=5,9% Dispatchable generatin capacity that culd be Dispatchable replaced generatin based averaged capacity values. that culd be replaced based n averaged values. CC=5,8 GW / 77,9 GW = 7,5% Yearly Lad Curve Residual Yearly lad Lad curve Curve Residual lad curve Residual lad curve - Max Residual lad curve - Min Pwer (GW) 85 Pwer (GW) Residual lad curve crrespnding t a minimal wind prductin Residual lad curve crrespnding t a maximal wind prductin Utilisatin Utilisatin time time (hurs) (hurs) 8

9 Changes in the Optimal Generatin Mix: A Hidden System Cst Cmparisn f the residual lad duratin curve fr a 30% penetratin f fluctuating wind (blue curve) and 30% penetratin f a dispatchable technlgy(red curve) Wind surplus Wind shrtage Lad duratin curve Residual lad curve - wind Residual lad curve - dispatchable Pwer (GW) USD/MWh 81.8 USD/MWh = USD/MWh WIND 85.5 USD/MWh = +8.7 USD/MWh WIND Utilisatin time (hurs/year) 9

10 Declining Marginal Cntributin f VaRen t Cvering Electricity Demand The aut-crrelatin f VaREN prductin reduces the effective cntributin f variable resurces t cvering electricity demand. Grid parity based n plant-level cst n indicatr f csts fr equivalent cntributin t supply at the system level. 100% 100% 90% 90% Electricity value (% f a flat band) 80% 80% 70% 70% 60% 60% 50% 50% Electricity Electricity value - dispatchable value - dispatchable 40% 40% Electricity value - wind Electricity value - wind Marginal electricity value - wind 30% 30% Electricity Electricity value - slar value - slar 20% Marginal electricity value - slar 20% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 0% 5% 10% 15% 20% Penetratin 25% level 30% (%) 35% 40% 45% 50% Electricity value (% f a flat band) Penetratin level (%) The marginal value shuld be taken int accunt in investment decisin making! 10

11 Technlgy Ttal System Effects f Different Technlgies System Csts at the Grid Level (average f 6 cuntries - USD/MWh) Six cuntries, Finland, France, Germany, Krea, United Kingdm and USA analyzed Grid-level csts fr variable renewables at least ne level f magnitude higher than fr dispatchable technlgies Grid-level csts depend strngly n cuntry, cntext and penetratin level Grid-level csts are in the range f USD/MWh fr renewables (wind-n shre lwest, slar highest) Average grid-level csts in Eurpe abut 50% f plant-level csts f base-lad technlgy (33% in USA) Nuclear grid-level csts 1-3 USD/MWh Cal and gas USD/MWh. System Csts at the Grid Level [USD/M Wh] Nuclear Cal Gas On-shre wind Off-shre wind Slar Penetratin level 10% 30% 10% 30% 10% 30% 10% 30% 10% 30% 10% 30% Back-up Csts (Adequacy) Balancing Csts Grid Cnnectin Grid Reinfrcement and Extensin Ttal Grid-Level System Csts Ttal cst [USD/MWh] Grid-level system csts Plant-level csts 10% 30% 10% 30% 10% 30% 10% 30% 10% 30% 10% 30% Nuclear Cal Gas On-shre wind Off-shre wind Slar 11

12 Ttal Csts f Electricity Supply fr Different Renewables Scenaris Cmparing ttal annual supply csts f a reference scenari with nly dispatchable technlgies with six renewable scenaris (wind ON, wind OFF, slar at 10% and 30%) Takes int accunt als fixed and variable cst savings f displaced cnventinal PPs Germany UK USA Ttal cst f electricity supply [USD/MWh] Ref. Cnv. Mix 10% penetratin level 30% penetratin level Wind nshre Wind ffshre Slar Wind nshre Wind ffshre Ttal cst f electricity supply Increase in plant-level cst Grid-level system csts Cst increase Ttal cst f electricity supply Increase in plant-level cst Grid-level system csts Cst increase Ttal cst f electricity supply Increase in plant-level cst Grid-level system csts Cst increase Slar Ttal csts f renewables scenaris are large, especially at 30% penetratin levels: Plant-level cst f renewables still significantly higher than that f dispatchable technlgies. Grid-level system csts alne are large, representing up t 67% f the increase in unit electricity csts. 12

13 New Markets fr New Challenges The integratin f large amunts f variable generatin and the dislcatin it creates in electricity markets requires institutinal and regulatry respnses in at least three areas: A. Markets fr shrt-term flexibility prvisin Fr greater flexibility t guarantee cntinuus matching f demand and supply exist in principle fur ptins that shuld cmpete n cst: 1. Dispatchable back-up capacity and lad-fllwing 2. Electricity strage 3. Intercnnectins and market integratin 4. Demand side management S far dispatchable back-up remains cheapest. B. Mechanisms fr the lng-term prvisin f capacity There will always be mments when the wind des nt blw r the sun des nt shine. Capacity mechanisms (payments t dispatchable prducers r markets with supply bligatins fr all prviders) can assure prfitability even with reduced lad factrs and lwer prices. C. A Review f Supprt Mechanisms fr Renewable Energies Subsidising utput thrugh feed-in tariffs (FITs) in Eurpe r prductin tax credits (PTCs) in the United States incentivises prductin when electricity is nt needed (including negative prices). Feed-in premiums, capacity supprt r best a substantial carbn tax wuld be preferable. 13

14 Lessns Learnt and Plicy Cnclusins Lessns Learnt The integratin f large shares f intermittent renewable electricity is an imprtant challenge fr the electricity systems f OECD cuntries and fr dispatchable generatrs such as nuclear. Grid-level system csts fr variable renewables are large (15-80 USD/MWh) but depend n cuntry, cntext and technlgy (Wind ON < Wind OFF < Slar PV) Grid-level and ttal system cst increase ver-prprtinally with the share f variable renewables System effects f nuclear pwer exist but are mdest cmpared t thse f variable renewables Lwer lad factrs and lwer prices affect the ecnmics f dispatchable generatrs: difficulties in financing capacity t prvide shrt-term flexibility and lng-term adequacy need t be addressed. Plicy Cnclusins 1. Accunt fr system csts and ensure transparency f pwer generatin csts. 2. New regulatry framewrks are needed t minimize and internalize system effects. (1) Capacity payments r markets with capacity bligatins, (2) Oblige peratrs t feed stable hurly bands f capacity int the grid, (3) Allcate csts f grid cnnectin and extensin t generatrs, (4) Offer lng-term cntracts (cntracts fr difference, feed-in-tariffs) t dispatchable base-lad capacity. 3. Recgnize the rle f dispatchable lw-carbn technlgies such as nuclear 4. Develp flexibility resurces t enable the c-existence f nuclear and variable renewables in lw carbn electricity systems. 14