Is there a case for new pumped storage hydro in the UK? Tom Pendrey. British Hydropower Association Annual Conference November 2017

Transcription

1 Is there a case for new pumped storage hydro in the UK? Tom Pendrey British Hydropower Association Annual Conference November 2017

2 Content Economic Background The UK Grid PSH Capabilities & Value Added Other Options & Comparisons Market Mechanisms Closing Thoughts 28/11/2017 Mott MacDonald Presentation 2

3 Economic Background (1) Big PSH in UK built Climate Change Paris Agreement Privatisation 28/11/2017 Mott MacDonald Presentation 3

4 Economic Background (2) 28/11/2017 Mott MacDonald Presentation 4

5 The UK Grid (1) National Grid Future Energy Scenarios 28/11/2017 Mott MacDonald Presentation 5

6 The UK Grid (2) National Grid Rate of Change of Frequency Trajectory 28/11/2017 Mott MacDonald Presentation 6

7 The UK Grid (3) Forecast Energy Sources and CO 2 intensity 28/11/2017 Mott MacDonald Presentation 7

8 The UK Grid (4) PS existing and in advanced development Existing PSH Project Name Owner Location Output (MW) Storage (GWh) Dinorwig First Hydro Wales 1,720 ~ 9 Cruachan Scottish Power Scotland 440 ~8.8 Ffestiniog First Hydro Wales 360 ~1.5 Foyers SSE Scotland 300 ~ 6.8 PSH in Development (in the public domain) Project Name Developer Statues Output (MW) Storage (GWh) Coire Glass SSE Consented 600MW (Scoping 1,500MW) Glenmuckloch Buccleuch & Forsa Consented Up to 400MW ~1.7 Glyn Rhonwy Quarry Battery Co Consented 99.9MW ~0.6 Cruachan 2 Scottish Power Feasibility 400MW to 600MW TBC 30 28/11/2017 Mott MacDonald Presentation 8

9 Pumped Storage Hydro Capabilities and Value Added (1) Existing PSH Helping to create a lower carbon economy and power system with greater penetration of renewables Energy security, through facilitating more renewables, hence removing reliance on other sources Inertia, assisting with RoCoF and fault ride through capabilities, plus Black Start Fast response time, including spinning reserve, and short term operating reserve Other ancillary services Reactive power FFR and EFR Demand side management, particularly with variable speed 28/11/2017 Mott MacDonald Presentation 9

10 Pumped Storage Hydro Capabilities and Value Added (2) Demand (MW) Demand (MW), PSH Generation (MW) Pumped Storage Generation (MW) 28/11/2017 Mott MacDonald Presentation 10

11 Pumped Storage Hydro Capabilities and Value Added (3) Gridwatch Data 8 November 2016 day of highest imbalance pricing on record (> 1,500MWh) 7 Nov Nov 2016 Wind French Interconnector Solar PSH Demand (2 nd axis) CCGT (2 nd axis) CCGT tracks demand very closely Decreasing wind and sun on 8 th Fast injection first by interconnector then PSH when sun sets PSH tends to fill the gap variable wind and sun, in combination in interconnectors 28/11/2017 Mott MacDonald Presentation 11

12 Other Options and Comparisons (1) Costs (source: Carbon Trust) Bulk storage Distributed storage Interconnectors (following slide) Cost Savings (next slide) 28/11/2017 Mott MacDonald Presentation 12

13 Other Options and Comparisons (2) Interconnectors - Costs Plus plans for another at least another 6 GW: C&F mechanism? 28/11/2017 Mott MacDonald Presentation 13

14 Market Mechanisms Revenue Streams Electricity price arbitrage Embedded benefits (avoided TNUoS and DUoS system charges) Capacity Market (CM) and CM avoidance Ancillary Services, including FFR and EFR Barriers Mutual exclusivity of some revenues Short term contracts Externalities not monetised: Avoided network upgrades Inertia Short Term Operating Reserve and Fast Reserve Black Start 28/11/2017 Mott MacDonald Presentation 14

15 Other Options and Comparisons (3) Cost Savings (source: Carbon Trust) 28/11/2017 Mott MacDonald Presentation 15

16 Closing thoughts Main benefits of new PSH: Cost savings across the whole system Improve transition to low carbon economy Energy security System operability Despite the above, financial environment doesn t support new PSH PSH offers an good solution to the bulk energy storage Solutions could be implemented in cost-neutral ways, such as a Cap & Floor mechanism to give sufficient long-term revenue certainty to private sector 28/11/2017 Mott MacDonald Presentation 16

17 Thank you. Questions?