GHG Emissions Quantification Resulting from Hydropower-based Electricity Trade and Market Analysis The Case of Quebec ( )

Transcription

1 GHG Emissions Quantification Resulting from Hydropower-based Electricity Trade and Market Analysis The Case of Quebec ( ) M. Ben Amor, Pierre Oliver Pineau, Caroline Gaudreault and Réjean Samson USAEE/IAEE's 29 th North American Meeting Calgary, October 16 th, 2010 A research unit of the

2 Electricity markets and trades The provincial production was almost entirely from hydro sources (94 %) Over the period: Total QC Export: 53.2 TWh Total QC Import: -16 TWh 2

3 Goal & Intended application Being a hydropower producer, Quebec exports to neighbours (relying more on GHG emitting fossil fuels) should avoid emissions: How to Quantify Electricity Trades Implications on GHG Emissions? How significant GHG gains are in the context of the Northeast American electricity market? What is the extent to which GHG quantification can be increased when indirect emissions are taken into account? Intended application: Provide a detailed case study on assessing marginal GHG emissions & to quantify credit resulting from electricity trade; To help such future analysis in other jurisdictions. 3

4 Estimation of trade-related GHG emissions

5 Matching of hourly transmissions data with hourly electricity market price OASIS website of Hydro- Quebec TransÉnergie Mwh Export/Import 5

6 Matching of hourly transmissions data with hourly electricity market price Hourly Ontario Energy Price (IESO) CAD$/MW h Export/Import MWh 6

7 Estimation of trade-related GHG emissions

8 Fuel cost estimation The importance of fuel costs resides in finding out the rank of plants in the merit order (i.e to-be-operated queue ).E.g.: Nuclear plants with high fixed costs and low fuel costs are operated first for base loads; Natural gas plants with low fixed costs and high fuel costs are operated last and mostly for peak loads. Fuel costs reflect its fuel market price and plant s efficiency (i.e. heat rate) (Harris, 2006; Tester et al., 2005) 8

9 Fuel cost estimation Heat Rate (Btu/kWh) 1. For Ontario & New Brunswick: Statistics Canada (Statistics Canada, 2008, 2009). 2.New England & New York: EIA electricity database (EIA, 2010).

10 Fuel cost estimation Heat Rate (Btu/kWh) 1. For Ontario & New Brunswick: Statistics Canada (Statistics Canada, 2008, 2009). 2.New England & New York: EIA electricity database (EIA, 2010). (US$/Btu) U.S. Energy Information Administration databases (EIA, 2010): 1.US$ per short tonne of coal; 2. US$ per thousand cubic feet of natural gas; 3. US$ barrel of oil converted

11 Estimation of trade-related GHG emissions

12 Identification of the marginal technology Marginal technology is defined as the last power plant in the meritorder of all power plants needed to meet electricity demand and which output varies with small changes in local market conditions:

13 Marginal electricity production technology identification Marginal technology in Quebec adjacent markets, % of hours during 2006, 2007 and 2008 Hydropower Coal Natural gas Oil Ontario Coal-fired generators are the most frequent market price setter 13

14 Marginal electricity production technology identification Marginal technology in Quebec adjacent markets, % of hours during 2006, 2007 and 2008 Hydropower Coal Natural gas Oil Ontario New Brunswick Coal-fired and natural gas generators are the most frequent market price setters 14

15 Marginal electricity production technology identification Marginal technology in Quebec adjacent markets, % of hours during 2006, 2007 and 2008 Hydropower Coal Natural gas Oil Ontario New Brunswick New England

16 Marginal electricity production technology identification Marginal technology in Quebec adjacent markets, % of hours during 2006, 2007 and 2008 Hydropower Coal Natural gas Oil Ontario New Brunswick New England New York

17 Estimation of trade-related GHG emissions

18 Estimation of GHG emission rates 1) Operation stage GHG emission rates (tonne CO2eq/MWh): New Brunswick and Ontario GHG emission rates by fuel type were obtained from Environment Canada and Statistics Canada; New York and New England were obtained using EIA state electricity data tables (EIA-767 and EIA-906). 2) Life cycle GHG emission rates: The ecoinvent Database V2.0 and the TRACI impact method were used for the estimation (Bare et al., 2003; Dones et al., 2007). 18

19 Estimation of trade-related GHG emissions

20 Grey Slide What are the Electricity Trades Implications on GHG Emissions?

21 Estimation of trade-related GHG emissions Operation stage GHG emissions Tonnes of CO2eq, Totals for Import Export Net (a) Ontario 3,697,029 1,721,401 1,975,627 New York 3,073,281 11,979,720-8,906,439 New England 1,154,396 21,420,142-20,265,746 New Brunswick 888,394 3,567,358-2,678,964 8,813,099 38,688,621-29,875,521 (a) Net= Export Import 21

22 Grey Slide How significant GHG gains are?

23 Significance of electrcity trade impact quantification Northeast American electricity market context Emissions in million tonnes (Environment Canada, 2008; NEB, 2009) Sector Total Total Net Trade GHG Impact Change New York(a,b) Total Emissions % Electric Power % Total Emissions % New England(a,b) Electric Power % New Brunswick Total Emissions % Electric Power % Ontario Total Emissions % 1.98 Electric Power % Quebec Total Emissions % Electric Power 3.57 (a) For missing 2008 values, the average of the two previous years was used. (b) Only CO 2 emissions are displayed in the case of New York and New England. 23

24 Grey Slide What about Indirect GHG emissions?

25 Estimation of trade-related GHG emissions Life cycle GHG emissions and increase % Tonnes of CO2eq, Totals for Import Export (b) Net Ontario (a) 4,605,283 (+25 %) 2,085,783 (+21 %) 2,519,499 (+28 %) New York 3,582,534 (+17 %) 14,918,371 (+25 %) -11,335,837 (+27 %) New England 1,346,128 (+17%) 26,285,148 (+23 %) -24,939,021 (+23 %) New Brunswick 1,091,145 (+23%) 4,532,021 (+27%) -3,440,876 (+28 %) 10,625,089 (+21 %) 47,821,323 (+24 %) -37,196,234 (+25 %) (a) % = indirect emissions/ direct emissions (b) Net= Export Import 25

26 Conclusion Environmental benefits of hydropower exports are considerable as long as they substitute coal- and natural gas-produced electricity. Electricity trade will also be significantly affected, as the cost of different production technologies will evolve according to their GHG emissions However, detailed GHG assessment of such electricity trade is missing from the literature. 26

27 Recommendations Such analysis has yet to be included in GHG inventories, but some jurisdictions, such as Massachusetts, have already taken some steps in this direction. Importance of harmonizing and integrating further electricity markets to avoid the proliferation of different regulatory practices which will decrease potential trade opportunities. 27

28 Acknowledgements /

29 Thank you

30 Capital costs are strongly affected by the plant size and type, and its construction time Fuel cost estimation Electricity generation costs include: O&M costs reflect the plant s complexity and material conditions Fuel costs reflect the plant s efficiency and its fuel market price