Preliminary findings and implications for Bio Energy. Bio Energy Australia Conference Sydney 21 November 2017

Transcription

1 Comparison of Dispatchable Renewable Electricity Generation Options Preliminary findings and implications for Bio Energy. Bio Energy Australia Conference Sydney 21 November 2017 Keith Lovegrove (ITP), Muriel Watt (ITP), Jay Rutovitz (ISF), Geoff James (ISF), David Leitch (ITK), Ben Elliston (ITP), Joe Wyder (ITP), Annie Ngo (ITP) study commissioned by the Australian Renewable Energy Agency

2 2 Planning for a changing electricity mix Old world New world We need the least cost mix

3 3 This study Looks at technology combinations from a whole of system viewpoint Examining individual technologies and combinations, to classify their characteristics, appropriate uses, costs and sensitivities in a transparent and consistent way Not a grid integration / NEM modelling exercise Not picking winners identifying choices. The results should inform future grid integration studies. The results should help inform rational debate and policy development

4 4 Technologies evaluated Utility scale Wind or PV generation or a grid sourced mix of two in combination with: Large network connected batteries Pumped hydro storage Hydrogen storage (electrolysers, fuel cells, and combustion) Behind the meter PV generation and batteries Bio Energy Anaerobic Digestion plus gas engine Combustion boiler plus steam turbine Concentrating solar power (CSP) with thermal storage Geothermal generation Representative technologies that are ready to be installed at utility scale

5 5 Tasks Developing Dispatchability Value and Service Options Collecting key cost and performance data. Determining plausible ranges for cost reduction projecting into the future. Development and analysis of a range of cost of establishment and cost of energy metrics. Development and analysis of a range of value and revenue generation metrics. Consideration of policy and regulatory implications of modelled outcomes.

6 6 Some key terms used rather loosely Dispatchable Can generate and raise or lower output on command from system operator Firm Can guarantee a level of reliable generation for a certain period Scheduled A generator with an aggregate nameplate capacity of 30 MW or more is usually classified as scheduled if it has appropriate equipment to participate in the central dispatch process managed by AEMO Flexible Can be called on whenever needed to respond to demand

7 7 Services from dispatchable generators Many different classifications and levels of detail.. Sending out electricity when most needed Short term smoothing of wind and PV Longer term firming and extending wind and solar Targeting peak demand periods Providing ancillary services (frequency, blackstart etc) Supporting system security (inertia, fault current) Supporting transmission and distribution networks

8 8 Wind or solar based Generation Power level VRE Generation (cheapest) Time of Day

9 9 Wind or solar based Generation Add some energy storage for: Power level Immediately firm Time of Day

10 10 Wind or solar based Generation Add more energy storage for: Power level Extended firm Time of Day

11 11 Wind or solar based Generation Add more energy storage for: Power level Immediately firm plus: Fully flexible Time of Day

12 12 Bio Energy based Generation Continuously available resource means: Power level Fully firm continuous generation Time of Day

13 13 Bio Energy based Generation Power level Or choose to reduce capacity factor to target high demand periods: Firm and Fully flexible Time of Day

14 14 Hypothesis Continuing to grow VRE penetration until: There is significant curtailment There are persistent periods of very low or negative spot prices Short term energy storage becomes mandatory for system security Is probably not cost optimal A likely suboptimal outcome could follow: Continuing to reward all renewable MWhs equally as high penetrations are reached Trying to pick a precise specification of required electrical storage Over investing in a single technology solution

15 15 Putting them together Fully flexible Demand Power level Extended firm VRE Immediate firm Time of Day

16 Levelised Cost calculations are valuable cost per unit energy by amortisation of capital investment over the project lifetime, plus O&M costs and the cost of any inputs. If Cashflows are simple, no tax and a single discount / interest rate: Fixed O&M Capital cost Cost per unit of input energy LCOE F R PF c fixed C OM variable cin Nameplate power capacity Annual average capacity factor Variable O&M Conversion efficiency Capital recovery factor: F R n DR DR n DR Discount rate 16

17 17 Beware comparing apples with oranges Continuous generation Peaking Variable Dispatchable renewable but only one configuration

18 Our installed cost model combines subsystems 18 Collection: Cost / MW of output capacity Initial conversion: Cost / MW of output capacity Storage: Cost / MWh of capacity Final Conversion: Cost / MW of output capacity n Cost(capacity x) = Cost capacity y x y Where: x - plant capacity of interest y - base case plant capacity n - between 1 (modular) and 0.7 (strong economy of scale)

19 19 Subsystems for Bio cases Anaerobic Digestion plus gas engine: Waste at 0$/GJ $1.42m/ MW th Gas $12,400 / MWh th Gas engine $0.91m/ MW e, Ƞ=34% Dry Biomass plus combustion boiler and steam turbine: Dry Biomass at $5 /GJ = $18/MWh th +/- na Depot $7/ MWh th Boiler plus $4.89m/ MW e, Ƞ=24%

20 Bio Energy results Preliminary results subject to revision AD Biomass/ gas engine Combustion / steam turbine $5/GJ Combustion / steam turbine $2.5/GJ 50 MW Biomass combustion / steam turbine, 10MW AD / gas engine 7.8% WACC Configure for flexible / peaking 20

21 21 Bio Energy & the competition Wind and solar driven systems at 100MW output 7.8% WACC Preliminary results subject to revision

22 22 Bio specific observations Bio Energy electricity LCOE s are lowest for continuous generation Running at 50% capacity factor increases LCOE but provides very competitive fully flexible generation Bio Energy ticks the boxes of; synchronous generation, inherent inertia, fault current capability Cost of Biomass for combustion is critical Dry Biomass in a stockpile is a cost effective strategic reserve (although it will require additional management techniques) More complex and advanced combinations likely to be even more competitive, eg: Gasification plus combined cycle for higher efficiency Combined heat and power systems with two revenue streams

23 23 Conclusions Australia and the world s electricity needs to be 100% zero emissions by 2050 for <2 o C We have multiple affordable options for firm and flexible renewable generation over all time scales to balance lower cost variable PV and Wind A mix of technologies, configurations for duration and geographical locations is likely to minimise to overall average cost of electricity. Pursuing a range of dispatchable RE options now maximises the chance of a least cost transition. A well designed NEG could send the market signals needed.