Resource Adequacy in the Pacific Northwest: Serving Load Reliably under a Changing Resource Mix

Transcription

1 Resurce Adequacy in the Pacific Nrthwest: Serving Lad Reliably under a Changing Resurce Mix Significant greenhuse gas emissin reductins leading t a deeply decarbnized grid can be achieved as lng as sufficient firm capacity is available during perids f lw wind, slar and hydr prductin t maintain adequate Resurce Adequacy Natural gas generatin is the mst ecnmic surce f firm capacity and adding new gas capacity is nt incnsistent with lng-term carbn reductin Wind, slar, demand respnse and shrt-duratin energy strage can cntribute t maintaining Resurce Adequacy but have imprtant limitatins and diminishing returns in their ability t meet Nrthwest winter peak lads It wuld be extremely cstly and impractical t replace all firm generatin capacity with slar, wind and strage, due t the significant renewable verbuild and required transmissin cnstructin needed t maintain adequacy 100% Zer Carbn Results Frecasted 2050 Demand 54,000 MW Required Renewable Build 143,000 MW f wind/slar + 29,000 MW f 6-hr Strage Renewable Curtailment 47% f available renewable energy Additinal Cst ($/kwh) $52/MWh - $89/MWh* *2017 average retail rate in the Greater Nrthwest regin = $80/MWh (Surce: EIA) Renewable versupply becmes pervasive and cstly as the regin mves beynd a 90% reductin in electric sectr greenhuse gas emissins belw 1990 levels It is necessary t verbuild renewable generatin t assure enugh zer-carbn energy is prduced during lw generatin hurs and maintain Resurce Adequacy requirements The Nrthwest anticipates the need fr new firm generatin capacity in the near-term t maintain an acceptable level f Resurce Adequacy after planned cal retirements 8,000 MW f new firm capacity is needed by 2030 t meet lad grwth and replace retiring cal generatin (3,000 MW f retirements are planned by 2030) If all cal is retired in the regin, then 16,000 MW f new firm capacity wuld be required Investment in fuel delivery infrastructure may be needed t ensure generatin capacity is truly firm

2 Resurce Adequacy in the Pacific Nrthwest: Serving Lad Reliably under a Changing Resurce Mix Frequently Asked Questins What is the purpse f the Energy + Envirnmental Ecnmics study n resurce adequacy in the Nrthwest? The E3 Reliability study uses cmputer mdeling t determine hw the Nrthwest (Washingtn, Oregn, Idah and prtins f Mntana, Wyming and Utah) can serve electric lad reliably in 2030 and 2050 under carbn reductin scenaris. In this study, an electric generatin system is cnsidered t be reliable, r resurce adequate, when metrics indicate pwer shrtages will ccur fr less than ne day in 10 years, r 2.4 hurs per year. The scenaris illustrate hw much effective generating capacity is needed t achieve these metrics. Hw des this study differ frm the studies E3 cmpleted fr Public Generating Pl and Climate Slutins in ? The previus studies fcused n the cst f decarbnizing the Nrthwest grid but did nt clsely examine the issue f pwer system reliability. The previus studies utilized E3 s RESOLVE mdel an ptimal dispatch and capacity expansin mdel t develp least-cst prtflis f resurces t meet specified plicy gals ver time. The current study cnducts a detailed examinatin f lng-term reliability requirements under deep decarbnizatin using E3 s RECAP mdel, which was designed expressly fr this purpse. RECAP calculates generating resurce availability ver thusands f simulated years in rder t ensure a statistically representative set f results. What are the key findings f the E3 reliability study? The key findings are: 1. It is pssible t maintain Resurce Adequacy fr a deeply decarbnized Nrthwest electricity grid, as lng as sufficient firm capacity is available during perids f lw wind, slar and hydr prductin; 2. It wuld be extremely cstly and impractical t replace all carbn-emitting firm generatin capacity with slar, wind and strage, due t the very large quantities f these resurces and the assciated transmissin cnstructin that wuld be required; 3. The Nrthwest is anticipated t need new capacity in the near-term in rder t maintain an acceptable level f Resurce Adequacy after planned cal retirements; and 4. Current planning practices risk underinvestment in new capacity required t ensure Resurce Adequacy at acceptable levels. What are the limitatins t E3 s analysis relative t state plicy? The fcus f E3 s analysis is t understand hw energy plicies will affect resurce adequacy fr the entire Greater NW regin. Resurce adequacy is, t an extent, a reginal issue as all Nrthwest utilities are intercnnected and trade surplus energy and capacity with each ther. Hwever, individual utilities are ultimately respnsible fr ensuring resurce adequacy fr their wn systems, and cnclusins valid fr the brad regin may nt hld true fr individual utilities r states. In particular, the larger regin will likely require a lwer Planning Reserve Margin than individual utilities, due t diversity f bth electric lads and resurces acrss a brad gegraphy. In additin, the effective capacity cntributin f wind, slar and energy strage calculated by a mdel like RECAP will be different fr each utility system. Finally, it is imprtant t recgnize the cst f clean energy plicy will nt be brne equally acrss the regin. Utilities currently relying n 2

3 mre carbn-intensive prtflis will require mre investment and incur higher csts than utilities with relatively clean prtflis tday. Is it pssible t meet all f the regin s future electric pwer needs with renewables? It wuld be extremely cstly and impractical t replace all firm generatin capacity with slar, wind and strage, due t the very large quantities f these resurces that wuld be required. With current technlgy, the regin wuld need t build s much extra renewable generatin that nly half f the available energy culd be utilized. Withut thermal firm generatin capacity n the system, this verbuild f renewables is needed ensure that enugh energy is stred t prtect against multi-day events with high demand and lw wind, slar, and hydr prductin. Extreme levels f verbuild are required at the highest levels f decarbnizatin (95 100%). Reginal incremental csts becme ptentially significant in the 80 t 90% reductin scenaris. Annual renewable curtailment f between 4 and 10 percent fr these scenaris tend t lwer the value f incremental renewable generatin. In a 98% reductin scenari, a significant versupply results in 21% f available renewable generatin being curtailed. Incremental resurce csts als duble cmpared t the 90% reductin scenari. Remving the final 2% f carbn under a 100% reductin scenari requires an additinal $100 billin t $170 billin f investment, relative t the 98% reductin scenari. Under this scenari, nearly half f wind and slar generatin is wasted because it is nt needed t serve lad during mst hurs. What ther challenges des the 100% clean energy scenari present? The land use impacts f a 100% clean energy prtfli are significant. T maintain resurce adequacy, 97,000 MW f new wind and 46,000 MW f new slar are needed. This translates int abut 3 14 millin acres f land r 100 times the land mass f Prtland and Seattle cmbined. It is unclear whether there are enugh sites that are suitable fr that level f renewable energy develpment. Anther majr challenge is transmissin cnstructin and siting. Mst f the best wind and slar sites are lcated either in Mntana r Wyming (fr wind) r Suthern Idah and Utah (fr slar). Delivering energy frm 140,000 MW f wind and slar int lad centers wuld require dzens f new high vltage transmissin lines. Can clean resurces such as wind and slar cntribute t system resurce adequacy? Wind and slar energy can cntribute t resurce adequacy but have limitatins which must be taken int cnsideratin. Wind and slar pwer plants can prduce energy nly when the wind is blwing r the sun is shining. Hwever, high electricity demand events in the Nrthwest tend t ccur during the wintertime when histrically there is little sun r wind. The study estimates fr the cmbined nrthwest and muntain regin tday, 100 MW f wind wuld cntribute nly 7 MW f effective capacity, while 100 MW f slar wuld cntribute 12 MW f effective capacity. The study des find using a mre diverse prtfli f resurces, including wind resurces in Mntana and Wyming, wuld cntribute mre capacity value than tday s wind resurces that are largely lcated in the Clumbia Grge area. Under a mre diverse prtfli in 2050, 100 MW f wind and slar wuld each cntribute apprximately 20 MW f effective capacity. What rle can energy strage play tward meeting resurce adequacy needs? Energy strage can help meet resurce adequacy needs by charging with excess wind, slar, hydr r gas generatin and string the energy fr future use. Hwever, energy strage als has imprtant limitatins in the Nrthwest. First, it is challenging t maintain reliability during cld weather events since cld snaps tend t crrelate with lw wind and slar prductin that last fr several days and current battery technlgy s energy duratins are in the 4-10 hur range. Secnd, the Nrthwest already has a significant quantity f energy strage within the existing hydrpwer systems that can be deplyed during these multi-day events. This means that new energy strage systems with 4-10 hur duratin are nt as helpful in the Nrthwest as they are in ther regins that are less dependent n hydrpwer. The study des find that the first 2,000 MW f 6-hur energy strage wuld cntribute a significant amunt f capacity value, apprximately 1,400 MW. Beynd 2,000 MW, strage technlgy cntributes very little t resurce adequacy; the secnd 2,000 MW f 6-hur energy strage wuld cntribute nly 200 MW f effective capacity. 3

4 Hw sn will the Nrthwest need additinal firm generating capacity t meet electric lad reliably? The electric system will underg significant changes t its generatin mix due t increased penetratin f wind and slar and cal retirements. Tday s system relies n 24,000 megawatts (MW) f thermal generatin, including 11,000 MW f cal generatin. Currently, 3,000 MW f cal are slated fr retirement. By 2030, the system wuld need 8,000 MW f new capacity t replace retiring cal and meet the frecasted increase in demand. If all cal is retired by 2030, the system wuld need 16,000 MW f new capacity. While additinal wind, slar and energy strage culd cntribute during this time hrizn, much f this new capacity will need t be natural gas r dual-fuel generatin. Is building new natural gas generatin capacity cnsistent with lng-term deep decarbnizatin? Yes, large increases in wind and slar generatin prvide fr electric system decarbnizatin, hwever, this study shws resurce adequacy is maintained by utilizing natural gas generatin capacity during multi-day reliability events. In fact, even the 98% carbn reductin scenari has mre natural gas generating capacity than exists tday in the regin (14,000 MW f gas generatin capacity under the 98% carbn reductin scenari vs. 12,000 MW tday). What level f energy efficiency was assumed? The study s lad frecast reflects all cst-effective cnservatin identified by the Nrthwest Pwer and Cnservatin Cuncil s 7th Pwer Plan. The mdel des nt assume additinal energy efficiency that may becme cst-effective in a mre decarbnized electric sectr. Cnsistent with the 2017 results, it will be imprtant t identify the next generatin f energy efficiency measures. Did the demand frecast accunt fr increased demand frm electrificatin f ther sectrs? Electrificatin f hmes and vehicles is nly included t the extent that it is reflected in current lad grwth frecasts. Heavy electrificatin f buildings, vehicles, r industry wuld increase resurce adequacy requirements beynd what this study shws, resulting in additinal required resurces. Why are nuclear pwer and new hydr nt cnsidered as a firm capacity ptin in the analysis? The main purpse f the study was t evaluate the ptential ability and cntributin f traditinal renewables t meet the adequacy requirements f the system. Alternative slutins such as nuclear generatin, fssil generatin with carbn capture and sequestratin, ultra-lng duratin strage, and bigas may becme available during this time frame, hwever each faces significant technical challenges befre they can be deemed reliably available at scale. The study des include sensitivities n the rle f these alternative technlgies and finds that carbn-free baselad, such as small mdular reactrs, and bigas may have a useful rle t play in the future under a deeply decarbnized electricity system. Des this Reliability Analysis include all the within-hur flexibility, inertia and resiliency needed t assure reliable peratin f the electric system? This analysis fcused n Resurce Adequacy t ensure enugh resurces are built t meet the frecasted needs f the electric system. Other analysis is needed t cnfirm the flexibility and resiliency needs f the system. Hw was the need fr new transmissin t supprt resurces handled in this analysis? A $/MW transmissin cst was added t new resurces fr which existing transmissin is nt available. The study des nt estimate the amunt f new transmissin that wuld be needed, hwever it is likely that the energy prtfli selected fr 100% Zer Carbn scenari wuld require dzens f new high-vltage transmissin lines stretching acrss multiple states. Hw was the need fr new gas pipeline capacity handled in this analysis? This study assumes that all firm natural gas generating capacity has access t a firm, reliable fuel supply. Investment in fuel delivery capability may be required t ensure resurce adequacy with ptential ptins being new gas pipeline infrastructure r n-site fuel strage, including ptential dual-fuel capability. 4

5 Des the study differentiate between types f future required firm natural gas generating capacity? The tw primary ptins fr firm natural gas capacity are cmbined cycle units and cmbustin turbines. Cmbined cycle plants have slightly higher capital csts alng with slightly lwer perating csts and emissins. Because the firm natural gas generatin in a deeply decarbnized wrld wuld be utilized very infrequently, traditinal utility planning may preference cmbustin turbines fr their lw capital cst. Hwever, a regin that is heavily fcused n carbn reductins may be willing t incur the higher cst fr cmbined cycle units in rder t realize the assciated emissins benefits. Wh spnsred this study? This study was funded by Puget Sund Energy, Avista, NrthWestern Energy and the Public Generating Pl (PGP). PGP is a trade assciatin representing 10 cnsumer-wned utilities in Washingtn and Oregn. 5