Europe's Coming Challenges in Meeting Decarbonisation Objectives · 2019. 11. 27. · – What...

© 2015 Electric Power Research Institute, Inc. All rights reserved.

Geoffrey J. Blanford, Ph.D.

EPRI-IEA Workshop on Challenges in Electric Sector Decarbonisation 28 September 2015, Paris

Europe’s Coming Challenges in Meeting Decarbonisation Objectives

2 © 2015 Electric Power Research Institute, Inc. All rights reserved.

EU electric sector will be driven by renewables

Many questions remain: – How far and how fast?

– What mix of wind and solar?

– What regional distribution?

– What technologies will balance the system?

Implications for conventional capacity: – How much currently installed fossil capacity is “slack”?

– What value will existing fleet provide in the future?

– What about new investments?

Depends on national policies vs. EU-wide implementation


Power Sector Under the EU-ETS

0

200

400

600

800

1000

1200

1400

2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Mill

ion

tons

CO

2

CCGT / GT

Hard Coal

Brown Coal

History

Cap

43%

80%

95%

Base Year Power Generation

Emissions (Modeled)

2005 level


EU-REGEN Model of Electricity Investment/Dispatch

Scandinavia

Great Britain

France

Iberia Italy

EE-SE EE-SW

EE-NW

EE-NE

Alpine

N Germany

S

Benelux

EE = Eastern Europe Net Transfer Capacities (ENTSO-E)

> 4 GW 2 - 4 GW 1 - 2 GW < 1 GW Planned

Jointly developed by EPRI and Ifo Institute, Munich

Intertemporal optimization through 2050

Detailed representation of renewable profiles


Renewable Resource Distribution Wind (on-shore) Solar

Based on MERRA reanalysis hourly dataset from US NASA, 1979-2013

30°E

60°N

50°N

40°N

Class 5Class 6

Class 1Class 2Class 3Class 4

70°N

10°W 0° 10°E 20°E 30°E

60°N

50°N

40°N

Class 5Class 6

Class 1Class 2Class 3Class 4

70°N

10°W 0° 10°E 20°E


Regional System Adequacy (one definition)

Market-clearing condition requires that supply equal demand in each segment/hour in each region:

We include an additional constraint that local available non-intermittent capacity must be sufficient to meet peak load:

Non-Intermittent Dispatch

VRE feed-in

Net Discharge from Storage = Load * (1 + loss) Net

Imports + + +

Non-Intermittent Available Capacity

Storage Discharge Capacity + = Peak * (1 + loss)


EU Generation Mix: 80% by 2050 Policy

0

1000

2000

3000

4000

5000

1990 2000 2010 2020 2030 2040 2050

TWh

CSP

PV

Wind

Gas-CCS

Gas/Oil

Coal-CCS

Hard Coal

Brown Coal

Nuclear

Bio-CCS

Bio+

CHP-Gas/Oil

Hydro

Least-cost emissions reductions: no additional national targets or

subsidies


EU Installed Capacity: 80% by 2050 Policy

0

200

400

600

800

1000

1200

1400

1600

2015 2020 2025 2030 2035 2040 2045 2050

GW

CSP

PV

Wind

Gas-CCS

Gas/Oil

Coal-CCS

Hard Coal

Brown Coal

Nuclear

Bio-CCS

Bio+

CHP-Gas/Oil

Hydro

Peak Load

Residual Peak


0

20

40

60

80

100

120

140

160

180

Lignite Hard Coal CCGT Other Gas/Oil

GW

EU Fossil Capacity 2015-2050

Installed

Retired Early

After initial adjustment, gas capacity does not retire early

Includes industrial

CHP, maintained throughout

Hard coal is retired before lignite

Some “slack” capacity in 2015 doesn’t cover fixed O&M


EU Cumulative New Capacity Investments

0

200

400

600

800

1000

1200

1400

2020 2025 2030 2035 2040 2045 2050

GW

CSP

PV

Wind (off-shore)

Wind (on-shore)

Nuclear

Bio-CCS

Biomass

Gas-CCS

GT

CCGT

Coal-CCS

Hard Coal


0

20

40

60

80

100

120

0% 20% 40% 60% 80% 100%

€pe

r MW

hEnergy-Only Price Distribution in EU, 2030

New CCGT

Existing CCGT

Hard Coal

Brown Coal

Dispatch Cost (including carbon price of €28/t) Range & average across regions/vintages


0

20

40

60

80

100

120

140

Existing CCGT Hard Coal New CCGT Brown Coal

€pe

r kW

-yea

r

Capacity

Energy

Net operating revenue from energy and capacity, 2030

Capacity payments required to cover

fixed O&M

Both sources cover investment and

fixed costs

Still deep in the money

(EU Average)

Fixed O&M


Conventional capacity under decarbonisation

Coal/lignite plants will inevitably scale down production However, generation falls faster than installed capacity

– Some units retire early, many stay online – Fewer hours, lower margins in energy market – Capacity payments are crucial for managing this transition

Natural gas capacity (both CCGT and GT) expand – Hours for CCGT increase, even with rising renewable share – Still, approximately half of new CCGT net operating revenue from

capacity payments

Nuclear declines overall, only grows in East CCS only plays role with 95% target, even then only with

bioenergy or gas – coal CCS is far out of the money


Important factors not modeled here = Ongoing research priorities

Operational constraints – Unit commitment, especially start-up and shut-down costs

– Voltage and frequency stabilisation, system inertia

Interaction with demand side – Changing end-use mix could significantly change load shape

– DSR may be a cost-effective contributor to capacity needs

Coupling with other sectors – Economics of CHP under carbon constraint

– “Power to X” technologies (e.g. hydrogen, heat)


EPRI Webinar on EU Electric Sector Scenarios

November 2015, TBC

Explore other results and scenarios with EU-REGEN, e.g. – Role of renewable technologies, national targets

– Transmission scenarios

– Regional details

– Storage

– Unit commitment constraints

See EPRI staff for more information


Together…Shaping the Future of Electricity


Extra Slides


Regional Generation Mix (TWh) (80% by 2050)

Britain Scandinavia EE (North)

Hydro CHP-Gas/Oil Bio+ Bio-CCS Nuclear Brown Coal Hard Coal Coal-CCS Gas/Oil Gas-CCS Wind PV CSP Energy for Load

0

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 20500

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 20500

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 2050


France Germany Benelux/Alpine


0

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 20500

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 20500

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 2050



Iberia Italy EE (South)


0

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 20500

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 20500

200

400

600

800

2015 2020 2025 2030 2035 2040 2045 2050



0

20

40

60

80

100

120

140

160

180

Lignite Hard Coal CCGT Other Gas/Oil

GW

Installed

Covers Fixed O&M

Covers Fixed O&Mwithout RSA Constraint

EU Fossil Capacity in 2015: Over-subscribed?

Model solution in 2015 finds some slack capacity: earnings don’t cover fixed

O&M

“slack” coal mainly in

Scandinavia, Eastern Europe

“slack” gas/oil in Britain, Iberia, Italy

Regional System Adequacy constraint implies higher capacity prices, less slack

22 GW 25 GW

32 GW


EU Average Full Load Hours by Technology

0

1000

2000

3000

4000

5000

6000

7000

8000

2015 2020 2025 2030 2035 2040 2045 2050

Full

Load

Hou

rs

Solar PV

Wind (on-shore)

Bio-CCS

Nuclear

CCGT

Hard Coal

Brown Coal


New CCGT is much lower in the stack

0

1000

2000

3000

4000

5000

6000

7000

8000

2015 2020 2025 2030 2035 2040 2045 2050

Full

Load

Hou

rs

Solar PV

Wind (on-shore)

Bio-CCS

Nuclear

CCGT

Hard Coal

Brown Coal

New CCGT

Existing CCGT


“Efficient” Role of Renewables in EU

Wind in North is most valuable renewable resource

Solar in South is competitive (with a carbon price) when costs are lower than: – ~1000 euro/kW for PV

– ~3000 euro/kW for CSP (with 2.5x solar multiplier)

Least-cost mix involves mainly on-shore wind in Britain, Scandinavia, France, and Baltic / North Sea coasts

Wind and solar reach maximum generation share ~33%

This mix could be superseded by national objectives

Europe's Coming Challenges in Meeting Decarbonisation Objectives · 2019. 11. 27. · – What...

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