IPM Overview Elliot Lieberman U.S. Environmental Protection Agency Washington, D.C. 20460.
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Transcript of IPM Overview Elliot Lieberman U.S. Environmental Protection Agency Washington, D.C. 20460.
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IPM Overview
Elliot LiebermanU.S. Environmental Protection Agency
Washington, D.C. 20460
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Documentation on Web
www.epa.gov/airmarkets/epa-ipm
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What is IPM?
The Integrated Planning Model (IPM) is a tool developed by ICF Consulting and used by EPA for policy analysis.
IPM is a long-term capacity expansion and production costing model for analyzing the electric power sector.
It is a multi-regional, deterministic, dynamic linear programming model.
IPM finds the least-cost solution to meeting electricity demand subject to environmental, transmission, fuel, reserve margin, and other system operating constraints.
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Linear Program Advantages
Finds optimal solution
Comprehensive, integrated approach
Bottom-up detail
– Allows fine grain parameter variations
– Analysis based on detailed disaggregate information
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Typical IPM Constraints and Variables
Electricity Demand Constraints Reserve Margin Constraints Environmental Constraints Transmission Constraints Fuel Constraints Other Operational Constraints
Model plants– Existing Units
– Planned/Committed Units
– Potential Units
Retrofit options Repowerings and
retirements
140,225 Constraints 1,980,251 Variables
(x load segments x coal or fuel types x run years x seasons)
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Model Regions
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Reserve Margin Assumptions
Reserve margin is a measure of the system’s generating capability above the amount required to meet peak load requirements.
Planning Reserve Margins
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Generating Resources
Existing units Planned/committed units New potential units that the model can build Repowerings, relicensings, and retirements
Categories represented
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Potential Units
Pulverized Coal Integrated Gasification
Combined Cycle Combined Cycle Combustion Turbine Nuclear
Biomass Gasification Combined Cycle
Wind Solar Geothermal Landfill gas Fuel cells
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Emission Control Technologies
SO2 Scrubbers– Limestone Forced Oxidation (LSFO)
– Magnesium Enhanced Lime (MEL)
– Lime Spray Dryer (LSD)
NOx Post-Combustion Controls
– Selective Catalytic Reduction (SCR)
– Selective Non-catalytic Reduction (SNCR)
– Gas Reburn
Mercury Removal– Activated Carbon Injection (ACI)
– By-product of SO2, NOx, and particulate controls
Other– Combustion Optimization
– Biomass cofiring
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First Stage Retrofit Assignment Scheme in EPA Base Case 2000
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Run Year Mapping in EPA Base Case 2000
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Model Plant Aggregation
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Categories Used in Aggregation Scheme Model Region Unit Technology Type Fuel Demand Region Environmental Regulations
– NOx SIP Call Participation
– State Specific Regulations in CT, MO and TX State
– Texas– Connecticut– Missouri
Unit Configuration– Boiler Type– Firing Type
– SO2 Pollution Control
– NOx Pollution Control
– Particulate Matter Control Heat Rate
– Low Efficiency Group– Mid Efficiency Groups– High Efficiency Group
Size– Coal Steam Units
» Less than 25 MW» From 25 MW to less than 100 MW» 100 MW or greater
– Non-coal fossil units and other non-coal emitting units» Less 25 MW» 25 MW or greater
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Unit ID Capacity(MW)
Heat Rate(Btu/kWh)
NOx Rate(lbs/Mmbtu)
SO2 Rate(lbs/MMBtu)
Hg EMFBit
Hg EMFSub Bit
ExistingControls
Model Plant 11091_B_2 300 10475 0.46 0.84 0.6 0.85 Cold-side ESP
7343_B_4 624 10108 0.46 0.83 0.6 0.85 Cold-side ESP
Model Plant 22442_B_4 740 9661 0.46 0.47 0.05 0.3 Fabric Filter + Wet
Scrubber2442_B_5 740 9661 0.68 0.47 0.05 0.3 Fabric Filter + Wet
Scrubber
Model Plant 36082_B_1 675 9188 0.42 0.58 0.05 0.05 Cold-side ESP +
SCR + WetScrubber
Typical Model Plants
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Financial Assumptions
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Financial Assumptions
Discount Rate– Represents the time value of money– Allows for inter-temporal analysis
Capital Charge Rate– Allows annualized capital payments to be
calculated for an investment
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Discount Rate
Capital structure Pre-tax debt rate Post-tax equity rate
Key parameters considered:
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Capital Charge Rate
Capital structure Pre-tax debt rate (or interest cost) Debt life Post-tax return on equity Taxes and insurance Depreciation schedule Book life
Key parameters considered:
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Factors Affecting the FinancingOf Different Technologies
Risk profile– Medium risk– High risk
Financing scheme– Project financing– Corporate financing
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Capital Charge Rates and Discount Rates
Investment Technology
CapitalChargeRate*
DiscountRate
FinancingScheme
RiskProfile
Environmental Retrofits 12.0% 5.34% Corporate
MediumRepowering of Existing Units 12.9% 6.14%
Project
Coal (including IGCC) 12.9% 6.14%Combined Cycle 12.9% 6.14%Combustion Turbine 13.4% 6.74%
HighRenewable GenerationTechnologies 13.4% 6.74%
Advanced Nuclear 13.4% 6.74%*30-year book life assumed
Capital Charge Rates and Discount Rates
Investment Technology
CapitalChargeRate*
DiscountRate
FinancingScheme
RiskProfile
Environmental Retrofits 12.0% 5.34% Corporate
MediumRepowering of Existing Units 12.9% 6.14%
Project
Coal (including IGCC) 12.9% 6.14%Combined Cycle 12.9% 6.14%Combustion Turbine 13.4% 6.74%
HighRenewable GenerationTechnologies 13.4% 6.74%
Advanced Nuclear 13.4% 6.74%*30-year book life assumed