Creating a Secure Low-Carbon Future

Secure Creating a Low-Carbon Future Revis James Director, Energy Technology Assessment Center October 16, 2009 Critical Conclusions • With achievement of aggressive but technically feasible levels of technology performance and deployment, annual U.S. electric sector CO2 emissions could be reduced by 41% by 2030. • An optimal technical and economic strategy is comprised of aggressive end-use efficiency and a diverse generation technology portfolio. – Ensures technological resiliency. – Lowers cost of emissions reductions by ~37%. • All technologies not yet ready - focused, sustained research, development and demonstration over the next 20 years is necessary. • Decarbonized electricity will be critical in reducing costs of reducing CO2 emissions from transportation and other economic sectors. © 2009 Electric Power Research Institute, Inc. All rights reserved. Presentation Overview The Technology Challenge De-carbonize the electricity infrastructure and meet binding economy-wide CO2 reduction targets Provide reliable, affordable, and environmentally responsible electricity Meeting The Challenge Technically feasible with a full portfolio of generation options Decisions Over the Next Decade will Shape the Electricity Future of 2050 © 2009 Electric Power Research Institute, Inc. All rights reserved. The CO2 Challenge 8 Assumed Economy-wide CO2 Reduction Target 7 6 Historical Emissions (with no international offsets) 2005 = 5982 mmT CO2 Billion tons CO2 5 4 3 2 1 Remainder of U.S. Economy 2030 = 42% below 2005 (3470 mmT CO2) 1017 mmT CO2 U.S. Electric Sector 2000 2010 2020 83% Reduction in CO2 emissions below 2005 0 1990 2030 2040 2050 © 2009 Electric Power Research Institute, Inc. All rights reserved. The Electricity Technology Challenge The Technology Challenge Meeting the Challenge © 2009 Electric Power Research Institute, Inc. All rights reserved. U. S. Electric Sector CO2 Emissions 3500 3000 2007 2008 2009 U.S. Electric Sector CO2 Emissions (million metric tons) EIA Base Case 2500 2000 1500 1000 500 0 1990 1995 2000 2005 2010 2015 2020 2025 2030 © 2009 Electric Power Research Institute, Inc. All rights reserved. Prism Technology Analysis Bottoms-up performance and cost analysis of key technology options to reduce electric sector CO2 emissions – Based on domain expert evaluation of feasible technology performance, deployment improvements – Performance and technology advancements Presumes sustained, successful RD&D Updated annually © 2009 Electric Power Research Institute, Inc. All rights reserved. 2009 Prism 3500 3000 2500 2000 1500 1000 Fossil Efficiency U.S. Electric Sector CO2 Emissions (million metric tons) 41% reduction in 2030 from 2005 level is technically feasible using a full portfolio of electric sector technologies Efficiency Technology Efficiency T&D Efficiency Renewables Nuclear EIA Base Case EPRI Prism Target Renewables Nuclear Fossil  Efficiency CCS Load Growth ~ 8% Additional Consumption Reduction by 2030 +0.95%/yr None 60 GWe by 2030 12.5 GWe New Build by 2030 40% New Coal, 54% New NGCCs by 2030 None 20% Reduction in T&D Losses by 2030 135 GWe by 2030 (15% of generation) No Retirements; 10 GWe New Build by 2020; 64 GWe New Build by 2030 +3% Efficiency for 75 GWe Existing Fleet 49% New Coal; 70% New NGCCs by 2030 90% Capture for New Coal + NGCC After 2020 Retrofits for 60 GWe Existing Fleet 41% 500 CCS 0 1990 1995 2000 2005 2010 2015 2020 2025 2030 © 2009 Electric Power Research Institute, Inc. All rights reserved. 2009 Prism – PEV and Electro-Technologies 3500 3000 2500 Renewables U.S. Electric Sector CO2 Emissions (million metric tons) Low-carbon generation enables electrification and CO2 reductions in other sectors of economy Efficiency 2000 1500 1000 500 0 1990 Technology Electric Transportation Electrotechnologies EIA AEO Base Case None None EPRI Prism Target PHEVs by 2010 40% New Vehicle Share by 2025 3x Current Non-Road Use by 2030 Replace ~4.5% Direct Fossil Use by 2030 Nuclear Fossil  Efficiency CCS PEV Electro‐ Technologies 1995 2000 2005 2010 2015 2020 2025 2030 © 2009 Electric Power Research Institute, Inc. All rights reserved. MERGE Economic Analysis Optimization Model of Economic Activity and Energy Use through 2050 – Maximize Economic Wealth Inputs – Energy Supply Technologies and Costs for Electric Generation and Non-Electric Energy Constraints – Greenhouse Gas Control Scenarios – Energy Resources Outputs – Economy-wide Impact of Technology and Carbon Constraints © 2009 Electric Power Research Institute, Inc. All rights reserved. MERGE U.S. Electric Generation Mix 7 6 Limited Portfolio Demand Reduction Full Portfolio Demand Reduction Biomass 7 6 5 5 Trillion kWh per year 4 Solar Hydro Nuclear Wind Hydro Gas Biomass Wind 4 3 3 Nuclear 2 2 Gas 1 Coal CCS Retrofit New Coal + CCS 1 Coal 0 2000 2010 2020 2030 2040 2050 2000 2010 2020 2030 2040 0 2050 © 2009 Electric Power Research Institute, Inc. All rights reserved. Trillion kWh per year Key Technology Portfolio Insights •Aggressive energy efficiency needed with either portfolio – 52% Increase in Demand Reduction with Limited Portfolio •Over 20% renewables generation share by 2030 with either portfolio – >50% renewables by 2050 with limited portfolio •If availability of new nuclear and CCS post 2020 uncertain, natural gas power production expands rapidly – Limited Portfolio – Gas Consumption Increases 275% from 2010 to 2050 © 2009 Electric Power Research Institute, Inc. All rights reserved. MERGE Wholesale Electricity Cost Results $220 $200 $180 $160 $/Mwh (2007$) $140 $120 $100 $80 $60 $40 $20 $0 2020 © 2009 Electric Power Research Institute, Inc. All rights reserved. Substantial increases in the cost of electricity 2050 Limited Portfolio Limited Portfolio Full Portfolio Full Portfolio 210% 80% 2007 U.S. Average Wholesale Electricity Cost 2007 U.S. Average Wholesale Electricity Cost 2030 2040 2050 MERGE De-carbonization Results 22 Wholesale Electricity Cost (2007 cents/kWh) MERGE Projections 2020-2050 20 18 16 14 12 10 8 6 4 2 0 0.70 2007 2020 2020 2020 2020 2050 2050 Limited Limited Portfolio High Cost to meet 2050 Reduction Portfolio Cost of Electricity Target with >80% Generation Mix Gas and Renewables 2040 2040 2030 2030 2030 2030 2040 2050 Full Portfolio Full Portfolio 0.60 0.50 0.40 0.30 0.20 Emissions Intensity (metric tons CO2 /MWh) De-Carbonization 0.10 0.00 © 2009 Electric Power Research Institute, Inc. All rights reserved. The Electricity Technology Challenge The Technology Challenge Meeting the Challenge © 2009 Electric Power Research Institute, Inc. All rights reserved. Meeting the Challenge $220 $200 $180 $160 $/Mwh (2007$) $140 $120 $100 $80 $60 $40 $20 $0 2020 © 2009 Electric Power Research Institute, Inc. All rights reserved. Technology Actions Based on Meeting the Limited Prism Technology Targets Portfolio RD&D and Deployment Challenge Limited Portfolio Full Portfolio Full Technology Innovation to De-carbonize While Achieving a Cost of Electricity Near Portfolio Today’s Level Innovation Challenge 2007 U.S. Average Wholesale Electricity Cost 2007 U.S. Average Wholesale Electricity Cost 2030 2040 2050 Conclusion 22 Wholesale Electricity Cost (2007 cents/kWh) MERGE Projections 2020-2050 20 Cost of Electricity Electricity policy and technology actions Limited 18 Portfolio over the next decade will toLimited a great extent Portfolio 16 2040 2040 shape the electricity future of 2050 14 12 10 8 6 4 2 0 0.70 2007 2020 2020 2020 2020 2030 2030 2030 2030 2040 2050 2050 2050 Full Portfolio Full Portfolio Which Future Are You Creating? 0.60 0.50 0.40 0.30 0.20 Emissions Intensity (metric tons CO2 /MWh) De-Carbonization 0.10 0.00 © 2009 Electric Power Research Institute, Inc. All rights reserved. © from NASA Visible Earth Image 2009 Electric Power Research Institute, Inc. All rights reserved. BACKUP SLIDES © 2009 Electric Power Research Institute, Inc. All rights reserved. MERGE Wholesale Electricity Cost Results $220 $200 $180 $160 $/Mwh (2007$) $140 $120 $100 $80 $60 $40 $20 $0 2020 © 2009 Electric Power Research Institute, Inc. All rights reserved. Substantial increases in the cost of electricity 2050 Limited Portfolio Limited Portfolio Full Portfolio Full Portfolio 173% 2007 U.S. Average Wholesale Electricity Cost 2030 2040 2050 Impact on U.S. Economy of Policy: 80% Below 1990 by 2050 0.0 -0.5 -1.0 -1.5 -2.0 -2.5 -3.0 -3.5 Advanced technologies without CCS or new Nuclear Cost of Policy Reduction in Policy Cost with Advanced Technology Value of R&D Investment © 2009 Electric Power Research Institute, Inc. All rights reserved.