Oklahoma Energy Planning

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University of Oklahoma School of Chemical, Biological, and Materials Engineering. Oklahoma Energy Planning. Modeling the Future Energy Demands of Oklahoma. - PowerPoint PPT Presentation

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Oklahoma Energy Planning

Mode l ing the Fu tu re Ene rgy Demands o f Ok lahoma

University of Oklahoma School of Chemical, Biological, and Materials Engineering

Vu Le Joseph Nick

So what is our project all about?

Dirty Energy Clean Energy

How much will it cost energy companies?

How much will it cost Oklahoman’s?

What can the government do to foster the much needed transition?

Modeling the Future Energy Demands of Oklahoma

Dirty Energy Clean Energy

• High CO2 emissions

• Fossil Fuel derived

• CHEAP

• Low CO2 emissions

• Sustainable energy

• Currently expensive• Compared to Dirty energy

Just how Dirty are we talking?

Oklahoma’s Current Electricity

Oklahoma’s Current Transportation Fuels

Oklahoma total CO2 emissions from fossil fuels

Coal fired plants have the highest amount of CO2 emissions for any power plant

Over 215 bi l l ion pounds of CO2 every year!!

52% from coal fired plants Less than 1% from Bio-fuels

Cost model - predict the optimal yearly energy use in Oklahoma, by

industry, so as to minimize total energy costs (net present cost) while

reducing carbon dioxide emissions and increasing total job salaries paid in

Oklahoma to specified levels.

ObjectiveThe objective of this project is to create mathematical models that will be used to plan Oklahoma’s move toward cleaner energy through the year 2030.

Profit model - predict the optimal yearly energy use in Oklahoma, by

industry, so as to maximize total profitability, net present value. Utility

pricing decisions and government tax incentives will be researched and

their effect on overall profitability will be characterized.

Develop Cost model

Develop Profit model

Model all energy used in Oklahoma from 2010 - 2030

Project goals

Easy enough r ight??

1/14/2004

5/28/2005

10/10/2006

2/22/2008

7/6/2009

0

1

2

3

4

5U.S. gas and crude oil prices 2005-

current

Gas Prices (2005-current) Crude oil spot price

($$

/gal)

Forecasted U.S. natural gas consumption data – available Forecasted Okla. natural gas consumption data – not available

Oil Refinery’s Revenues• Vary month to month & year to

year• Vary from refinery to refinery• Each one produces different products

How accurate are forecasted

commodity prices?

Assumptions, Approximations, and Estimations

Location is not considered

Constant operation cost for plants and refineries

Switchgrass used as ethanol feedstock

Soybean used as biodiesel feedstock

Construction times for new plants

◦ Wind – 1 year

◦ Everything else – 3 years

Assumptions

Energy Types

• Residential

• Commercial

• Industrial

• Plant

• Gasoline and Diesel

• Biodiesel

• Ethanol

• Coal-fired plants

• Natural gas fired

plants

• Hydroelectric plants

• Wind farms

Fuels

Electricity

Heating

Research

Past data

Present data

Projected data

• Energy Information Administration

• U.S. Department of Energy

• Oklahoma Wind Power Initiative

• Oklahoma Renewable Energy Council

Some forecasted data was readily available, while other data had to be independently forecasted by us.

Research

Total cost of energy Total carbon dioxide emissions Total Revenues Total salaries paid to Oklahoma workers

• Number of existing plants (by type)• Capacity of existing plants

• Total plant operating hours

• Plant CO2 emissions

• Current fuel prices

• Forecasted energy supply (by type)

• Forecasted energy demand (by type)

• Forecasted fuel prices

• Cost of building new plants

Examples of required data in calculating:

Electricity

Fig.1 A coal fired power plant Fig.2 Repower wind turbines Fig. 3 A hydroelectric Dam

Coal and natural gas plants Hydroelectric plants and Wind farms

Electric Energy Comparison

Comparison of coal & natural gas plants to wind & hydroelectric plants

Fuel Type

Current Capacity

(MW)Emissions

(lb. CO2/MWh)

Approx Total yearly

Emissions(lb. CO2/ yr) Pros Cons

Coal 5,362 2,300 ~ 75 billion -High existing capacity

-Cheap energy

-Enormous CO2 emissions

-Contributes greatly to global warmingNat. gas 12,883 960 ~2.6 billion

Wind 689 negligible negligible-Nearly zero

emissions

- Low O&M costs (esp. wind)

-Sustainable energy source

-Low existing capacity

-High capital costs for new plants/farmHydro 1,110

negligible negligible

Transportation Fuels

Gasoline and Diesel

(Crude Oil Refineries)

Biodiesel and Ethanol Refineries

Canadian Sand Oil Field Sunflower field, Biodiesel production

Switch grass field, Ethanol production

Fuels Comparison

Biofuels vs. Petroleum Fuels

Fuel FeedstockCapacity

(bbl/d)

RefiningEmissions(ton CO2/

bbl)

Net Emissions

(kg CO2/MJ) Pros Cons

Gasoline

Oil

240,000 0.407 94

-High existing cap.-Currently cheaper

-High emissions-Non sustainable

Diesel 200,000 0.102 83

Ethanol Biomass 130 0.466 -24(switchgrass)

-Sustainable energy-Reduces CO2 in 2

ways1. Crops absorb

CO22. Less CO2

produced in refining

-Low existing cap. this means

high costs of new plants

-Lower energy per vol. than

diesel

Biodiesel

Vegetable oil &

animal fat2,600 0.100 ~ 43

Fig. The CO2 cycle of ethanol production

Ethanol

Cellulosic biomass (switchgrass)

cellulose

fermentation

sugars

ETHANOL

enzymatic breakdown & pyrolysis

processing

Heating

(Clockwise from bottom left)

Residential- Household use

Industrial- Heat, power, and chemical feedstock use

Commercial- Use by non-manufacturing establishments

Plant- Fuel use in N.G. processing plants

Natural Gas Electricity

Natural Gas

Oklahoma Natural Gas Consumption (2007)

Type Consumption (MMcf)

Consumption (GJ)

CO2 Emissions(billion lbs/yr)

% of total use

Residential 59,842 63,254,185 11.17 17.4

Industrial 175,881185,909,869 32.87

51.2

Commercial 40,849 43,178,730 7.64 11.9

Plant 66,441 70,229,810 12.52 19.5

Total 343,015 362,572,594 64.2 100

Various estimates place natural gas at 75-90% of total heating (all sectors)

Cost Model Operation

Total Cost ‘i’ = (Fixed Opr. Cost) + (Var. Opr. Cost) + (Fuel Cost) +

(Capital Cost) + (Expansion Cost) + (Transportation Cost) + (E Carbon Capture Cost)

[(Fixed Opr. Cost) + (Var. Opr. Cost) + (Fuel Cost) + (N Carbon Capture Cost New)] new

Electricity Heating Fuels

Cost Model Operation

o CO2 emissions

o Fuel costo New plant capital cost

Each energy type has varying data for:

o Existing capacityo Future demando Job salaries creation

Increased demand New plants

Lower CO2 emissions Energy types with lower emissions or Carbon capture

More job salaries Choose energy with most jobs

Minimize Cost Choose most cost effective energy

Operating Costs

For both fuels and electricity, these costs were approximated as:

Cost = X ∙ Capacity -or-

Cost = X ∙ Fuel Used Where X is a function of the energy type.

Fixed operating and maintenance (Fixed O&M) costs

Salaries Wind farm lease payments Insurance payments

Variable operating and maintenance (Var. O&M) costs

Raw material costs Utility payments

Fuel costs

Fuels Crude Oil, Switchgrass, SoybeanElectricity Coal, Natural Gas

Fixed Operating Cost

The Fixed and Variable O&M costs for all 9 energy types were not readily available from one source.

Examples of organization and company websites were used to locate our O&M cost data

Energy and Environmental Economies Incorporated

Energy Information Administration

U.S. Department of Agriculture

American Wind Energy Association

Baker & O’Brien Incorporated

Resource Dynamic Corporation

Documented, credible sources.

Capital Cost

Capital costs are the costs of building new plants or expanding existing plants.

Cost = ( X ∙ Capacity ) + Y

Unlike fixed and variable O&M costs, capital costs have a minimum associated cost and thus can not be approximated as easily.

What to do? Analyze data from previous plant constructions and plant expansions

Electricity Capital Cost

Data we were able to find made no distinctions between electricity plant fuel sources (coal, natural gas, etc)

Not including hydro-electric and wind energy

Unlike fuels, new electricity plants can be built and are not limited to expansions

Minimum cost for new coal and NG plant

construction, regardless of capacity ~ 259 million

0 200 400 600 800 1000 1200 1400 1600 18000

200

400

600

800

1000

1200

1400

1600

1800

f(x) = 0.874639830017284 x + 259.267080190175

Electricity Plant Capacity vs. Capital Cost

Coal plants capacity vs. capital cost

Linear (Coal plants capacity vs. capital cost)

Capacity (MW)

Capit

al C

ost

(M

illions$

)

Wind Capital Cost

There is no minimum installed capital cost for new wind energy operations

Capital cost is a function of capacity

where X is the average installed cost per MW

Installed cost = 1,750,000 $ MW

Cost = X ∙ capacity

Job Salary Creation

Total Salary = Existing Salaries (2009) + New Salaries

New Salaries = New Operation Salaries + New Construction Salaries

Operation Salaries = Wages paid to engineers and employees who work to operate and maintain energy creation facilities Example: Plant managers, plant engineers, plant operators, etc

Construction Salaries = Wages paid to engineers and employees who work in constructing new energy creation facilities Example: Construction engineers, construction workers, transportation drivers

We are evaluating job creation in the state of Oklahoma using total wages paid to Oklahoma workers yearly

Construction Salary

From Perry’s Chemical Engineers’ Handbook

Plant construction costs as % of total plant installation cost (total capital)

Construction Labor Expenses 34%

Construction Material Expenses 66%

Total Expenses (total capital cost) 100%

New Operation Salary

0 5000000 10000000 15000000 20000000 250000000

20

40

60

80

100

120

140

160

180

f(x) = 3.6502267039919E-06 x + 98.5401165586337

Series1Power (Series1)Series3Linear (Series3)Linear (Series3)

Plant Capacity (kg/day)

Ope

ratin

g La

bor

(em

ploy

ee H

ours

)

[1] Convert our capacity data into kg / day

[2] Estimate the number of process steps involved

[3] Calculate salary paid from employee hours per day

required

The following graph was constructed using data from DESIGN, figure 6-9

Calculate average refinery employee’s salaryEngineers vs. non-engineer workers

Profit Model Operation

Electricity Heating Fuels

o Operation Costs

o New plant capital cost

Each energy type has varying data for:

o CCS cost

Profitability

Explored different scenarios for:

Tax breaks • New sustainable energy types• Carbon Capture, existing plants• Job creation

Emissions and job creation

Minimum price to consumers to meet specified return on investment

o Revenues

Algebraic Model

ValuePresent Net maximize Objective

n

t

n

t

n

tt

Heatt

t

Fuelt

t

Electt

i)(1

Profit) (Annual

i)(1

Profit) (Annual

i)(1

Profit) (Annual ValuePresent Net

Indices◦ t time period (yrs)

◦ i Individual boiler or refinery◦ j Fuel type (i.e. coal/natural gas)

  Sets

◦ new New plants or refineries

◦ Electric, Fuel, Heat

Algebraic Model

Algebraic Model

FuelNew,t

Fuelt

FuelNew,t

FuelNew,t

FuelNew,t

FuelNew,t

FuelNew,t

FuelNew,t

Fuelt

Fuelt

Fuelt

Fuelt

tureCost)(CarbonCaptureCost)(CarbonCap (FuelCost)t)(VarOprCosost)(FixedOprC

ionCost)(TransportCost)(Expansionst)(CapitalCo (FuelCost)t)(VarOprCosost)(FixedOprC Cost) (Total

FuelNew,t

Fuelt

FuelNew,t

FuelNew,t

FuelNew,t

FuelNew,t

FuelNew,t

FuelNew,t

Fuelt

Fuelt

Fuelt

Fuelt

tureCost)(CarbonCaptureCost)(CarbonCap (FuelCost)t)(VarOprCosost)(FixedOprC

ionCost)(TransportCost)(Expansionst)(CapitalCo (FuelCost)t)(VarOprCosost)(FixedOprC Cost) (Total

Heatt

Heatt

Heatt t)(VarOprCosost)(FixedOprC Cost) (Total

Algebraic Model (Electricity)

i j

New,Electijt

New,Electijt

New,Electijt

i j

Electijt

Electijt

Electijt

i

ElectNewt

j

ElectNewijt

ElectNewij

ElectNewijt

i

ElectNewt

j

ElectNewijt

ElectNewijt

ElectNewijt

i j

ElectNewijt

ElectNewijt

ElectNewijt

i j

ElectNewijt

ElectNewijt

i

Electt

j

Electijt

Electij

Electit

i

Electt

j

Electijt

Electijt

i j

Electijt

EεQ

EεQ

PEGU

PEV

zF

WyCS

PEGU

PEV

F

ˆtureCost)(CarbonCap

ˆtureCost)(CarbonCap

ˆ(FuelCost)

ˆprCost)(VariableO

ˆost)(FixedOprC

ˆˆtalCost)(FixedCapi

ˆ(FuelCost)

ˆt)(VarOprCos

ost)(FixedOprC

ElectricNew,t

Electrict

,,,,ElectNew,t

,,,ElectNew,t

,,ElectNew,t

,,,,ElectNew,t

Electt

Electt

Electt

Algebraic Model (Fuel+Heat)

Fuelt

Fuelijt

i j

Fuelij

Fuelij

refineriesoili oilj

FuelNewijt

FuelNewijt

FuelNewijt

FuelNewijt

FuelNewijt

FuelNewijt

i j

FuelNewijt

FuelNewijt

i

Fuelt

j

Fuelijt

Fuelit

i

Fuelt

j

Fuelijt

Fuelijt

i j

Fuelijt

PBTruckCapMileageostTruckFuelCledMilesTrave

WyCS

WyCS

PBU

PBV

F

ˆationCost)(Transport

ˆCost)(Expansion

ˆtalCost)(FixedCapi

ˆ(FuelCost)

ˆt)(VarOprCos

ost)(FixedOprC

Fuelt

,,,,FuelNew,t

,,,,FuelNew,t

Fuelt

Fuelt

Fuelt

i j

FuelNewijt

FuelNewijt

FuelNewijt

i j

Fuelijt

Fuelijt

Fuelijt

Fuelt

FuelNewijt

i j

Fuelij

Fuelij

i

Fuelt

j

FuelNewijt

Fuelit

i

Fuelt

j

FuelNewijt

FuelNewit

FuelNewijt

i j

FuelNewijt

BQ

BQ

PBTruckCapMileageostTruckFuelCledMilesTrave

PBU

PBV

zF

,,,FuelNew,t

Fuelt

,FuelNew,t

,FuelNew,t

,,FuelNew,t

,,FuelNew,t

ˆtureCost)(CarbonCap

ˆtureCost)(CarbonCap

ˆationCost)(Transport

ˆ(FuelCost)

ˆt)(VarOprCos

ˆost)(FixedOprC

j

FuelNewijt

Fuelit

FuelNewit

j

Fuelijt

Fuelit

Fuelit

BkE

BkE

,, ˆ

ˆ

FuelNewijtMax

FuelNewijt

FuelNewijt

FuelNewijtMin

FuelNewijt

ElectNewijtMax

ElectNewijt

ElectNewijt

ElectNewijtMin

ElectNewijt

n

t

FuelNewijt

n

t

ElectNewijt

yCCyC

yCCyC

y

y

,,,,,

,,,,,

,

,

ˆ

ˆ

1

1

i j

Heatijtijt

i jijt

EV

F

ˆt)(VarOprCos

ost)(FixedOprC

HeatHeatt

HeatHeatt

Algebraic Model (Profit)

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijtElectNew,

ijt

Electt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

ElectNew,ijt

,,,ElectNew,t

Profit Gross BreaksTax

Profit Gross(TaxRate) Taxes

tureCost)(CarbonCap

(FuelCost)t)(VarOprCosost)(FixedOprCostOperationC

onDepreciati

PriceratedEnergyGene Revenue

ostOperationConDepreciatiRevenue Profit Gross

BreaksTax TaxesProfit Gross Profit Annual

m

FCI

i j

ElectNewijt

i j

ElectNewijt

i j

ElectNewijt

*only new and electric plants are shown

Energy Generated must equal Demand

Model Constraints

Heatt

Heat

Heatt

Fuelt

Fuel

Fuelt

Electrict

Electric

Electrict

ndEnergyDema ratedTotalEnergyGene

ndEnergyDema ratedTotalEnergyGene

ndEnergyDema ratedTotalEnergyGene

Net CO2 Emission must be reduced by a preset limit

Model Constraints

tHeat

Heatt

Fuel

Fuelt

Elect

Electt LimitCO EmissionNetCOEmissionNetCOEmissionNetCO )2(222

Fuelt

,Fuelt

Fuelt

Electt

,Electt

Electt

Fuelt

,,Electrict

Fuelt

Fuelt

Fuelt

Electrict

Electrict

Electrict

dCO2ProducedCO2ProduceCO2Removed

dCO2ProducedCO2ProduceCO2Removed

ˆˆ dCO2Produce

ˆˆ dCO2Produce

CO2Removed-dCO2Produce sionNetCO2Emis

CO2Removed-dCO2Produce sionNetCO2Emis

FuelNewijt

Fuelijt

ElectNewijt

Electijt

Fuelt

New,Electijt

New,Fuelijt

Fuelt

Electijt

Fuelijt

Electt

ElectNewijt

ElectNewijt

Electt

Electijt

Electijt

PEγPEγ

PEPE

Energy Generated must be less than capacity

Model Constraints

SoybeanSoybean

sSwitchgrassSwitchgras

Heatijt

Heatijt

Fuelijt

Fuelijt

Electricij

Electricijt

itAnnual Lim BitAnnual LimB

CE

CB

CE

ˆ ˆ

ˆˆ

ˆˆ

ˆˆ

Job Creation in Salary must increase by a preset limit

Model Constraints

i

Fuelt

i

Fuelt

i

Fuelt

i

Electrict

i

Electrict

i

Electrict

Electrict

i

Fuelt

i

Electrict

OperationonConstructi NewSalary

OperationonConstructi NewSalary

imitNewSalaryL NewSalary NewSalary

Annual profits from new plants and refineries must exceed a set ROI.

Model Constraints

tElect New,

ijtElect New,

ijFuel New,

t

tElect New,

ijtElect New,

ijElect New,

t

)()(Profit) (Annual

)()(Profit) (Annual

t i j

t i j

FCIROI

FCIROI

Operation Cost Electricity Industry Transportation Fuel Natural Gas Heating CO2 Reduction Job Salary Profitability

3200 Lines of Codes ~ 2 min to run

GAMS Code Model

GAMS Code (Fuel Model)

GAMS Code (Profitability)

GAMS Code (Fuel Model)GAMS Code (Fuel Model)

Pareto-optimal Boundary

0.0

%

0.2

%

0.4

%

0.6

%

0.8

%

1.0

%

1.2

%

1.4

%

1.6

%

1.8

%

2.0

%

2.2

%

57.0

58.0

59.0

60.0

61.0

62.0

63.0

64.0

65.0

0.0%0.2%

0.4%0.6%

0.8%1.0%

1.2%1.4%

1.6%1.8%

2.0%

NPV vs CO2 vs Salary

0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%

Minimum CO2 Emission Annual Percent Reduction

Net

Pre

sent

Valu

e (

Billions D

ollars

)

Minimum Job Salary Creation Annual Percent Increase - ROI at 10%

- Tax break at 10% _of gross profit- Avg Electricity _Price at $0.10/KWh

0.0

%

0.2

%

0.4

%

0.6

%

0.8

%

1.0

%

1.2

%

1.4

%

1.6

%

1.8

%

2.0

%

2.2

%

57.0

58.0

59.0

60.0

61.0

62.0

63.0

64.0

65.0

0.0%0.2%

0.4%0.6%

0.8%1.0%

1.2%1.4%

1.6%1.8%

2.0%

NPV vs CO2 vs Salary

0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%

Minimum CO2 Emission Annual Percent Reduction

Net

Pre

sent

Valu

e (

Billions D

ollars

)

Minimum Job Salary Creation Annual Percent Increase - ROI at 10%

- Tax break at 10% _of gross profit- Avg Electricity _Price at $0.10/KWh

This surface represent the maximum NPV possible at a certain CO2 limit and Job creation for all industries combined.

Pareto-optimal

Boundary

0.0

%

0.2

%

0.4

%

0.6

%

0.8

%

1.0

%

1.2

%

1.4

%

1.6

%

1.8

%

2.0

%

2.2

%

57.0

58.0

59.0

60.0

61.0

62.0

63.0

64.0

65.0

0.0%0.2%

0.4%0.6%

0.8%1.0%

1.2%1.4%

1.6%1.8%

2.0%

NPV vs CO2 vs Salary

0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%

Minimum CO2 Emission Annual Percent Reduction

Net

Pre

sent

Valu

e (

Billions D

ollars

)

Minimum Job Salary Creation Annual Percent Increase - ROI at 10%

- Tax break at 10% _of gross profit- Avg Electricity _Price at $0.10/KWh

Job salary creation has a minor effect on NPV CO2 reduction has a major effect on NPV After 2% CO2 reduction, more carbon capture technology is used. - Primary reason for the steeper slope

Pareto-optimal

Boundary

Minimum Retail Electricity Price

*Jobs at 1%

    Tax Breaks (percent of profit)

CO2 ROI 0% 10% 20% 30%

0.0% 2.5% N/A $ 0.05 $ 0.05 $ 0.05

0.0% 5.0% N/A $ 0.07 $ 0.07 $ 0.06

0.0% 7.5% N/A $ 0.09 $ 0.08 $ 0.08

0.0% 10.0% N/A $ 0.10 $ 0.09 $ 0.09

1.0% 2.5% N/A $ 0.06 $ 0.06 $ 0.06

1.0% 5.0% N/A $ 0.07 $ 0.07 $ 0.06

1.0% 7.5% N/A $ 0.09 $ 0.08 $ 0.08

1.0% 10.0% N/A $ 0.10 $ 0.10 $ 0.09

2.0% 2.5% N/A $ 0.07 $ 0.07 $ 0.07

2.0% 5.0% N/A $ 0.07 $ 0.07 $ 0.07

2.0% 7.5% N/A $ 0.09 $ 0.08 $ 0.08

2.0% 10.0% N/A $ 0.10 $ 0.10 $ 0.09

Minimum Retail Electricity Price

*Jobs at 1%

This table shows the minimum average electricity price _require to make a profit.

Investors will not invests in new plants with no tax break

    Tax Breaks (percent of profit) CO2 ROI 0% 10% 20% 30%0.0% 2.5% N/A $ 0.05 $ 0.05 $ 0.05

0.0% 5.0% N/A $ 0.07 $ 0.07 $ 0.06

0.0% 7.5% N/A $ 0.09 $ 0.08 $ 0.08

0.0% 10.0% N/A $ 0.10 $ 0.09 $ 0.09

1.0% 2.5% N/A $ 0.06 $ 0.06 $ 0.06

1.0% 5.0% N/A $ 0.07 $ 0.07 $ 0.06

1.0% 7.5% N/A $ 0.09 $ 0.08 $ 0.08

1.0% 10.0% N/A $ 0.10 $ 0.10 $ 0.09

2.0% 2.5% N/A $ 0.07 $ 0.07 $ 0.07

2.0% 5.0% N/A $ 0.07 $ 0.07 $ 0.07

2.0% 7.5% N/A $ 0.09 $ 0.08 $ 0.08

2.0% 10.0% N/A $ 0.10 $ 0.10 $ 0.09

4 Scenario will be presented:

Retail Price of Electricity at 10 cent/KWH ROI at 10%

Scenarios

CO2 Jobs Tax Breaks

S1 0% 0% 10%

S2 1% 1% 10%

S3 2.2% 2% 10%

S4 1% 1% 20%

New Wind and Hydro-plants

New hydro-plant capacity by scenario (MW)Plants 2010 2013 2014 2017 2020 2024 2025 2026 Total

0% CO2, 0% Jobs, 10% Tax Break

3 121 400 357 678

1% CO2, 1% Jobs, 10% Tax Break

4 121 400 50 345 916

2.2% CO2, 2% Jobs, 10% Tax Break

5 119 181 400 384 400 1484

1% CO2, 1% Jobs, 20% Tax Break

5 180 357 376 119 50 1083

New Wind Capacity by scenario (MW)Plant

s 2011 2012 2013 2014 2016 2018 2020 2022 2025 2026 Total0% CO2, 0% Jobs, 10% Tax Break

5 119 195 238 237 357 1147

1% CO2, 1% Jobs, 10% Tax Break

5 119 305 253 440 500 1617

2.2% CO2, 2% Jobs, 10% Tax Break

5 17 247 227 500 500 1492

1% CO2, 1% Jobs, 20% Tax Break

5 119 119 119 457 457 1271

New Wind and Hydro-plants

New hydro-plant capacity by scenario (MW)

Plants 2010 2013 2014 2017 2020 2024 2025 2026 Total

0% CO2, 0% Jobs, 10% Tax Break

3 121 400 357 678

1% CO2, 1% Jobs, 10% Tax Break

4 121 400 50 345 916

2.2% CO2, 2% Jobs, 10% Tax Break

5 119 181 400 384 400 1484

1% CO2, 1% Jobs, 20% Tax Break

5 180 357 376 119 50 1083

New Wind Capacity by scenario (MW)

Plants 2011 2012 2013 2014 2016 2018 2020 2022 2025 2026 Total

0% CO2, 0% Jobs, 10% Tax Break

5 119 195 238 237 357 1147

1% CO2, 1% Jobs, 10% Tax Break

5 119 305 253 440 500 1617

2.2% CO2, 2% Jobs, 10% Tax Break

5 17 247 227 500 500 1492

1% CO2, 1% Jobs, 20% Tax Break

5 119 119 119 457 457 1271

At low CO2 reduction and Job creation, wind plants are favored At high CO2 reduction and Job creation, either plants are favored equally At high CO2 reduction, plants should be built at a later time No biodiesel and ethanol refineries are built

New Plants and Refineries

0% CO2, 0% Jobs,

10% Tax Break

1% CO2, 1% Jobs,

10% Tax Break

2.2% CO2, 2% Jobs,

10% Tax Break

1% CO2, 1% Jobs,

20% Tax Break

# of Wind Plant 5 farms 5 farms 5 farms 5 farms

Total Capacity 1147 MW 1617 MW 1492 MW 1271 MW

# of Hydroelectric 3 plants 4 plants 5 plants 5 plants

Total Capacity 678 MW 916 MW 1484 MW 1083 MW

Avg ROI 9.6% 10.1% 10.1% 10.2%

Std Deviation 2.0% 2.4% 2.7% 2.3%

New Plants and Refineries

For all four scenarios, a 10% annual ROI is possible with a standard deviation ranging from 2.0%-2.7%.

0% CO2, 0% Jobs,

10% Tax Break

1% CO2, 1% Jobs, 10% Tax

Break

2.2% CO2, 2% Jobs,

10% Tax Break

1% CO2, 1% Jobs,

20% Tax Break# of Wind

Plant 5 farms 5 farms 5 farms 5 farms

Total Capacity 1147 MW 1617 MW 1492 MW 1271 MW

# of Hydroelectric 3 plants 4 plants 5 plants 5 plants

Total Capacity 678 MW 916 MW 1484 MW 1083 MW

Avg ROI 9.6% 10.1% 10.1% 10.2%

Std Deviation 2.0% 2.4% 2.7% 2.3%

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Operation Construction

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New Salaries

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Operation Construction

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Operation Construction

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Operation Construction

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Operation Construction

New

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New Salaries These graphs show the job creation represented by salary - Construction labor - Operation labor

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Operation Construction

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Operation Construction

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Operation Construction

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Operation Construction

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Low operation labor due to wind farms and hydroelectric plants - Require less people to operate compared to coal and natural gas

New Salaries

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2.2% CO2, 2% Jobs, 10% Tax Break

Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

w (

bil

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ns)

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Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

w (

bil

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Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

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bil

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1% CO2, 1% Jobs, 10% Tax Break

Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

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Annual Cash Flow

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Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

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Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

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bil

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Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

w (

bil

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Electric Fuel Natural Gas New Electric New Fuel

Cash

Flo

w (

bil

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Higher CO2 reduction limit results in less profit for the electric industry - This is due to the cost of CO2 capture - Primarily from coal plants

Annual Cash Flow

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New Electric New Fuel

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Cash

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New Electric New Fuel

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New Electric New Fuel

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il-

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Discounted Cash Flow at 8%

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New Electric New Fuel

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Profit decreases as the CO2 limit and job creation increases

Result is similar for all scenarios under a 2% CO2 reduction

Larger then 2% reduction, the model chose to build plants later

- Compensate by using a lot more CCS

Discounted Cash

Flow at 8%

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Electric Industry Fuel Industry Natural Gas Industry

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Electric Industry Fuel Industry Natural Gas Industry

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Net CO2 Emission after CCS

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12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

1% CO2, 1% Jobs, 10% Tax Break

Electric Industry Fuel Industry Natural Gas Industry

Net

CO

2 E

mis

sio

n

(mil

lio

n t

on

s)

These tables include CO2 emissions from plants and refineries and from consumers

Majority of CO2 emissions from plants and refineries are from electric plants.

- Reduction is mostly from electric plants

Net CO2 Emission

after CCS

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

2.2% CO2, 2% Jobs, 10% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

20

25

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

0% CO2, 0% Jobs, 10% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1% CO2, 1% Jobs, 10% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1% CO2, 1% Jobs, 20% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

CO2 Emissions Captured with CCS

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

2.2% CO2, 2% Jobs, 10% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

20

25

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

0% CO2, 0% Jobs, 10% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1% CO2, 1% Jobs, 10% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1% CO2, 1% Jobs, 20% Tax Break

Coal Natural Gas Oil Biodiesel Ethanol

CO

2 R

em

oved

(m

illl

ion

to

ns)

Use of CCS increases with the CO2 limit - Almost all from coal plants before 2% After 2% reduction, more CCS use from natural gas plants are done. Minor CCS usage from oil refineries

CO2 Emissions Captured with CCS

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

2.2% CO2, 2% Jobs, 10% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n (

tho

usan

d M

W)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

1% CO2, 1% Jobs, 20% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n

(th

ou

san

d M

W)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

0% CO2, 0% Jobs, 10% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n (

tho

usan

d M

W)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

1% CO2, 1% Jobs, 10% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n (

tho

usan

d M

W)

Electricity Generation

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

2.2% CO2, 2% Jobs, 10% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n (

tho

usan

d M

W)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

1% CO2, 1% Jobs, 20% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n

(th

ou

san

d M

W)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

0% CO2, 0% Jobs, 10% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n (

tho

usan

d M

W)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

1

2

3

4

5

6

7

8

9

10

1% CO2, 1% Jobs, 10% Tax Break

Coal Natural Gas Wind Hydroelectric

Gen

era

tio

n (

tho

usan

d M

W)

No change in generation from coal and natural gas plants Generation from wind and hydroelectric plants shown to steadily increase - 24% wind by 2030 - 15% hydroelectric by 2030

Electricity

Generation

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

1% CO2, 1% Jobs, 20% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

0% CO2, 0% Jobs, 10% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

1% CO2, 1% Jobs, 10% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

2.2% CO2, 2% Jobs, 10% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

Transportation Fuel Production

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

1% CO2, 1% Jobs, 20% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

0% CO2, 0% Jobs, 10% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

1% CO2, 1% Jobs, 10% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

20

19

20

20

20

21

20

22

20

23

20

24

20

25

20

26

20

27

20

28

20

29

20

30

0

50

100

150

200

250

2.2% CO2, 2% Jobs, 10% Tax Break

Gasoline Diesel BioDiesel Ethanol

Tra

nsp

ort

aio

n F

uel

(th

ou

san

d

bb

l/d

ay)

Transportation fuel industry is shown to remain virtually unchanged

Transportation Fuel

Production

Any Questions?

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