Some possible frameworks for assessing The potential for, and … jury... · for, and barriers to, development of alternative forms of energy generation (eg: tidal, geothermal) in

Some possible frameworks for assessing The potential

for, and barriers to, development of alternative forms of

energy generation (eg: tidal, geothermal) in NSW

Iain MacGill Associate Professor, School of Electrical Engineering and Telecommunications Joint Director (Engineering), CEEM

NSW Citizens Deliberation for

the NSW PAC Inquiry

Sydney, Tamworth, Darwin

June 2012

2

NSW & the Australian National Electricity Market

QLD: Av. load 6GW

Gen Capacity 13GW

NSW: Av. load 9GW

Gen Capacity 17GW

SA: Av. load 1.5GW

Gen Capacity 4.5GW

VIC: Av. load 6GW

Gen Capacity 11GW

TAS: Av. load 1.2GW

Gen Capacity 3GW

The Australian

National

Electricity

Market

(AEMO, 2010)

3

Electricity Generation types in NSW, NEM

(AER, State of the Energy Market 2011) • Historical choices of

generation a result of

– available resources

– Available technologies

– Available infrastructure

– Active policy efforts

NSW Citizens Deliberation - frameworks for our energy options

4

However, electricity generation mix very different

(ESAA, Submission to Inquiry, 2012)

• Generation mix a

result of available

plant yet also:

– Fuel and operating

costs – coal generally

20-50% price of gas

– Available ‘fuel’ supply

the key issue for

hydro, wind


5

New NEM generation capacity over last decade

(AER, State of the Energy Market 2011)

• Significant, and driven by range of factors

– Peak demand growth (particularly peaking gas plant)

– Energy consumption growth (particularly coal in Qld)

– Renewable energy policy (wind), gas policy (Qld).... future policy issues?

– Replacement of old plant? (doesn’t appear to be major factor)


…and some recent surprises (APVA, 2012)

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Cu

mu

lati

ve k

W

off-grid domestic off-grid non-domestic grid-connected distributed grid-connected power stations

NSW Citizens Deliberation - frameworks for our energy options 6

Australian PV deployment becoming significant

High recent growth in PV deployment – almost all residential systems

Other technologies ‘missing’ from standard statistics - Cogeneration

7

(IPART, Report for PV Inquiry, 2011)

NSW generation mix compared with NEM, World

• Differences an outcome of differing

– resource endowments

– Infrastructure choices

– policy priorities and priorities

NSW Citizens Deliberation - frameworks for our energy options 8 (ANA, Submission to Inquiry, 2012)

… and some recent global surprises

9

(IEA, Energy Technology Perspectives, 2012)

10 NSW

Citizens

Deliber

ation -

framew

orks for

our

energy

options

Solar thermal concentrators for electricity generation(www.greenpeace.org)

• Some promising but still emerging

technologies now being deployed

in the US, Europe

11 NSW

Citizens

Deliber

ation -

framew

orks for

our

energy

options

Geothermal energy - radioactive rock

(www.greenhouse.gov.au)

A growing amount of conventional ‘geothermal’ in suita le countries

including NZ, Italy, Indonesia, Philippines

Australia has plentiful radioactive rock but requires novel technologies to

tap Trials underway in places including Cooper Basin, SA

New efforts to tap cooler but more usefully located

resources eg. Hunter Valley, Latrobe Valley

12 NSW

Citizens

Deliber

ation -

framew

orks for

our

energy

options

Other possible technologies: Tidal energy

• A number of existing plants and more planned

• Considerable technology, economic challenges


13 NSW

Citizens

Deliber

ation -

framew

orks for

our

energy

options

Other possible technologies: Wave energy

• Wave energy derives from

wind energy:

– Energy density varies

dramatically

• Need strength to survive

storms yet cheap & sensitive

enough to produce energy

from small waves

• Considerable progress but

still under development


Other possible options – Carbon Capture & Storage

14

• Extensive experience with injecting CO2 to enhance recovery from depleting oil reservoirs

• Limited experience with injecting CO2 to extract coal bed methane

• Limited experience with saline aquifers (several projects in Norway)

(IEA, 2001)



How much of which options maximises our

chances of success in meeting societal objectives,

and

how best to drive such changes?

…. is the engineering and policy and, most

importantly, societal challenge for sustainable

energy

Future choices start with trends … shaped by

earlier energy policies … and emerging issues

16 NSW Citizens Deliberation - frameworks for our

energy options

(World Energy Council, 2010)

Current Australian energy policy objectives

NSW

Citizens

Deliber

ation -

framew

orks for

our

energy

options

Possible policy implications: Where are the formal

affordability policies, climate and other environ-

mental objectives must join the queue

17

International Energy Agency Perspective



Possible framework for assessing Electricity Options

Their likely ability to contribute to large, rapid and

sustained global environmental impact reductions while

maintaining energy security and other desired

sustainability outcomes

Key factors in assessing their likelihood in contributing

to these sustainability objectives

• Local, regional, national resource endowments

• Technical status

• Environmental benefits and costs

• Integration into existing electricity industry infrastructure

• Present costs where known – + possible future costs

• Potential scale and speed of deployment

• Societal benefits and costs

19 NSW Citizens Deliberation - frameworks for our energy options

Australia’s

many

energy

options Fossil fuels (other

than oil) Uranium,

virtually all

renewables

Nice to have but

do increase

challenges of

decision making

in some regards

20

(Geoscience Australia, 2010)


Technology status

• With regard to Australian context ,note estimated status of Coal CCS,

Engineered geothermal Systems (EGS) (includes hot rock, sedimentary

aquifer), Ocean, switching from coal to gas CCGT & Cogen

21


One view

on current

abatement

options (FAR WGIII, 2007)


… and

possible

abatement

options

later (FAR WGIII, 2007)


Environmental benefits and costs

• Water use

• Regional air pollutants

• Land-use impacts

• Biodiversity impacts

• Visual amenity, noise

• Climate change – Need to consider both operating but also lifecycle emissions for

each technology… caution required with estimates due to

significant assumptions required


25 (ATSE, 2010)


Integration potentially challenging with some resources

(LBL/DOE, Wind Technologies Market Report, 2011)

26

eg. Transmission requirements, highly variable and somewhat

unpredictable generation, additional infrastructure needs for CCS

Note that wind (& now PV) becoming significant energy contributors in

some countries (and South Australia) and integration challenges to

date have been manageable

27

Care required with cost estimates

(EPRI, 2010)

eg. don’t put mature commercial technologies on same graph as still

unproven technologies without making the difference in $ estimations

Such cost estimates also require many assumptions – who makes

these, and with what transparency?

And prices can change rapidly eg. Australian home PV Grid System Price Trend (APVA 2012)

0

2

4

6

8

10

12

14

16

$/W

p

Current A$ (no RECs)


Our Options – Costs... now and future Energy Efficiency Many options offer net cost savings independent of

abatement value, distributed benefits

Renewables ‘new’ biomass + wind costs generally falling but still

significantly more expensive than conventional

options, high uncertainty for emerging technologies

Integration costs may be significant

Lower emm fossil-

fuel techs

Costs of gas plant very dependent on gas prices –

considerable uncertainty on these prices. Some

challenges integrating cogen. Future of CSM in NSW

and Qld a key issue here

Nuclear Very difficult to fully cost. Emerging designs promise

cost reductions.

Carbon Capture +

Storage

CCS for electricity generation has highly uncertain +

potentially variable costs depending on capture +

sequestration. Some potential for cost reductions

with learning (as with many emerging technologies) 29


Our Options – Potential Scale Energy Efficiency Potentially very large (Factor 4, Factor 10), but inherently

limited + competing against econ. growth

Renewables Most individual technologies limited by available fuel supply

(hydro, biomass) or face important intermittency issues

(wind, PV). In combination, however, potentially large. High

present uncertainty for geothermal.

Lower emm fossil-

fuel techs

Potential for CCGT driven by likely available gas supplies

(possible issues in Eastern Australia with CSM) although

world now finding more gas, CHP has high penetrations

(40%) in some countries but not here

Nuclear Potentially very large but there are some questions of

longer-term uranium supply. Thorium option?

Carbon Capture +

Storage

Potentially very large, although difficult to estimate given

present uncertainties on long-term storage – particularly in

saline aquifers & coal seams 30

Our Options – Potential Speed of

Deployment

Energy Efficiency Some options can be rapidly deployed, others have

longer capital stock turnover (eg. house construction)

Renewables Key technologies including Wind and PV growing fast

from relatively small base. Some other technologies

still requiring successful demonstration

Lower emm fossil-

fuel techs

Very fast for CCGT and fast for cogen – well

established technologies backed by large industries

Nuclear Long lead and build times – unlikely in Australia

before 2025. Requires major institutional capacity

Carbon Capture +

Storage

Technologies for electricity generation still not

demonstrated, institutional capacity and social

acceptance still key issues 31 NSW Citizens Deliberation - frameworks for our energy options

Our Options – Other Societal Outcomes Energy Efficiency Very promising employment + investment

opportunities. Low societal risks, no env. Impacts.

High energy security value.

Renewables Promising employment + investment opportunities,

including regional areas for many techs. Some env.

impacts for some techs – eg. biomass. Land-use

issues for wind. High energy security value

Lower emm fossil-

fuel techs

A range of direct air, water + land env. impacts with

fossil fuels. Energy security a possible issue with

gas for many countries, coal with some countries

Nuclear Fraught!

Carbon Capture +

Storage

Direct env. risks from sudden or slow escape of CO2

to atmosphere or ground waters. Coal an important

contributor to Aust. economy + high energy security 32

Barriers and policy needs

• Some global perspectives such as IEA

• However, issues are very context specific



IEA perspective on global clean energy progress, and policy needs towards protecting the

climate (max 2 deg.C warming), (Energy Technology Perspectives, 2012)

Some possible conclusions

• Technologies with present uncertainties have associated

risks that need to be considered – potential upside along

with downside

– (but downside is what matters for risk averse decision making)

• Cost estimates difficult – particularly where techs not yet

commercialised, but also into future

– Scale economies pulling costs down as we learn, but also

potential resource limits that eventually push prices up

• Demonstration + (hopefully) commercialisation of new

techs likely to take considerable time, and this slows

potential speed of deployment

– Shouldn’t count on unproven technologies inevitably succeeding

– If it was easy, normally would have already happened by now

(although take care as some exceptions to this)

Some possible conclusions in Aust. context • Capital stock turnover of energy supply infrastructure is

slow and our current infrastructure very high emissions, so

need to start ASAP.

– deployment of proven technologies highest policy priority

• Energy efficiency is likely highest sector priority

– many proven techs offering abatement at low risk and cost “The

cheapest, cleanest and safest way of addressing all our [energy] goals is to

use less energy” UK Energy White Paper

• CCGT a flexible supply option

– large emission abatement compared with coal, technically likely a

better CCS option than coal. Key issue for NSW is CSM resource

and social acceptability

• Renewable energy options highly diverse

– need separate assessment 36

Documents

Some possible frameworks for assessing The potential for, and … jury... · for, and barriers to, development of alternative forms of energy generation (eg: tidal, geothermal) in