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Generation Technology Options in a Carbon-Constrained World

Generation Technology Options in a Carbon-Constrained World. October 2007 Prepared by the Energy Technology Assessment Center. Objectives of the Levelized Cost of Electricity Analysis. Provide a useful generic basis for comparison of technologies for base load generation.

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Generation Technology Options in a Carbon-Constrained World

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  1. Generation Technology Options in a Carbon-Constrained World October 2007 Prepared by theEnergy Technology Assessment Center

  2. Objectives of the Levelized Cost of Electricity Analysis • Provide a useful generic basis for comparison of technologies for base load generation. • Provide strategic comparisons of technologies over plant lifetimes. • Evaluate sensitivities of levelized cost of electricity (LCOEs) to potential CO2 costs and other parameters

  3. Overall Analytical Approach for LCOE Studies • Utilize EPRI Technology Assessment Guide (TAG) capital cost data and methodologies to calculate levelized costs of electricity (LCOEs) in constant 2006 $. • Survey available plant performance and cost estimates based on most recent data. • Choose representative values for each technology. • Incorporate key assumptions needed for calculations – capital cost, fuel cost, annual and fixed O&M, plant life, fuel type and energy content, cost of money. • No production or investment tax credits assumed for any technologies. • Assume that current technology parameters and costs are representative of 2010–2015. • Estimate LCOEs for 2020–2025 based on expected technology-driven improvements in performance and reductions in capital cost.

  4. Capital Cost Estimating Approach • Costs are to be reported in reference year dollars: • No cost escalation to startup date included. • Plant site is assumed to be clear and level. • Cost estimate assumes mature technology: • Plant is assumed to operate as designed (no allowance for field modifications) • Extra costs for 1st-of-a-kind demonstration not included

  5. Cost Basis for LCOE Estimates • Total Plant Cost (TPC): • All process and support facilities; fuel handling and storage; water intake structure and wastewater treatment; offices, maintenance shops, and warehouses; step-up transformer • Sometimes referred to as Engineering, Procurement, and Construction Cost (EPC), or Overnight Capital Cost • Owners Costs: • Pre-production costs, working capital, land, license fees, interest during construction • Project-specific Costs: • Project development, utility interconnections, legal/financial consulting, owner’s project management

  6. Capital Cost Estimate Summary • Total Capital Requirement (TCR) = TPC + Owner’s Costs • Total Capital Requirement (TCR) is typically 16–19% higher than Total Plant Cost (TPC): • Typical EPRI Owner’s Costs add about 5–7% to TPC • Interest during construction adds another 11–12% to TPC • The adder for project-specific costs varies widely: • Depends on project and site-specific requirements • Equivalent to 10–15% of TPC • “All-in” capital cost = TCR + estimated project specific costs When comparing capital cost estimates: • It is important to know if values are in constant year dollars vs. future year dollars • It is important to know which components of cost are included/excluded.

  7. Technology Assumptions for this Analysis • Near Term – 2010 to 2015 • Modest extrapolation of today’s technology. • Based on foreseeable technology development. • Longer term – 2020 to 2025 • Assume that established R&D objectives are achieved, and technology development is successful. • Estimated reductions in costs are based on assessment of potential technology improvements. Examples: new materials and designs, new gas turbines, chemical processes, and membrane contactors, and a wide range of other technologies.

  8. Near-Term: 2010–2015

  9. 0.86 Metric Tons CO2/MWh X $50/Ton = +$43/MWh Pulverized Coal Combustion2010–2015 Levelized Cost of Electricity, $/MWh All figures in 2006 $ PC ($2290/kW) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  10. Comparison of PC and IGCC2010–2015 Levelized Cost of Electricity, $/MWh All figures in 2006 $ IGCC ($2730/kW) PC ($2290/kW) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  11. 0.38 Metric Tons CO2/MWh X $50/Ton = +$19/MWh Natural Gas Combined Cycle Costs2010–2015 Levelized Cost of Electricity, $/MWh All figures in 2006 $ NGCC ($8/MMBtu, $730/kW) NGCC ($6/MMBtu, $730/kW) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  12. Comparison of PC, IGCC, NGCC2010–2015 Levelized Cost of Electricity, $/MWh All figures in 2006 $ IGCC NGCC ($8/MMBtu) PC NGCC ($6/MMBtu) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  13. Nuclear Data Range Levelized Cost of Electricity, $/MWh All figures in 2006 $ $3720/kW(Upper end – EPRI TAG data) $3500/kW(Average – EPRI TAG data) $3260/kW(Lower end – EPRI TAG data) All calculations for 1400 MW, 90% CF Rev. Oct 2007 Cost of CO2, $/Metric Ton

  14. Non-Emitting Generation Technologies Levelized Cost of Electricity, $/MWh All figures in 2006 $ Solar thermal power has LCOEs ranging between $120MW/h and $260/MWh. Biomass Wind (32.5% Capacity Factor) Nuclear Rev. Oct 2007 Cost of CO2, $/Metric Ton

  15. Solar Thermal Trough Design2010–2015 Levelized Cost of Electricity, $/MWh All figures in 2006 $ 280 260 240 TAG -- estimated LCOE range is $120/MWh to $260/MWh 220 200 Average LCOE ~ $190/kWh, Average All-in Capital Cost ~ $3150/kW 180 160 140 120 Rev. Oct 2007 100 0 10 20 30 40 50 Cost of CO2, $/Metric Ton

  16. Comparative Levelized Costs of Electricity 2010–2015 Levelized Cost of Electricity, $/MWh All figures in 2006 $ Biomass IGCC Wind (32.5% Capacity Factor) NGCC ($8/MMBtu) NGCC ($6/MMBtu) PC Nuclear Rev. Oct 2007 Cost of CO2, $/Metric Ton

  17. Longer-Term: 2020–2025

  18. Integrated Gasification Combined Cycle, Pulverized Coal with CO2 Capture Levelized Cost of Electricity, $/MWh All figures in 2006 $ IGCC ($2730/kW, no CO2 capture, 2010–2015) IGCC ($3100/kW, + CO2 capture, 2020–2025) PC ($3060/kW, + CO2 capture, 2020–2025) PC ($2290/kW, no CO2 capture, 2010–2015) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  19. Impact of Anticipated Cost, Performance Improvements on PC, IGCC with CO2 Capture Levelized Cost of Electricity, $/MWh All figures in 2006 $ PC + CO2 Capture ($3820/kW); IGCC + CO2 capture ($3780/kW)(near term) PC + CO2 Capture ($3060/kW); IGCC + CO2 capture ($3100/kW) (with cost, performance improvements) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  20. Comparative Levelized Costs of Electricity 2020–2025 Levelized Cost of Electricity, $/MWh All figures in 2006 $ Biomass IGCC PC Wind (42% Capacity Factor) Nuclear NGCC ($6/MMBtu) NGCC ($8/MMBtu) Rev. Oct 2007 Cost of CO2, $/Metric Ton

  21. Closing Thoughts • Several key uncertainties impact near-term and long-term project decisions and research priorities: • Stringency of future CO2 emissions reduction goals • Future cost of CO2 • Future price of natural gas (high sensitivity) • Financing costs and challenges • CO2 capture and storage technology development and costs • Impact of using lower rank coals • Siting requirements • Water availability • Renewable energy technology development • Technology-driven reductions in nuclear costs • Extraordinary opportunity to develop and demonstrate a very low emissions portfolio of generation technologies. Together…Shaping the Future of Electricity

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