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A Systems Approach for CO 2 Mitigation, Capture & Storage in the Electricity Sector An Ontario Case Study P. L. Douglas, E. Croiset, A. Elkamel, H. Mirza,

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Presentation on theme: "A Systems Approach for CO 2 Mitigation, Capture & Storage in the Electricity Sector An Ontario Case Study P. L. Douglas, E. Croiset, A. Elkamel, H. Mirza,"— Presentation transcript:

1 A Systems Approach for CO 2 Mitigation, Capture & Storage in the Electricity Sector An Ontario Case Study P. L. Douglas, E. Croiset, A. Elkamel, H. Mirza, C. Alie, A. Shafeen*, M. Gupta* Department of Chemical Engineering University of Waterloo, Waterloo, Ontario *Natural Resources Canada Ottawa, Canada 1-519-888-4601 pdouglas@cape.uwaterloo.ca http://chemeng.uwaterloo.ca/faculty/douglas.html

2 Presentation outline n overview of CO 2 CCS R&D n some recent results: 1.CO 2 capture from OPGs Nanticoke GS 2.geological storage of CO 2 captured from Nanticoke GS 3.fleet-wide CCS from Ontarios electricity sub-sector n summary CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

3 Overview the demand/supply gap in Ontario, Canada problem statement – mathematical formulation 3 scenarios 1.BAU – no CO 2 constraints 2.Kyoto Accord CO 2 constraints 3.scenario 2 + increased NG prices summary CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

4 Overview of R&D areas H 2 plants regional H 2 economy oil sands industrial processes – cement – oil, gas & chemicals fleet-wide optimisation CO 2 capture technology – MEA absorption – O 2 /CO 2 recycle combustion – membranes electrical generation – PC, IGCC – NGCC – SOFC CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

5 Canadas GHG Emissions Source: Environment Canada, 2005 1990 Baseline 596 Mt Kyoto Target: 6% below 1990 baseline (560Mt) 2003 emissions 740 Mt 24% above 1990 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

6 n Taking into account time dependent parameters, such as future electricity demand and fuel price fluctuations, what is the optimal mix of electricity supply sources needed to: Satisfy electricity demand each year while meeting CO 2 emission targets at minimum cost Research Objective CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

7 The Pyramid Region planning System Scheduling Process integration/optimization Unit design/modelling Fortran, Matlab, Aspen (NLP) GAMS (LP, NLP, MIP,MINLP) GAMS (MILP, MINLP) Tools Information Flow Models Decisions CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

8 Current Work n Current work involves development of a deterministic multi-period planning model that will is implemented in GAMS. n The model will take into account several time dependent parameters and variables that may change over time. CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

9 Presentation outline n overview of CO 2 CCS R&D n some recent results: 1.CO 2 capture from OPGs Nanticoke GS 2.geological storage of CO 2 captured from Nanticoke GS 3.fleet-wide CCS from Ontarios electricity sub-sector n summary CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

10 CO 2 capture from OPGs Nanticoke GS n one of eight 500 MW e coal fired boilers n Powder River Basin – US low sulphur coal mixture n flue gas flow rate 2,400 tonnes/hr (per boiler) n CO 2 flow rate 336 tonnes/hr (per boiler) n Siemens steam turbines n 85% recovery of CO 2 at 98% purity n MEA absorption process CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

11 Nanticoke GS 3920 MW Nanticoke Generating Station Waterloo CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

12 OPGs Nanticoke Generating Station ONTARIO QUEBEC MANITOBA Lake Huron Nanticoke (3,920 MW) Lake Erie OPGs Nanticoke GS is on the north shore of Lake Erie Waterloo Kingston CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

13 CO 2 capture – fossil fuel generating station fossil fuel flue gas air boiler 500 MW e CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

14 CO 2 capture - MEA absorption 98% pure CO 2 stack gas stripper absorber fossil fuel flue gas air boiler 500 MW e CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

15 CO 2 capture - MEA absorption 98% pure CO 2 stack gas stripper absorber fossil fuel flue gas air boiler Issues: large and expensive: – 4.3 ¢/kwh – $400 x 10 6 for 500 MW plant energy cost of capture plant ~ 25% energy output of generating station how best to integrate energy requirements of capture plant with GS 500 MW e CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

16 CO 2 capture - MEA absorption 98% pure CO 2 stack gas stripper absorber fossil fuel flue gas air boiler historically: most research has focussed on experimental operation of absorber little research on stripper or overall process simulation of complete process surprisingly difficult – very large recycle stream – MEA-CO 2 -H 2 O system is a highly non-ideal electrolyte solution 500 MW e CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

17 Simulation of MEA absorption process blower and compressor coolers stripper reboiler Alie, C., L. Backham, E. Croiset, P.L. Douglas and M.A. Douglas, 2005, "Simulation of CO 2 Capture Using MEA Scrubbing: a Flowsheet Decomposition Method", Energy Conversion & Management, 46, 475-487 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

18 Minimise heat duty in reboiler Q min for 500 MW e power plant is 353 MW th vary CO 2 loading in LEAN-ABS to minimise Q reb Q reb CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

19 Minimised reboiler heat duty is huge! Q min for 500 MW e power plant is 353 MW th boiler output is 500 MW e 1428 MW th boiler output is 500 MW e (1428 MW th ) and minimised reboiler heat duty from CO 2 capture process will require 353 MW th CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

20 How best to integrate capture plant with GS? 98% pure CO 2 stack gas stripper absorber fossil fuel flue gas air boiler Need to supply: blowers and compressors electricity for blowers and compressors steam for reboiler cooling water for coolers 500 MW e CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

21 Energy requirements for 500 MW e GS shaft power (MW e ) n CO 2 compressors40 n flue gas blower10 thermal energy (MW th ) n reboiler heat duty353 n kg steam/kg CO 2 captured 1.7 n coolers430 blower and compressor 50 MW e coolers, 430 MW th stripper reboiler, 343 MW th CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

22 Best case assume all heat can be supplied free from steam cycle shaft power (MW e ) n CO 2 compressors40 n flue gas blower10 thermal energy (MW th ) n reboiler heat duty353 n kg steam/kg CO 2 captured 1.7 n coolers430 min. de-rate = (40 + 10) = 50 MW e = (50 / 500) * 100 = 10% CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

23 Worst case assume none of the heat can be supplied free from steam cycle shaft power (MW e ) n CO 2 compressors40 n flue gas blower10 thermal energy (MW th ) n reboiler heat duty353 n kg steam/kg CO 2 captured 1.7 n coolers430 max. de-rate = (40 + 10) + 353*0.35 = 173.5 MW e = (173.5 / 500) * 100 = 34.7% CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

24 Simulation of steam cycle match steam demand from MEA plant with supply from steam cycle IP/LP crossover pipe CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

25 Match reboiler with steam from IP/LP crossover MEA plant steam cycle IP/LP crossover best case (10%) typical de-rate (20%) worst case (35%) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 costs: ~ $400 million; $50/tonne of CO 2 avoided

26 Summary of costs CO 2 capture from 500 MW e coal fired boiler generating station de-rate ~ 20% capital costcapital + operating costcost of electricity (MM US $)(US $/tonne of CO 2 )(c/kwh) 40050 4.3 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

27 Presentation outline n overview of CO 2 CCS R&D n some recent results: 1.CO 2 capture from OPGs Nanticoke GS 2.geological storage of CO 2 captured from Nanticoke GS 3.fleet-wide CCS from Ontarios electricity sub-sector n summary CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

28 subsurface temperature & pressure P c = 7.38 MPa T c = 31.1°C store CO 2 at supercritical conditions

29 store CO 2 at supercritical conditions store at depths > 800 m to maintain supercritical conditions P c = 7.38 MPa T c = 31.1°C CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

30 Evaluation of potential reservoirs CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

31 CO 2 Storage in Ontario ONTARIO QUEBEC MANITOBA Lake Huron Nanticoke (3,920 MW) Lake Erie n two potential reservoirs identified –Lake Huron –Lake Erie n significant capacities –Lake Huron (289 MT) –Lake Erie (442 MT) Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part I: Storage Evaluation of Potential Reservoirs, Energy Conversion & Management, 45, 2645- 2659 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

32 Nanticoke GS 3920 MW Nanticoke Generating Station Waterloo CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

33 Great Lakes Basin Waterloo Nanticoke GS 3920 MW CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

34 Southwestern Ontario 8382818079 45 44 43 42 Waterloo

35 Location of potential reservoirs 800 m 8382818079 45 44 43 42 NZ SZ 289 milliontonnes 442 milliontonnes Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part I: Storage Evaluation of Potential Reservoirs, Energy Conversion & Management, 45, 2645-2659 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

36 Injection location in Lake Erie http://superior.eng.ohio-state.edu/lakes/erie/nf-index.html CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

37 n single 500 MW boiler –2.7 *10 6 tonnes/yr (from 1 500 MW plant) –163 years of sequestration in southern zone (SZ) n 8 500 MW boilers –21.5*10 6 tonnes/yr (from 8 500 MW plants) –20.5 years of sequestration in southern zone (SZ) Evaluation of potential reservoir capacity CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

38 Location of potential reservoirs & route of pipeline to injection point 800 m 8382818079 45 44 43 42 NZ SZ 112 km 100 km 50 km Injection point Nanticoke 289 x 106 tonnes (56 years) 442 x 10 6 tonnes (86 years) Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part I: Storage Evaluation of Potential Reservoirs, Energy Conversion & Management, 45, 2645-2659 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

39 Location of potential reservoirs 800 m 8382818079 45 44 43 42 NZ SZ 112 km injection point Nanticoke 289 x 10 6 tonnes (56 years) 442 x 10 6 tonnes (86 years) Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part I: Storage Evaluation of Potential Reservoirs, Energy Conversion & Management, 45, 2645-2659 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

40 Cost estimation: number of injection wells n emission from a single 500 MW plant is ~14,000 tonnes/day n assume injection rate = 1400 tonnes/day/well number of injection wells = 10 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

41 Cost estimation: components n pipeline cost –offshore –onshore + offshore n injection cost –no. of injection well –no. of injection well platform n operating cost CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

42 Cost estimation: assumptions n assumptions –pure CO 2 is available at 110 bar –no intermediate compression is required for CO 2 transportation to the target location –except transportation, injection and operating cost, all other costs are comparatively negligible and do not influence the total cost. CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

43 Cost estimate – captial cost ItemProperties Unit Cost [US$/m] Total Cost [US$ in million] Length of pipe line (offshore) 112 kmDiameter =16"/406 mm 1,000 ~2,250 (offshore) 112~252 Length of pipe (onshore + offshore) 150 kmDiameter =16"/406 mm 750 (onshore) 125~188 # of injection wells10Depth of well =1,000 m4,50045 # of offshore platforms1Depth of platform = 25 m4,000,000100 Total investment 257~397(off) 270~333 (on) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

44 Cost estimate - total cost n total investment –250 ~ 400 million US$ n annual operating cost –7.5% of the total investment [20 ~ 30 million/yr] n storage cost/ton of CO 2 –5% interest rate and 25 years repayment period –7.5 ~ 11.5 US$/ton CO 2 storage n assumed capture cost = US$30 ~ US$60/ton of CO 2 avoided n sequestration cost = 10% ~ 30% of the total capture & storage cost CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

45 Summary of storage results n possible location of the injection point –in the middle of Lake Erie n estimated reserve capacity –NZ=56 years, SZ=86 years (500 MW e generating station) n total capital cost US$ 257~ 400 million –7.5 ~ 11.5 US$/tonne of CO 2 storage n storage cost = 10% ~ 30% of the total capture & storage cost Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part II: Cost Estimation, Energy Conversion & Management, 45, 3207-3217 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

46 Summary of storage results n possible location of the injection point –in the middle of Lake Erie n estimated reserve capacity –NZ = 56 years, SZ = 86 years (500 MW e generating station) n total capital cost ~ 300 million US$ –~ 10 US$/tonne of CO 2 storage n storage cost = ~ 15% of total capture & storage cost Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part II: Cost Estimation, Energy Conversion & Management, 45, 3207-3217 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

47 Cost of CO 2 storage in Lake Erie ONTARIO QUEBEC MANITOBA Lake Huron Nanticoke (3,920 MW) Lake Erie n ~ 442 MT storage capacity n ~ 336 tonnes/hr per boiler n ~ 160 years / boiler n ~ 20 years / 8 boilers n ~ 300 million US$ –~ 10 US$/tonne of CO 2 storage Shafeen, A., E. Croiset, P.L. Douglas and I. Chatzis, 2004, CO 2 Sequestration in Ontario, Canada, Part II: Cost Estimation, Energy Conversion & Management, 45, 3207- 3217 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

48 Summary of costs CO 2 capture from 500 MW coal fired boiler generating station de-rate ~ 25% capital costcapital + operating costcost of electricity (MM US $)(US $/tonne of CO 2 )(c/kwh) ~ 400 ~ 50 ~ 4.3 CO 2 storage 142 years of storage in NZ and SZ capital costcapital + operating costcost of electricity (MM US $)(US $/tonne of CO 2 )(c/kwh) ~ 300 ~ 10 ~ 0.86 Total ~ 700 ~ 60 ~ 5.16 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

49 Presentation outline n CO 2 mitigation group at UW n some recent results: 1.CO 2 capture from OPGs Nanticoke GS 2.geological storage of CO 2 captured from Nanticoke GS 3.fleet-wide CCS from Ontarios electricity sub-sector n summary and future work CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

50 CO 2 Storage in Ontario Lennox (2,100 MW) Thunder Bay (360 MW) Atikokan (211 MW) ONTARIO QUEBEC MANITOBA Lake Huron Lakeview (1,148 MW) Lambton (1,948 MW) Nanticoke (3,920 MW) Lake Erie n Two potential reservoirs identified –Lake Huron –Lake Erie n An economic analysis has been performed on this two reservoirs (Shafeen, Croiset, Douglas, 2003) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

51 Six OPG fossil fuel stations Nanticoke 3920 MW 58.2% Lambton 1975 MW 24.5% Lakeview 1140 MW 6.4% Lennox 2140 MW 3.9% Thunder Bay 310 MW 4.5% Atikokan 215 MW 2.5%

52 C i ( i = 1-5) CO 2 C-C i CO 2 N i (i = 1-3) H i (i=1-69) PC i new CO 2 IG i new CO 2 NG i new CO 2 C-O i new NG i (i=1) AiAi C-NG i C-C i new C-NG i new S-C i S-NG i S-C i new S-NG i new S-O i new Generating capacity superstructure model all of Ontarios generating stations splitter sequestration capture processnew process NG i new PC i new IG i new New plants with captureNew plants without capture Existing non- fossil fuel plants Existing fossil fuel plants N i new CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

53 – Generating Capacity Superstructure CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

54 subject to: MINLP formulation (objective function = sum of total expenditures) (equality constraints = model equations) (inequality constraints = process limitations) (x is a vector of continuous variables = process variables) (y is a vector of binary variables e.g. location of new plants) (p is a vector of parameters e.g. cost of energy) min f(x, y, p) h(x, y, p) = 0 g(x, y, p) 0 x ε X R n y ε Y = {0, 1} p x, y CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

55 Word statement subject to: electricity demand CO 2 emission constraints logical constraints – plant capacity – capture process capacity – selection of fuel and plant shut down – s election of CO 2 capture process(es) – location for CO 2 sequestration – selection of new power plant(s) – upper & lower bound on operational changes minimize Σ (over n years) { annual cost of power generation + retrofit cost for fuel switching + annual cost of new power plants + annual cost of CCS } objective function constraints CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

56 The Objective Function – f(i, t, j, k, s, l) = total cost of running fleet for n years, including capital and operating costs CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

57 if an existing boiler is shutdown, no CO 2 capture should be put online CO 2 reduction c/w carbon credits electricity demand constraint (takes into account energy required for capture and savings due to demand management) only one carbon capture technologies on same boiler power availability timing from a new plant (power is available only when new plant is built) The Constraints - 1 fuel switching can occur only one (i.e. cannot switch back) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

58 capacity constraint for a given fuel start of a given project occurs only once time constraint relating fuel-switching decision and operation while using a particular fuel capacity constraint (non-fossil) reformulated capacity constraint one fuel is selected for each fossil boiler The Constraints - 2 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

59 minimize (annualized cost of power generation + retrofit cost for fuel switching + annualized cost of new power plants + annualized cost of carbon capture and storage (CCS) ) 2 classes of continuous variables: E i, E ij 4 classes of binary variables : X ij, y i, z ik, w is Objective Function i : POWER PLANT j : FUEL (COAL / NG) k : CAPTURE PROCESS s : SEQUESTRATION

60 Ontarios Demand/Supply Gap source: OPA Supply Mix Advice, 2005 – MW Renewable Natural Gas & Oil Nuclear Coal CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

61 The Demand/Supply Gap in Ontario – 61 Source: OPA Supply Mix Advice, 2005 MW Renewable Natural Gas & Oil Nuclear Coal –New Power: Pulverized coal NGCC IGCC Nuclear –New Power: Pulverized coal + CCS NGCC + CCS IGCC +CCS Nuclear –Existing Stations Fuel Switching Fuel Balancing EXISTING NATURAL GAS & OIL COAL EXISTING NUCLEAR EXISTING RENEWABLES DEMAND CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007

62 Model Inputs nForecasted energy demand nFixed O&M cost nVariable O&M cost nFuel price fluctuations nCapital cost of new plants nConstruction lead time nEnergy conservation initiatives nAnnual CO 2 emission targets nCost carbon capture and storage nAnnual budget (if specified) nCost of CO 2 credits – Source: Electricity Demand in Ontario, ICF Consulting – Source: Energy Future Project, National Energy Board – Source: OPA Supply Mix, 2005 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

63 Optimal Plan to Add New Capacity (Example) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 MW New Natural Gas New Coal New Nuclear New IGCC CONSTRUCTION

64 Optimal Plan to Add New Capacity (Example) MW New Natural Gas Plant New Coal New Nuclear New IGCC Plant DEMAND CONSTRUCTION New Natural Gas New Coal New Nuclear New IGCC Demand CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

65 Model Outputs Output data from each boiler: annual energy production annual CO 2 emissions CO 2 sequestration site whether carbon capture should be put online, and in which year whether fuel-switching should be implemented, and in which year Year in which power plant construction should commence Annual out-of-province imports Annual expenditure for entire fleet CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

66 – Three Scenarios 1. Base case – 2006 – 2020 – no CO 2 constraints – 1%/year growth in electricity demand 2. 50% reduction in CO 2 in year 2011 – 2006 – 2020 – 50% reduction in CO 2 constraints from years 2011-2020 – 1%/year growth in electricity demand 3. Case 2 with increased natural gas prices – 2006 – 2020 – 50% reduction in CO 2 constraints from years 2011-2020 – 1%/year growth in electricity demand – natural gas prices are 3 times NEB forecast CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

67 Scenario 1 - Base Case – electricity generation CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

68 Scenario 1 - Base Case CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

69 Scenario 1 - Base Case CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

70 Scenario 1 - Base Case CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

71 Scenario 1 - Base Case – annual expenses CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

72 Total expenditure: 53.32607 billion Scenario 1 - Base Case CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

73 Scenario 1 - Base Case – new construction new NGCC power plants CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

74 Scenario 1 - Base Case – COE Average COE = 2.1 ¢/kWh scenario 1 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

75 Scenario 1 - Base Case – CO 2 emissions CO 2 emissions increase from 24 to 29 MT/yr CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

76 Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CO 2 emissions dropped to 20Mt/yr after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

77 No CO 2 limit from 2006-2011; after 2011 CO 2 emission 20 Mt/yr Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

78 Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

79 Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

80 Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

81 Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

82 Total expenditure: 58.37949 billions Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

83 coal power plants that have been retrofitted with CCS coal power plants that have been retrofitted to burn NG Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 new NGCC power plants CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

84 Average COE = 2.3 ¢/kWh Scenario 2 – 20Mt/yr CO 2 emission limit after 2011 scenario 2 scenario 1 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

85 Scenario 3 – scenario 2 with increased NG prices CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

86 Scenario 3 – scenario 2 with increased NG prices CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

87 Scenario 3 – scenario 2 with increased NG prices CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

88 Scenario 3 – scenario 2 with increased NG prices CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

89 Scenario 3 – scenario 2 with increased NG prices CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

90 Total Expenditure: 88.98254 billions Scenario 3 – scenario 23 with increased NG prices CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

91 Scenario 3 – scenario 2 with increased NG prices coal power plants that have been retrofitted with CCS new PC, NGCC, PC+CCS and IGCC+CCS power plants CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

92 Scenario 3 – scenario 2 with increased NG prices Average COE = 3.5 ¢/kWh scenario 1 scenario 2 scenario 3 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

93 Scenario 3 – scenario 2 with increased NG prices CO 2 emissions dropped to 20Mt/yr after 2011 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

94 Existing Supply Mix In Ontario n Coal n Gas/Oil n Nuclear n Renewable –Hydroelectric –Wind –Biomass CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

95 Existing Supply Mix In Ontario n Coal n Gas/Oil n Nuclear n Renewable –Hydroelectric –Wind –Biomass CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

96 Existing Supply Mix In Ontario n Coal n Gas/Oil n Nuclear n Renewable –Hydroelectric –Wind –Biomass CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

97 Existing Supply Mix In Ontario n Coal n Gas/Oil n Nuclear n Renewable –Hydroelectric –Wind –Biomass CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

98 Existing Supply Mix In Ontario n Coal n Gas/Oil n Nuclear n Renewable –Hydroelectric –Wind –Biomass Source: OPA Supply Mix Advice, 2005 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

99 Power Generating Options Existing Power Stations The model considers the option to: Fuel BalanceFuel-Switch Carbon Capture & Storage CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

100 Power Generating Options cont… n New Power Plants –The power generating technologies considered are: – Pulverized coal (PC) – Natural Gas Combined Cycle (NGCC) – Integrated Gasification Combined Cycle (IGCC) – New Nuclear + CCS CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

101 Model Output n Output data from each boiler: –Energy production for each year –CO 2 Emissions for each year –Whether Carbon Capture should be put online, and in which year –What type of Carbon Capture technology to install –CO2 storage site –Whether fuel-switching should be implemented, and in which year n Year in which construction of new power plant should commence n Annual expenditure for entire fleet n Annual Cost of Electricity (COE) n Annual out-of-province imports CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

102 Two Case Studies Case Study Electricity Demand (MW) CO 2 Emissions (Mt of CO 2 ) Conservation Strategy Fuel Price Forecast New Sources Considered 1 medium demand growth with summer peak no restrictions normal conservation normal coal & NG price forecast nuclear, NGCC, IGCC, PC 2 medium demand growth with summer peak 6% reduction of 1990 levels by 2010 normal conservation normal coal & NG price forecast nuclear, NGCC, IGCC, PC CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

103 Model Statistics CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 single equations42,204 single variables25,526 discrete variables9,950 generation time36 minutes execution time12 hours

104 CASE STUDY I – BASE CASE Energy Supply Mix CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

105 Case 1 - Fleet Structure: New Power Plants CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

106 Fleet Structure: Existing Power Plants n All existing coal, natural gas, nuclear and renewable sources remain operational n No fuel switching implemented on existing coal power plants n No CCS retrofit on any of the existing coal power plants CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

107 Case 1 - Base-Load Electricity Production CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

108 Case 1 - Peak-Load Electricity Production CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

109 Case 1 - Expenditures ($ billions) Total Expenditure : $ 71 billion CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

110 Case 1 - CO 2 emissions CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

111 CASE STUDY II – CO2 LIMITS Energy Supply Mix CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

112 OPGs fossil fuel generating stations Lennox (2,100 MW) Thunder Bay (360 MW) Atikokan (211 MW) ONTARIO QUEBEC MANITOBA Lake Huron Lakeview (1,148 MW) Lambton (1,948 MW) Nanticoke (3,920 MW) Lake Erie n 6 fossil fuel generating stations n ~ 10,000 MW t n ~ 27 MT/year n two potential reservoirs –Lake Huron (289 MT) –Lake Erie (442 MT) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

113 Case 2 - Fleet Structure: New Power Plants 200620072008200920102011201220132014201520162017201820192020 New Power Plants w/o CCS NGCC (243 MW) X NGCC (760 MW) X NGCC (3,039 MW) X New Power Plants w/ CCS NGCC (648 MW) X New Nuclear Power Plants ACR-700 (1,406 MW) X CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

114 Case 2 - Fleet Structure: Fuel-Switching 200620072008200920102011201220132014201520162017201820192020 LambtonX Nanticoke X Atikokan Lennox Thunder Bay X Lambton, Nanticoke, Thunder Bay coal-fired GS are switched to NG CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

115 Case 2 - Fleet Structure: CCS retrofits 200620072008200920102011201220132014201520162017201820192020 Lambton X Nanticoke Atikokan Lennox Thunder Bay only Lambton coal-fired station is retrofitted with a CCS system CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

116 Case 2 – Base Load Electricity Production CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

117 Case 2 – Peak Load Electricity Production CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

118 Case 2 - Expenditures Total Expenditure : $ 77 billion CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

119 Case 2 - CO 2 emissions with constraints CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007 1.no CO 2 reduction constraints 2.6% reduction of 1990 CO 2 emissions by 2010

120 Power Generating Options n Existing Power Stations –The model considers the option to: Fuel BalanceFuel-Switch Carbon Capture & Storage CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

121 Summary of Case Studies CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

122 CO 2 Emissions from OPG – Source: Ontario Power Generation, 2005 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

123 Summary 1. Base case (max 45 MT/yr)2.1 013 6 NGCC w/o CCS 2. CO 2 24 MT/yr after 20112.3 9.5 3 3 NGCC w/o CCS 1 NGCC w CSS 1 retrofits to CCS 3 fuel switches to NG 1 nuclear 3. Case 2 + increased NG prices3.5 57.1 3 1 NGCC w/o CCS 2 PC w/o CCS 1 PC with CCS 2 IGCC with CCS 2 PC retrofitted to CCS 0 fuel switches to NG COE % increaseCPU time (¢/kwh) (hours) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

124 Summary n A deterministic multi-period model has been developed for energy planning n Model finds the optimal mix of electricity supply sources needed to satisfy electricity demand each year, while meeting CO2 emission targets, at a minimum cost n Model takes into account several time-depending variables and parameters CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

125 Future Work n Other case studies n Consider additional pollutants (NO x, SO 2, Hg) n Extend the current deterministic model to a stochastic formulation n CCS pipeline network optimization CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

126 Future work n continue to develop regional planning model –scenarios –multi-period planning –stochastic models –load duration curve –multi-pollutant mitigation n develop scheduling models with CO 2 constraints n study other jurisdictions –electricity sector –oil sands –hydrogen plants –carbon storage CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

127 Closing Remarks n Research supervisors: – Eric Croiset – Peter Douglas – Ali Elkamel n Financial support: –Ontario Power Generation (OPG) –NRCan –NSREC CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

128 Acknowledgements n co-authors: –Dr. Eric Croiset, Dr. Ali Elkamel –Mr. Colin Alie, Mr. Ahmed Shafeen and Dr. Haslenda Hashim n sponsors Natural ResourcesRessources NaturellesCanada CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

129 Acknowledgements - Sponsors Natural ResourcesRessources NaturellesCanada CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

130 Sensitivity cases NG prices: – $6/GJ, $7.80/GJ and $12/GJ fleet-wide CO 2 reduction targets: – 3%, 6%, 20%, 40% and 60% electricity demand: – base case (2002) and 10% growth (1%/yr for 10 years) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

131 Effect of NG price on COE and the best strategy $6/GJ, $7.8/GJ and $12/GJ increasing NG price results in early aggressive CO 2 mitigation strategy CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

132 At low NG prices, $6/GJ: < 40% CO 2 reduction switching from coal to NG and NGCC is cost effective approach to CO 2 mitigation at 60% CO 2 reduction CCS (Nanticoke) and NGCC are recommended At medium NG prices, $7.8/GJ: < 40% CO 2 reduction switching from coal to NG and NGCC is cost effective approach to CO 2 mitigation at 40% CO 2 reduction CCS (Nanticoke) and IGCC plants are recommended NGCC is not recommended at 60% CO 2 reduction nuclear is recommended At high NG prices, $12/GJ: at 6% CO 2 reduction CCS (Nanticoke) > 20% CO 2 reduction nuclear is recommended NG is not recommended (no switching from coal or NGCC) > 40% CO 2 reduction CCS (Nanticoke & Lambton), IGCC, and nuclear plants are recommended Summary – 1 effect of NG price at base load CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

133 Effect of NG Price on COE at 10% growth $6/GJ, $7.8/GJ and $12/GJ base fuel balancingfuel balancing + fuel switching fuel balancing + fuel switching + new plants fuel balancing + fuel switching + new plants + CCS growth results in very early aggressive CO 2 mitigation strategy CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

134 At low NG prices ($6/GJ): < 40% CO 2 reduction switching from coal to NG is cost effective approach to CO 2 mitigation > 40% CO 2 reduction CCS (Nanticoke), NGCC and nuclear plants are recommended At medium NG prices, ($7.8/GJ): NG switching, IGCC and nuclear are always recommended > 40% CO 2 reduction CCS (Nanticoke and Lambton) and NGCC is recommended At high NG prices, ($12/GJ): IGCC, CCS and nuclear are always recommended NG is not recommended Summary – 2 effect of NG price at base load + 10% growth CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

135 base fuel balancingfuel balancing + fuel switching fuel balancing + fuel switching + new plants fuel balancing + fuel switching + new plants + CCS base case 10% growth case Comparison of two cases CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

136 1. What if all coal fired generating stations are forced to shut down & replace with NG? 2. What if Nanticoke and Lambton are allowed to stay open and all other coal fired generating stations are forced to shut down & replace with NG? Additional cases CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

137 Effect of NG Price on COE and the best strategy $6/GJ, $7.8/GJ and $12/GJ base fuel balancingfuel balancing + fuel switching fuel balancing + fuel switching + new plants fuel balancing + fuel switching + new plants + CCS increasing NG price results in early aggressive CO 2 mitigation strategy % CO 2 Reduction replace all coal with NG allow Nanticoke and Lambton to remain open and replace remaining with NG CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

138 OPG fleet in 2003 74 generating stations electricity generation 120 TWh/yr COE 2.35 ¢/KWh (calculated) 70% of electricity in Ontario is produced by OPG nuclear - 44% hydroelectric - 27% fossil – 28.5% wind turbine – 0.5% 01020304050 electricity generation (TWh/yr) coal natural gas nuclear hydroelectric wind turbine Source: OPG Report, 2003 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

139 Question? electricity generation 120 TWh/yr COE 2.35 ¢/KWh (calculated) 70% of electricity in Ontario is produced by OPG nuclear - 44% hydroelectric - 27% fossil – 28.5% wind turbine – 0.5% 01020304050 electricity generation (TWh/yr) coal natural gas nuclear hydroelectric wind turbine Source: OPG Report, 2003 What is the best strategy for OPG to pursue to satisfy energy demand and reduce CO 2 emissions? CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

140 no clear optimal strategy depending on scenario, NG, NGCC, nuclear, CCS and IGCC are all recommended – NG price and growth rate effect optimal strategy more work on scenario development and cost estimates needs to be undertaken Conclusions from fleet-wide study CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

141 Base Case – OPG fossil fuel plants (2002) LV1-LV8 N1-N8 A1 LV1-LV8 TB1-TB2 Existing fossil-fuel New power plants 0510152025 electricity generation (TWh/yr) Lambton Nanticoke Lakeview Atikokan Lennox Thunder Bay PC IGCC NGCC PCcap IGCCcap NGCCcap coal NG L1-L4 Source: OPG Report, 2003 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

142 CO 2 mitigation options conservation increasing power plant efficiency increasing use of renewable energy fuel balancing (load balancing) – reduce load on fossil plants and increase load on non-fossil plants when possible fuel switching – switch to lower carbon intensive fuel, e.g. coal to natural gas or wind or nuclear carbon capture and storage (CCS) CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007

143 Effect of CO 2 reduction on COE Hashim, H., P.L. Douglas, A. Elkamel and E. Croiset, 2005, An Optimization Model for Energy Planning with CO 2 Emission Considerations, Industrial & Engineering Chemistry Research, 44, 879-890 60%

144 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8th – 12th, 2007 Effect of CO 2 reduction on COE Hashim, H., P.L. Douglas, A. Elkamel and E. Croiset, 2005, An Optimization Model for Energy Planning with CO 2 Emission Considerations, Industrial & Engineering Chemistry Research, 44, 879-890

145 Effect of CO 2 reduction on COE Hashim, H., P.L. Douglas, A. Elkamel and E. Croiset, 2005, An Optimization Model for Energy Planning with CO 2 Emission Considerations, Industrial & Engineering Chemistry Research, 44, 879-890 CHEMRAWN-XVII & ICCDU-IX Conference on Greenhouse Gases, Kingston, Ontario, July 8 th – 12 th, 2007


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