1. ECE 333 Renewable Energy Systems Lecture 2: Introduction, Power Grid Components Prof. Tom Overbye Dept. of Electrical and Computer Engineering University of Illinois at Urbana-Champaign overbye@illinois.edu

2. Announcements Be reading Chapters 1 and 2 from the book Homework 1 is 1.1, 1.11, 2.6, 2.8, 2.14. It will be covered by the first in-class quiz on Thursday Jan 29. 1

3. Energy Economics Electric generating technologies involve a tradeoff between fixed costs (costs to build them) and operating costs Nuclear and solar high fixed costs, but low operating costs (though cost of solar has decreased substantially recently) Natural gas/oil have low fixed costs but can have higher operating costs (dependent upon fuel prices) Coal, wind, hydro are in between Also the units capacity factor is important to determining ultimate cost of electricity 2

4. Ball park Energy Costs Source: Steve Chu and Arun Majumdar, “Opportunities and challenges for a sustainable energy future,” Nature, August 2012, Figure 6 Energy costs depend upon the capacity factor for the generator. The capacity factor is the ratio of the electricity actually produced, divided by its maximum potential output. It is usually expressed on an annual basis. 3

5. Natural Gas Prices 1997 to 2015 Marginal cost for natural gas fired electricity price in $/MWh is about 7-10 times gas price 4

6. Coal Prices have Fallen Substantially from Four Years Ago Source: http://www.eia.gov/Ftproot/coal/newsmarket/coalmar110805.pdf BTU content per pound varies between about 8000 and 15,000 Btu/lb, giving costs of around $1 to 2/Mbtu Jan 2015 prices per ton range from $11.55 to $62.15 5

7. Power System Structure All power systems have three major components: Load, Generation, and Transmission/Distribution. Load: Consumes electric power Generation: Creates electric power. Transmission/Distribution: Transmits electric power from generation to load. A key constraint is since electricity can’t be effectively stored, at any moment in time the net generation must equal the net load plus losses 6

8. Electric Power Systems Electric utility: can range from quite small, such as an island, to one covering half the continent – there are four major interconnected ac power systems in North American, each operating at 60 Hz Smaller systems: microgrids, stand-alone, backup systems Transportation – Airplanes and Spaceships: reduction in weight is primary consideration; frequency is 400 Hz. – Ships and submarines – Automobiles: dc with 12 volts standard 7

9. Large-Scale Power Grid Overview 8

10. Notation and Voltages The IEEE standard is to write ac and dc in smaller case, but it is often written in upper case as AC and DC. North American grid is 60 Hz (ac), whereas most of the rest of the world is 50 Hz. In the US the standard household voltage is 120/240, +/- 5%. Edison actually started at 110V dc. Other countries have other standards, with the European Union recently standardizing at 230V. Japan’s voltage is just 100V – A higher standard voltage allows for more power, but is more of a safety hazard 9

11. Loads Can range in size from less than one watt to 10’s of MW Loads are usually aggregated for system analysis The aggregate load changes with time, with strong daily, weekly and seasonal cycles – Load variation is very location dependent 10

12. Example: Daily Variation for CA 11

13. Example: Weekly Variation 12

14. Example: Annual System Load 13

15. Load Duration Curve A very common way of representing the annual load is to sort the one hour values, from highest to lowest. This representation is known as a “load duration curve.” 6000 5000 4000 3000 2000 1000 0 DEMAND (MW) 0 1000 HRS 7000 8760 Load duration curve tells how much generation is needed 14

16. GENERATION Large plants predominate, with sizes up to about 1500 MW with wind a rapidly growing source. Coal is still the most common source but with a value falling from 56% a few years ago to 39% now. Natural gas has rapidly grown due to low costs, now making 27% of total. Nuclear (20%), hydro (6%), wind (4.3%), wood (1.0%), solar (0.4%, high growth) New construction is mostly natural gas and wind with economics highly dependent upon the gas price Generated at about 20 kV for large plants, around 600 V for many wind turbines; solar PV is dc. 15

17. US Generator Capacity Additions 16 Total US Generation Capacity is about 1000 GW

18. Basic Steam Power Plant Rankine Cycle: Working fluid (water) changes between gas and liquid 17

19. Carnot Efficiency of Heat Engines Heat engines use differences in temperature to convert part of the heat from a high temperature source, Q H, into work, W, with output heat Q C – Examples are fossil fuel generators, nuclear generators, concentrated solar generators and geothermal generator 18

20. Modern Coal Power Plant 19

21. Basic Gas Turbine Brayton Cycle: Working fluid is always a gas Most common fuel is natural gas Typical efficiency is around 30 to 35% 20

22. Gas Turbine Source: Masters 21

23. Combined Heat and Power Overall Thermal Efficiency = 33% (Electricity) + 53% (Heat) = 86% 22

24. Combined Cycle Power Plants Efficiencies of up to 60% can be achieved, with even higher values when the steam is used for heating 23

25. Determining operating costs In determining whether to build a plant, both the fixed costs and the operating (variable) costs need to be considered. Once a plant is build, then the decision of whether or not to operate the plant depends only upon the variable costs Variable costs are often broken down into the fuel costs and the O&M costs (operations and maintenance) 24

26. Heat Rate Fuel costs are usually specified as a fuel cost, in $/Mbtu, times the heat rate, in MBtu/MWh – Heat rate = 3.412 MBtu/MWh/efficiency – Example, a 33% efficient plant has a heat rate of 10.24 Mbtu/MWh – About 1055 Joules = 1 Btu – 3600 kJ in a kWh The heat rate is an average value that can change as the output of a power plant varies. Do Example 3.5, material balance 25

27. Fixed Charge Rate (FCR) The capital costs for a power plant can be annualized by multiplying the total amount by a value known as the fixed charge rate (FCR) The FCR accounts for fixed costs such as interest on loans, returns to investors, fixed operation and maintenance costs, and taxes. The FCR varies with interest rates, and is now typically below 10% For comparison this value is often expressed as $/yr-kW 26

28. Annualized Operating Costs The operating costs can also be annualized by including the number of hours a plant is actually operated Assuming full output the value is Variable ($/yr-kW) = [Fuel($/Btu) * Heat rate (Btu/kWh) + O&M($/Kwh)]*(operating hours/hours in year) 27

29. Coal Plant Example Assume capital costs of $4 billion for a 1600 MW coal plant with a FCR of 10% and operation time of 8000 hours per year. Assume a heat rate of 10 Mbtu/MWh, fuel costs of 1.5 $/Mbtu, and variable O&M of $4.3/MWh. What is annualized cost per kWh? Fixed Cost($/kW) = $4 billion/1.6 million kW=2500 $/kW Annualized capital cost = $250/kW-yr Annualized operating cost = (1.5*10+4.3)*8000/1000 = $154.4/kW-yr Cost = $(250 + 154.4)/kW-yr/(8000h/yr) = $0.051/kWh 28

30. Capacity Factor (CF) The term capacity factor (CF) is used to provide a measure of how much energy an plant actually produces compared to the amount assuming it ran at rated capacity for the entire year CF = Actual yearly energy output/(Rated Power * 8760) The CF varies widely between generation technologies, 29

31. Generator Capacity Factors Source: EIA Electric Power Annual, 2007 The capacity factor for solar is usually less than 25% (sometimes substantially less), while for wind it is usually between 20 to 40%). A lower capacity factor means a higher cost per kWh 30

32. In the News UI is building a new "solar farm" on 21 acres just south of Windsor and west of First Street Farm has a 5.9 MW peak capacity, and is estimated to produce 7860 MWh per year – This gives it a capacity factor of 7860/(5.9*8760) = 15.2% – Will supply about 2% of the campus electric load Project will be built and operated by Phoenix Solar for ten years, with UI buying all the output for about $1.5 million per year – Energy cost is $1.5million/7860MWh = $0.19/kWh – But after ten years UI takes ownership with no additional cost 31 Source: News-Gazette, January 21, 2015