1. The Effects of Greenhouse Gas Limits on Electric Power System Dispatch and Operations Miaolei Shao (mxshao@wichita.edu) Ward Jewell (ward.jewell@wichita.edu) Department of Electrical and Computer Engineering Wichita State University PSERC Tele-Seminar September 2 nd, 2008 1

2. Greenhouse Gas (GHG) Emissions & Electric Power Industry United States is the source of 1/4 of the world’s GHG emissions. Electric power industry accounts for 38 percent of the nation’s overall carbon dioxide (CO 2 ) emissions and one-third of the overall U.S. GHG emissions. 39 states have or are developing State Action Plans specially targeting GHG emission reductions. -- Regional Greenhouse Gas Initiative (RGGI) -- California Assembly Bill 32 (AB 32) 2

3. Electric Power System Features That Impact CO 2 Emissions CO 2 emission factors by type of fuel Unit thermal efficiency Regional generation mix Electricity demand Transmission constraints 3

4. CoalEFOilEFGasEF Bituminous205Distillate oil161Natural gas117 Subbituminous213Jet fuel156Propane139 Lignite215Kerosene159 Anthracite227Petroleum coke225 Residual174 Source: S. Goodman, M. Walker, “Benchmarking air emissions of the 100 largest electric power producers in the united states – 2004”, Apr. 2006 CO 2 Emission Factors (EF) by Type of Fuel (lb CO 2 /MBtu) 4

5. G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) P1 = 400 MW 800 MW Load P2 = 400 MW 400 MW Bus 1 Bus 2 Two-bus, two-generator power system CO 2 Emission Factors (EF) by Type of Fuel (Cont.) Heat rate data of 400 MW fossil fired generation units came from “A. J. Wood, B. F. Wollenberg, Power Generation, Operation, and Control, John Wiley & Sons, 1996.” CO 2 emission factor is 215 lbs/Mbtu for coal and 117 lbs/Mbtu for gas. 5

6. G1 (400 MW coal-fired generation unit) Efficiency (400 MW) Efficiency + 1%Efficiency + 3% Efficiency (%)37.9%38.9%40.9% CO 2 emissions (tons/h)345.5336.7320.2 CO 2 emission reduction (%)N/A-2.5%-7.3% G2 (400 MW gas-fired generation unit) Efficiency (400 M) Efficiency + 1%Efficiency + 3% Efficiency (%)35.9%36.9%38.9% CO 2 emissions (tons/h)198.5193.1183.2 CO 2 emission reduction (%)N/A-2.7%-7.7% Unit thermal Efficiency and CO 2 Emissions One kilowatt hour (kWh) has a thermal equivalent of approximately 3412 Btu. 6

7. Regional Generation Mix & CO 2 Emissions G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) P1 = 400 MW 600 MW Load P2 = 200 MW 400 MW Bus 1 Bus 2 G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) P1 = 400 MW 600 MW Load P2 = 0 MW 600 MW Bus 1 Bus 2 G3 (400 MW coal- fired generation unit) P3 = 200 MW Two-bus, two-generator power system Two-bus, three-generator power system 7

8. Regional Generation Mix & CO 2 Emissions (Cont.) (G2) (G3) (G1) 450 527 8

9. Electricity Demand & CO 2 Emissions G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) P1 = 400 MW 600 MW Load P2 = 200 MW 400 MW Bus 1 Bus 2 Two-bus, two-generator power system 400 MW Load 800 MW Load P2 = 0 MW P2 = 400 MW 800 400 600 Load L (MW) Hours load equals or exceeds L MW Load-duration curve 9

10. Electricity Demand & CO 2 Emissions (Cont.) CO 2 emission amounts (tons/h) CO 2 emission rates (tons/MWh) 10

11. Transmission Constraints & CO 2 Emissions G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) P1 = 400 MW 600 MW Load P2 = 200 MW 400 MW Bus 1 Bus 2 G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) P1 = 300 MW 600 MW Load P2 = 300 MW 300 MW Bus 1 Bus 2 400 MW maximum transmission capability between bus 1 and bus 2 300 MW maximum transmission capability between bus 1 and bus 2 11

12. Transmission Constraints & CO 2 Emissions (Cont.) (G1) (G2) 450 412 Transmission congestion help reduce system CO 2 emissions? 12

13. CO 2 Emission-incorporated Cost Model Input-output function Fuel cost function CO 2 emission cost function Fuel-emission cost function 13

14. Fossil-fired Generation Units’ Cost Variation Due to CO 2 Emissions G1 (400 MW coal- fired generation unit) G2 (400 MW gas- fired generation unit) Coal price is 1.90 $/MBtu CO 2 emission factor of coal is 215 lb/MBtu Gas price is 3.80 $/MBtu CO 2 emission factor of gas is 117 lb/MBtu CO 2 price is 30 $/ton Fuel costs CO 2 emission costs Fuel-emission costs 14

15. Breakeven Price of CO 2 Gas price is 3.8 $/MBtu Breakeven price of CO 2 is around 50 $/ton Gas price is 5.7 $/MBtu Breakeven price of CO 2 is around 100 $/ton Coal price is 1.90 $/MBtu Coal CO 2 emission factor is 215 lb/MBtu Gas CO 2 emission factor is 117 lb/MBtu 15

16. CO 2 Emission-constrained ac Optimal Power Flow (OPF) Objective function Equality constraints Inequality constraints Linear Programming Software used in this research: PowerWorld Simulator 16

17. IEEE Reliability Test System (RTS) 24 buses 38 transmission lines and transformers. a total load of 2850 MW a total generation capacity of 3405 MW 17

18. Case # Description Fuel Prices ($/MBtu) System Load (MW) CoalGasOil 1 Medium fuel price and normal system load 1.889.0912.001995 2 High fuel price and normal system load 1.9512.7416.371995 3 Medium fuel price and peak system load 1.889.0912.002850 4 High fuel price and peak system load 1.9512.7416.372850 Simulation Cases and Description 18

19. 70 $/ton180 $/ton280 $/ton Simulation Results of Case 1 At CO 2 price of 70 $/ton, coal and gas power generation start to shift. At CO 2 price of 180 $/ton, gas power generation almost equals coal power generation. At CO 2 price of 280 $/ton, major shifting process is finished. CO 2 emissions decrease from 928 tons/h at CO 2 price of 0 $/ton to 514 tons/h at CO 2 price of 280 $/ton, a 44.6% reduction. The system fuel costs increase from 18595 $/h at CO 2 price of 0 $/ton to 79255 $/h at CO 2 price of 280 $/ton, a 326% increase. 19

20. 70 $/ton180 $/ton280 $/ton Simulation Results of Case # 1 (Cont.) 20

21. Simulation Results Case # 1 Case # 2 21 70 $/ton180 $/ton280 $/ton130 $/ton270 $/ton410 $/ton

22. Simulation Results (Cont.) Case # 3 Case # 4 22 80 $/ton180 $/ton 130 $/ton260 $/ton

23. Conclusions CO 2 emissions from electric power industry are impacted by several power system features; ignoring any of them will incur errors in analysis. CO 2 emission-constrained ac OPF is a powerful tool that considers all the features that impact CO 2 emissions from electric power generation. CO 2 emission-constrained ac OPF, which can be realized in commercial and educational power system software or developed as stand-alone software, has potential to be utilized for investigating and assessing the effects, including costs and reliability, of GHG limits on electric power industry. Simulation results indicate that the effects of GHG limits on electric power system dispatch and operations are sensitive to several factors such as system load levels, fuel prices etc. In current high gas price situation, it is quite expensive to reduce CO 2 emissions by switching from coal power generation to gas power generation. 23

24. Future Research PSERC Project M21: “Technical and Economic Implications of Greenhouse Gas Regulation in a Transmission Constrained Restructured Electricity Market” Academic Team Members: Ward Jewell (lead), Wichita Shmuel Oren, UC Berkeley Chen-Ching Liu, University College Dublin Yishu Chen, UC Merced Industry Team Members: Jim Price, CAISO Mariann Quinn, Duke Energy Floyd Galvan, Entergy Mark Sanford, GE Jay Giri, AREVA Tongxin Zheng, ISO-NE Ralph Boroughs, TVA Robert Wilson, WAPA Avnaesh Jayantilal, AREVA Jerry Pell, DOE Sundar Venkataraman, GE Energy 24

25. Thank You 25