The role of cogeneration in meeting future worldwide power needs
World DE and Sustainable Energy Trends 16 May 2006
Michael Brown World Alliance for Decentralized Energy (WADE)
What is Decentralized Energy (DE)?
Electricity production at the point of use, irrespective of size, fuel or technology – on-grid or off-grid: • High efficiency CCHP • On-site renewable energy • On-site industrial energy recycling
2
Decentralized Energy – Some Choices
Reciprocating Engines Large & small Gas Turbines
PV Stirling Engines Fuel Cells
Microturbines
3
Worldwide energy waste Electricity Generation Worldwide (TWh) (source: International energy Agency)
4
World All-Energy Investment, 2001 - 2030 Network investment needs exceed generation needs by 17%
Gas 19%
Coal 2%
Oil 19%
Electricity 60%
46%
Power generation
54%
Network T&D
$5.2 trillion of investment Source: International Energy Agency, 2003 Reference Scenario – Business-as-Usual
5
The Most Important Question DE and CCHP reduce emissions and are good for energy efficiency Is it also economically rational? The WADE Model answers that question
6
WADE DE Economic Model Object To compare cost of DE and of central power in providing new electricity demand growth over next 20 years Also compares emissions and fuel use
Model ‘builds’ new capacity to meet demand growth and replace old plant Wide range of inputs determine what capacity is built and how much Takes account of peak time network losses
Can be applied to any country / region / city in the world
7
China – retail costs for new capacity to 2021 Retail Costs per KWh for Incremental 2021 Load 10
US$ Cents / KWh
8
6
4
2
0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
0% CG / 100% DE
% DE of Total Generation
O&M of New Capacity Capital Amortization + Profit On New Capacity
Fuel T&D Amortization on New T&D
8
China – capital cost for new capacity to 2021 Capital Cost to Supply Incremental Electricity Load to 2021
Billion US$ for New Capacity
1,200 1,000 800 600 400 200 0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
% DE of Total Generation Inv. In New CG
Inv. in new DE
9
Inv. In T&D
0% CG / 100% DE
China – CO2 emissions from new capacity to 2021 Added Annual CO2 Emissions for Incremental Year 20 Load 800
Million Metric Tonnes / Year
700 600 500 400 300 200 100 0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
% DE of Total Generation
CO2 emitted for added CG
10
0% CG / 100% DE
CO2 emitted for added DE
China – fossil fuel use for new capacity to 2021 Added Annual Fossil Fuel Use for Incremental year 20 Load
Exajoules (EJ) of Fossil Fuel / Year
20 18 16 14 12 10 8 6 4 2 0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
% DE of Total Generation Total "New" CG Fuel Use
11
0% CG / 100% DE
Total "New" DE Fuel Use
WADE Economic Model Other WADE Model Applications Canada - Federal Government of Canada (Natural Resources Canada) EU - European Commission – DG-FER programme Ireland - Government of Ireland (Sustainable Energy Ireland) Sri Lanka – European Commission Germany – IZES for the Ministry of Environment UK – Greenpeace UK USA – Primary Energy Inc.
12
World DE Use is Increasing
DE % share of new generation
25
20
15
10
5
Source: WADE 2006
13
2005
2004
2003
2002
0
CCHP in the USA
90
Installed Capacity (GWe)
80 70 60 50 40 30 20 10 0 2005
2004
2003
2002
2000
1998
14
1996
1994
1992
1990
1988
1986
1984
1982
1980
Source: US CHP Association 2006
Drivers of DE and CCHP in the Future
Future Energy Prices shaped by World Energy Demand
Source: International Energy Agency 2006
16
Future Energy Use shaped by Climate Challenge
17
What is possible
Source: Danish Energy Center
18
Michael Brown World Alliance for Decentralized Energy (WADE)
What is Decentralized Energy (DE)?
Electricity production at the point of use, irrespective of size, fuel or technology – on-grid or off-grid: • High efficiency CCHP • On-site renewable energy • On-site industrial energy recycling
2
Decentralized Energy – Some Choices
Reciprocating Engines Large & small Gas Turbines
PV Stirling Engines Fuel Cells
Microturbines
3
Worldwide energy waste Electricity Generation Worldwide (TWh) (source: International energy Agency)
4
World All-Energy Investment, 2001 - 2030 Network investment needs exceed generation needs by 17%
Gas 19%
Coal 2%
Oil 19%
Electricity 60%
46%
Power generation
54%
Network T&D
$5.2 trillion of investment Source: International Energy Agency, 2003 Reference Scenario – Business-as-Usual
5
The Most Important Question DE and CCHP reduce emissions and are good for energy efficiency Is it also economically rational? The WADE Model answers that question
6
WADE DE Economic Model Object To compare cost of DE and of central power in providing new electricity demand growth over next 20 years Also compares emissions and fuel use
Model ‘builds’ new capacity to meet demand growth and replace old plant Wide range of inputs determine what capacity is built and how much Takes account of peak time network losses
Can be applied to any country / region / city in the world
7
China – retail costs for new capacity to 2021 Retail Costs per KWh for Incremental 2021 Load 10
US$ Cents / KWh
8
6
4
2
0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
0% CG / 100% DE
% DE of Total Generation
O&M of New Capacity Capital Amortization + Profit On New Capacity
Fuel T&D Amortization on New T&D
8
China – capital cost for new capacity to 2021 Capital Cost to Supply Incremental Electricity Load to 2021
Billion US$ for New Capacity
1,200 1,000 800 600 400 200 0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
% DE of Total Generation Inv. In New CG
Inv. in new DE
9
Inv. In T&D
0% CG / 100% DE
China – CO2 emissions from new capacity to 2021 Added Annual CO2 Emissions for Incremental Year 20 Load 800
Million Metric Tonnes / Year
700 600 500 400 300 200 100 0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
% DE of Total Generation
CO2 emitted for added CG
10
0% CG / 100% DE
CO2 emitted for added DE
China – fossil fuel use for new capacity to 2021 Added Annual Fossil Fuel Use for Incremental year 20 Load
Exajoules (EJ) of Fossil Fuel / Year
20 18 16 14 12 10 8 6 4 2 0 100% CG / 0% DE
75% / 25%
50% / 50%
25% / 75%
% DE of Total Generation Total "New" CG Fuel Use
11
0% CG / 100% DE
Total "New" DE Fuel Use
WADE Economic Model Other WADE Model Applications Canada - Federal Government of Canada (Natural Resources Canada) EU - European Commission – DG-FER programme Ireland - Government of Ireland (Sustainable Energy Ireland) Sri Lanka – European Commission Germany – IZES for the Ministry of Environment UK – Greenpeace UK USA – Primary Energy Inc.
12
World DE Use is Increasing
DE % share of new generation
25
20
15
10
5
Source: WADE 2006
13
2005
2004
2003
2002
0
CCHP in the USA
90
Installed Capacity (GWe)
80 70 60 50 40 30 20 10 0 2005
2004
2003
2002
2000
1998
14
1996
1994
1992
1990
1988
1986
1984
1982
1980
Source: US CHP Association 2006
Drivers of DE and CCHP in the Future
Future Energy Prices shaped by World Energy Demand
Source: International Energy Agency 2006
16
Future Energy Use shaped by Climate Challenge
17
What is possible
Source: Danish Energy Center
18
