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www.eppsa.eu
Thermal Power Generation in 2030
Added Value for EU Energy Policy
Prof. Emmanouil Kakaras
EPPSA President
17th November 2014
European Energy Forum
Brussels, Belgium
Page 2
Thermal Power Generation in 2030 - Added value for EU Energy Policy
I. EPPSA
II. EU 2030 Targets
III. EPPSA Study: Thermal Power In 2030
Different scenarios, similar conclusions
New-build database
IV. Conclusions
Page 3
I. EPPSA
The European Power Plant Suppliers Association
The European Power Plant Suppliers Association (EPPSA) is the voice, at European level, of companies supplying power plants, components and services. EPPSA members, located throughout Europe, represent a leading sector of technology with more than 100,000 employees.
EPPSA actively promotes awareness of the importance of flexible and efficient, state-of-the-art thermal power generation and its crucial contribution to ensuring a clean, secure, and affordable energy supply.
EPPSA believes increased investment in Research, Development and Demonstration is a key factor in driving EU competitiveness as well as ensuring an affordable low emission power supply.
Virtually all thermal power plants in the EU are built by members of EPPSA or equipped with their components, and around 50% of Europe’s electricity.
EPPSA members provide the most advanced thermal power technologies in the world.
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 4
I. EPPSA
Our Members
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 5
I. EPPSA
II. EU 2030 Targets
III. EPPSA Study: Thermal Power In 2030
Different scenarios, similar conclusions
New-build database
Conclusions
Future Added Value Of Thermal Power Plants
IV. Conclusions
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 6
III. 2030 Targets
On the 23rd October 2014 the European Council concluded on its 2030 energy and climate targets:
- At least 40% emissions reduction from 1990 levels by 2030 (nationally binding)
- At least 27% energy efficiency increase by 2030 (binding only at EU level)
- At least 27% renewable energy share by 2030 (binding only at EU level)
- A revised EU ETS
- Energy Security
So what is the place for Thermal Power as we move towards 2030?
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 7
I. EPPSA
II. EU 2030 Targets
III. EPPSA Study: Thermal Power In 2030
Different scenarios, similar conclusions
Generation Mix in 2030
Capacity Mix in 2030
Thermal Capacity in 2030
Capacity Investments Required, 2010-2030
New-build database
Conclusions
Future Added Value Of Thermal Power Plants
IV. Conclusions
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 8
IV. EPPSA Study: Thermal Power In 2030
Different scenarios, similar conclusions
24 scenarios from 7 studies were examined with regard to their results for the EU energy system in 2030.
They were specifically examined and compared with regard to the generation mix, the installed capacity and the additional capacity of thermal power needed by 2030 to account for decommissioning of existing plants.
JRC (2009) Future Fossil Fuel Electricity Generation in Europe: Options
and Consequences (JRC)
Eurelectric (2009) Power Choices: Pathways to Carbon-Neutral Electricity in
Europe by 2050 (Eurelectric)
Greenpeace (2010) Energy (R)Evolution: Towards a Fully Renewable Energy Supply
in the EU-27 (Revolution and Adv. Revolution)
European Climate
Foundation (2011)
Power Perspectives 2030: On the Road to a Decarbonised
Power Sector (ECF)
DG ENER (2011) Energy Roadmap 2050 (RM2050)
DG ENER (2013) EU Energy Trends to 2050 (DG ENER)
ENTSO-E (2013) 2030 Visions (ENTSO-E)
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 9
IV. EPPSA Study: Thermal Power In 2030
Generation Mix in 2030
Share of thermal power generation in the 2030 generation mix
never falls below 1/3rd.
Generation Mix in 2030
55.8 53.3
43.2 44.540.3
48.441 38.7 37.5 34.1 36.8
43
27.5
18.5
24.5 20.721.8 4.8
3.3
18.6 21.2
15.8
21.513.4
16.6
28.232.3 34.8 37.9
46.955.7
42.8 41.350.1
41.8 43.7
0%
25%
50%
75%
100%
2010
Ref
eren
ce (D
G E
NER)
Ref
eren
ce (Gre
enpe
ace)
Ref
eren
ce (RM
205
0)
CPI (
RM
205
0)
Ref
eren
ce (DG
ENER)
E(R
) (Gre
enpe
ace)
Adv
. E(R
) (G
reen
peac
e)
EE (R
M 2
050)
DST
(RM
205
0)
RES (R
M 2
050)
Del. C
CS (R
M 2
050)
L. N
uc (R
M 2
050)
Scenario
% o
f to
tal
Thermal (inc. biomass) Nuclear RES
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 10
IV. EPPSA Study: Thermal Power In 2030
Capacity Mix in 2030
In only 2 scenarios share of thermal power below 1/3rd .
In these scenarios this capacity still produces 41 - 48.4% of total electricity;
Capacity Mix in 2030
57.5
44 42.3 43.2 39.344
32.727.4
38.1 37.2 33.4 36.9 38.6
15.7
9.7 11 99.4
12
2
1.4
7.3 8.86.8
8.9 5.2
27
46.4 46.7 47.8 5143.9
65.371.3
54.5 5459.9
54.2 56.2
0%
25%
50%
75%
100%
2010
Ref
eren
ce (D
G E
NER)
Ref
eren
ce (Gre
enpe
ace)
Ref
eren
ce (RM
205
0)
CPI (
RM
205
0)
Ref
eren
ce (DG
ENER)
Pow
er C
hoices
(Eur
elec
tric)
E(R
) Gre
enpe
ace
Adv
. E(R
) (G
reen
peac
e)
EE (R
M 2
050)
DST
(RM
205
0)
RES (R
M 2
050)
d. C
CS (R
M 2
050)
l. NUC (RM
205
0)
Scenario
% o
f to
tal
Thermal (inc. biomass) Nuclear RES
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 11
IV. EPPSA Study: Thermal Power In 2030
Thermal Capacity in 2030
All scenarios show a substantial installed capacity in 2030.
In scenarios with lowest capacity, total installed thermal capacity is 335 GW.
In most non-reference/baseline scenarios, the total installed thermal power capacity is between 423 – 485 GW, not very different from the 2010
Reference case of 479 GW.
Thermal Capacity in 2030
175.8 159133.6 123.2 104
174
40 17
106.1 107.9 107.5 107.1 115 116.5 116.5 111.9 103.8
225 242
238.8 256.1
258
230228
219 230 227.2 230.4236.7 234 220
276.7270.6
5429
47.6 32.8 24
13
13
24.129.3 29.3 28.1
3011.2
11.2
16.216.2
2539 72 73.5
39
53
7677
74.676.7 77.7 76.9
81.3
50.150.1
50.749
281
0
100
200
300
400
500
600
2010
Ref
eren
ce (D
G E
NER)
Ref
eren
ce (Gre
enpe
ace)
Ref
eren
ce (RM
205
0)
CPI (
RM
205
0)
Ref
eren
ce (DG
ENER)
Pow
er C
hoices
(Eur
elec
tric)
E(R
) Gre
enpe
ace
Adv
. E(R
) (G
reen
peac
e)
EE (R
M 2
050)
DST
(RM
205
0)
RES (R
M 2
050)
d. C
CS (R
M 2
050)
l. NUC (RM
205
0)
Slow P
rogr
ess
(ENT
SO-E
)
Mon
ey R
ules
(ENTS
O-E
)
Gre
en T
rans
ition
(ENT
SO-E
)
Gre
en R
evolut
ion
(ENTS
O-E
)
Scenario
Cap
acit
y In
sta
lled
(G
W)
Solids Gas Oil Biomass/Waste/CHP
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 12
IV. EPPSA Study: Thermal Power In 2030
Capacity Investments Required, 2010-2030
2010-2030 period: investment in dispatchable capacity needed for generation adequacy
Between 166 and 234.3 GW of new thermal power capacity needed.
Capacity Investments Required, 2010-2030
435
265.5290
232 228
310
234.3
166187 183 184
204
11 3
62.9
3 4 3 3 8
275.9 277.2
359
0
100
200
300
400
500
Busin
ess
As Usu
al (J
RC)
Basel
ine
(Eur
elec
tric)
Ref
eren
ce (D
G E
NERa)
Ref
eren
ce (R
M 2
050)
CPI (
RM
2050
)
Low C
arbo
n Policy
(JRC)
Power C
hoices
(Eur
elect
ric)
EE (R
M 2
050)
DST (R
M 2
050)
RES
(RM
205
0)
d. C
CS (R
M 2
050)
l. NUC
(RM
2050
)
Ref
eren
ce (D
G E
NERb)
Hig
her R
ES (D
G E
NER
b)
Low X
B Tra
de (D
G E
NERb)
Scenario
Ca
pa
cit
y I
nv
es
tme
nt
(GW
)
Thermal CCS Total Dispatchible Plants
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 13
IV. EPPSA Study: Thermal Power In 2030
Capacity Investments Required, 2010-2030
Although grid stability demands a back-up system provided by thermal PPs,
and old fleet reaches end of the lifetime many new projects have been
cancelled or postponed
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 14
IV. EPPSA Study: Thermal Power In 2030 summary
Different scenarios, same conclusions
Thermal Power share in generation mix 2030 decreases in all scenarios, however, it never falls below a third.
Thermal Power percentage of the total installed capacity will decrease by 2030 to between 27.4% and 44% (versus 55.8% in the 2010 reference case)
Share of Thermal Capacity decreases (in all but one scenario), but the absolute thermal capacity will range from 423-485 GW (similar to 479 GW in the 2010 reference case)
Significant investment in dispatchable capacity – thermal power in particular – is required to maintain generation adequacy. Between 166 and 234.3 GW additions will be required, which translates to 39.4 and 48.3% of installed thermal power capacity to be built before 2030.
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 15
I. EPPSA
II. EU 2030 Targets
III. EPPSA Study: Thermal Power In 2030
Different scenarios, similar conclusions
New-build database
IV. Conclusions
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 16
IV. EPPSA Study: Thermal Power In 2030
A. New-build Database
EPPSA and its members have been assembling a database, covering the efficiency and emissions of thermal power plants before and after retrofitting/refurbishing
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 17
IV. EPPSA Study: Thermal Power In 2030
A. New-build Database
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Total Net capacity replaced 22,0 GW
495 GW installed
Investments from 2000 to 2015 27,4 billion €
Saved fuel cost until 2030 29,1 billion €
Saved CO2 emissions per year 57,37 million t/a
Saved CO2 emissions until 2030 1,25 billion t
Average saved fuel (meaning saved CO2 emissions)
32 %
CO2 avoidance cost over 20 years 23,92 €/t
Real Cost / saved ton of CO2 (Capex, Opex, saved fuel, saved allowances)
-19,58 €/t
Page 18
IV. EPPSA Study: Thermal Power In 2030
B. Flexible Technologies
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Balancing necessities today (Germany, as an example):
Ideal: high renewable
generation, wind and
sun; minimum thermal
Often reality: very low
renewable generation,
wind and sun; thermal
fills the gap
Page 19
IV. EPPSA Study: Thermal Power In 2030
B. Flexible Technologies
Thermal Power Generation in 2030 - Added value for EU Energy Policy
System needs flexible plants with improved efficiency at part-load. Therefore capacity markets need to support only plants meeting
flexible requirements
Increasingly variable supply and demand => even faster ramping in the future:
Current average fleet performance for ramp rate: (Germany) Hard coal: 1,5 %MCR/min
Lignite: 1 %MCR/min
CCGT: 2 %MCR/min
State-of-the-art for EPPSA members: Hard coal: 4-5 %MCR/min
Lignite: 3-4 %MCR/min
CCGT (average): 5-6 %MCR/min
Page 20
IV. EPPSA Study: Thermal Power In 2030
C. …and what about Carbon Lock-in?
Thermal Power Generation in 2030 - Added value for EU Energy Policy
What is the carbon lock-in effect
Different definitions exist.
Very often used to indicate that when we build plants today, they
will still be in operation in 2050, making a decarbonisation of
the Electricity System impossible by 2050.
Page 21
IV. EPPSA Study: Thermal Power In 2030
C. …and what about Carbon Lock-in?
Thermal Power Generation in 2030 - Added value for EU Energy Policy
The merit order (traditional)
Page 22
IV. EPPSA Study: Thermal Power In 2030
C. …and what about Carbon Lock-in?
Thermal Power Generation in 2030 - Added value for EU Energy Policy
The merit order (with wind or solar)
Page 24
IV. EPPSA Study: Thermal Power In 2030 C. What about Carbon Lock-in?
Thermal Power Generation in 2030 - Added value for EU Energy Policy
We have seen that the needed thermal power capacity plays a “servicing” role:
Question: Is there really a lock-in or a necessary contributor?
Page 25
IV. EPPSA Study: Thermal Power In 2030 C. What about Carbon Lock-in?
Thermal Power Generation in 2030 - Added value for EU Energy Policy
It is indeed a clear choice:
Necessity to balance the system
Response from modern thermal power is necessary as they are the only able to render the full fledge services of :
Variable energy resources balancing;
System security; and
Grid services
even if no dispatchable RES are available
Political choice to achieve this with older, more costly or with modern, cleaner, more flexible and cost effective plants
Question: Is there really a lock-in or a necessary contributor?
Page 26
I. EPPSA
II. EU 2030 Targets
III. EPPSA Study: Thermal Power In 2030
Different scenarios, similar conclusions
New-build database
IV. Conclusions
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 27
V. Conclusions –policies to encourage investment
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Since 2000 reserve margin of EU as a whole sufficient; 2010 – 33% However MSs below the reserve margin threshold of 15% in the short term. In Belgium and Germany the short-fall due to nuclear phase out In Finland due to delays in nuclear commissioning “Taking import capacities into account the EU market is likely to exhibit robust reserve margins in 2015.”
But will it really do so?
Page 28
V. Conclusions –policies to encourage investment
- Thermal Power Plants must remain the back bone of the European Electricity System (never fall below 1/3rd of generation mix)
- Security of supplies is seriously threatened by insufficient investment in new Thermal Power plants whilst old plants are being closed eg …
In June 2014, the de-rated margin in the UK was predicted by OFGEM to fall to 2% in 2015 and this will only improve due to the introduction of a “Capacity Market”. Since the summer the risks this winter have worsened due to extended unplanned outages at coal, gas and nuclear power plants
In Sept 2014, ELIA the Belgian TSO published its strategy for rolling power-cuts in view of “the very real risk of power shortages as winter approaches”
It is clear that doing nothing will not be enough and will lead to power shortages.
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 29
V. Conclusions –policies to encourage investment
EPPSA recommends that EU and Member State policy makers take more careful account of the essential contribution that will be required by Thermal Power plants (baseload and flexible) through to 2030
Assess accordingly the impact of new policies on electricity markets, affordability, investment, business opportunities and R, D & D (research, development and demonstration).
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 30
V. Conclusions – R+D
- However, due to the ever increasing number of intermittent RES, and the corresponding increase in load variation, more and more steep ramping rates for back-up power will be necessary.
- Current challenges can already be met today by newly built plants:
- Many newly built power plants can operate down to 30% of their normal load.
- The ramping rates of new plants can be up to 6% (and even up to 8% with added fuels) of installed capacity per minute
- Services for grid stability, balancing needs, etc.
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Continuous efforts on implementing innovation into new thermal plants will guarantee that future requests regarding the flexible performance and back up role of thermal power can be met!
Page 31
V. Conclusions R+D
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Flexible and efficient power plants research and innovation is supported in H2020 under the LCE 17:
Highly flexible and efficient fossil fuel power plants
There is a clear need for further R,D&D
Which is oversubscribed for the WP2014-2015
We therefore call for flexible and efficient fossil fuel power generation to be replicated in the Energy WP 2016-2017 with adequate funding
Page 32
V. Conclusions
Added Value of Thermal Power Plants
Suitable policies to encourage investment and R+D will guarantee the added value of Thermal Power Plants in the European Energy System:
Affordability
Security of supply
Sustainability
Technological leadership, business and quality jobs
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Page 33
Thermal Power Generation in 2030
Added Value for EU Energy Policy
Thermal Power Generation in 2030 - Added value for EU Energy Policy
Thank you for your attention!
Page 34
EPPSA – European Power Plant Suppliers Association
Avenue Adolphe Lacomblé 59 | B - 1030 Brussels Tel: +32 2 743 2986 | Fax: +32 2 743 2990 info@eppsa.eu www.eppsa.eu
Secretary General: Patrick Clerens p.clerens@eppsa.eu
Policy Officer: Nicolas Kraus n.kraus@eppsa.eu
Members
Contact Details
Thermal Power Generation in 2030 - Added value for EU Energy Policy
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