direct use of natural gas. tampa electric peoples gas
TRANSCRIPT
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TECO Energy
Tampa Electric•660,000 customers•Over 4,400 megawatts of generating capacity Peoples Gas•330,000 customers•Over 10,000 miles of distribution mainand 113 miles of transmission main
Direct Use of Natural Gas Implications for Power Generation, Energy Efficiency, and Carbon Emissions
Study Conducted by Black & Veatch Corporation
February 2008
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Observations for Natural Gas
•Tight supply market •Demand remains strong
•Use for power generation expected toincrease significantly
•GHG emissions regulations likely to put further strain on the market
•Drivers of Natural Gas Demand Remain Strong
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Observations for Natural Gas•Drivers of Natural Gas Demand Remain Strong
• Direct use of natural gas delivers 90% energy efficiency to end users – as compared to 27% end use efficiency when natural gas is used to generate electricity
• Direct use of natural gas in home heating and water heating results in 40% less CO2 emissions than electricity
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Study Objectives
• Analyze increased use of natural gas for power generation and impact on the natural gas market
• Assess impact of increasing direct use of natural gas for residential & commercial (R&C) end uses
Space Heating Water Heating Cooking Clothes Drying
• Quantify impact of increased direct use of natural gas on
Energy Consumption Total Energy Costs CO2 Emissions
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Analysis Approach
Assumptions
Analysis to be performed in scenario
based conditions
Assumptions on the extent of shift in R&C
demand
Use of AGA & AGF studies, EIA’sAEO 2007 and other public sources
to support analysis
Analysis
Define Scenarios
Assess shift in R&C demand from electricity to direct use of gas
Impact of Increase in gas demand
Impact of decrease in electricity demand
Net impact on the US market as captured by defined metrics
Metrics
Energy Consumption
Energy Cost
CO2 Emissions
Assumptions
Analysis to be performed in scenario
based conditions
Assumptions on the extent of shift in R&C
demand
Use of AGA & AGF studies, EIA’sAEO 2007 and other public sources
to support analysis
Analysis
Define Scenarios
Assess shift in R&C demand from electricity to direct use of gas
Impact of Increase in gas demand
Impact of decrease in electricity demand
Net impact on the US market as captured by defined metrics
Metrics
Energy Consumption
Energy Cost
CO2 Emissions
Study Conducted by Black & Veatch
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Scenarios Assessed
Reference Base Case1. Current Supply/2006 R&C Technology/No CO2 Restrictions
Natural Gas Constrained World / High CO2 Restrictions with:2. 2006 R&C Technology
or3. High Technology (based on future efficiency targets)
Natural Gas Surplus World / Low CO2 Restrictions with:4. 2006 R&C Technology
or5. High Technology (based on future efficiency targets)
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Study Findings
Increased use of natural gas in R&C applications can
Decrease energy consumption
Decrease power generation needs
Reduce overall energy cost
Reduce CO2 emissions
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Impact on Energy Consumption in 2030
-2.50
-2.00
-1.50
-1.00
-0.50
0.00
Reference Case High CO2-High Tech High CO2-2006 Tech Low CO2-High Tech Low CO2-2006 Tech
Qu
ad
rilli
on
Btu
Source: Energy Information Administration (“EIA”), B&V Analysis
Increased Direct Use Of Natural GasIncreased Direct Use Of Natural GasReduces Total Energy ConsumedReduces Total Energy Consumed
A 50% shift of the switchable electric load to natural gas end use can produce:
• Energy Savings = 1.25 to 2.00 quadrillion Btu
• Avoided Generation capacity = 63 to 80 GW
• Avoided Investment costs = $49B to $122B
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Impact on Energy Costs in 2030
Increased Direct Use Of Natural Gas Increased Direct Use Of Natural Gas Reduces Total Energy CostsReduces Total Energy Costs
In supply-constrained/Lieberman-Warner CO2 restrictions scenario, Energy Savings = $18B to $29B by 2030
Source: Energy Information Administration (“EIA”), B&V Analysis
-30.00
-25.00
-20.00
-15.00
-10.00
-5.00
0.00
Reference Case High CO2-High Tech High CO2-2006 Tech Low CO2-High Tech Low CO2-2006 Tech
20
05
$ B
illio
n
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Impact on CO2 Emissions in 2030
Source: Energy Information Administration (“EIA”), B&V Analysis
-250.00
-200.00
-150.00
-100.00
-50.00
0.00
Reference Case High CO2-High Tech High CO2-2006 Tech Low CO2-High Tech Low CO2-2006 Tech
Mill
ion
CO
2 T
on
s
Increased Direct Use Of Natural Gas Increased Direct Use Of Natural Gas
Reduces Reduces COCO2 2 EmissionsEmissions
In all scenarios, projected decrease in CO2 emissions
From 60 million to 200 million tons
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Looking Forward
• Natural gas is the “bridge to the future”
• Demand is growing in all segments
• Supply access and infrastructure remain critical issues that must be addressed
• High and volatile prices are detrimental to consumers and the economy