Abundant PotentialMark Ohrenschall
Con.Web, November 26, 2002
Northwest Could Meet Load Growth with
Cost-Effective Conservation, Renewables, Study Says
Expanded energy-saving initiatives and new renewable resources could meet Pacific Northwest electricity load growth cost-effectively over the next two decades, according to a new study conducted for the Northwest Energy Coalition.
The Tellus Institute study identified 6,283 average megawatts of potential demand-side reductions by 2020, including substantial amounts of combined heat and power applications. The study also assumed 3,924 aMW from new renewable sources, principally wind, to supply 20 percent of regional power by 2020.
Together, these power reductions and renewable resources would contribute more than 40 percent of projected Northwest electricity needs by 2020, Tellus reported. They could also reduce regional power plant carbon dioxide emissions 50 percent from current levels, and provide long-term financial benefits of several billion dollars.
"Cost-competitive efficiency and renewables are more abundant than commonly assumed, and far more than are being pursued," study co-author Michael Lazarus told the NWEC fall conference Nov. 15 in Portland. He said the numbers reflect "reasonable penetration rates" and are "economically, institutionally, programmatically" achievable. Tellus estimated a levelized avoided cost of about 3.6 cents per kilowatt-hour (in 2000 dollars) in determining efficiency/renewables measures.
NWEC believes the study offers an alternative to the predominant natural gas-fired power generation envisioned for the region. The coalition also believes these alternatives promise resource diversity, environmental benefits and stabilized electricity prices. "The Tellus study tells us we have a clean and affordable energy future out there," said NWEC director Sara Patton.
Lazarus said the study should serve as a benchmark for the Northwest Power Planning Council's upcoming regional power/conservation plan. The Council will look at the Tellus work in developing its draft plan scheduled for a mid-2003 release, said senior policy analyst Charlie Grist.
The Tellus study describes itself as the first regionwide efficiency/renewables assessment since the Council's 1998 power/conservation plan, which incorporated much of its data and analysis from earlier in the 1990s.
"Since then, the landscape of technologies, markets, and policy options has shifted, while growing concerns about electricity price volatility, energy security, and global climate change have increased the value of investments in efficiency and renewable resources," wrote Lazarus and co-authors David von Hippel and Stephen Bernow. The authors started with the Council's plan, which listed 1,535 aMW of potential cost-effective conservation (later upped to 2,300 aMW on higher avoided costs) and 2,700 aMW of renewables available at prices ranging from 2 cents/KWh to 6 cents/KWh. "We then incorporated key changes in market conditions as of 2001-2002, such as higher avoided costs, new efficiency standards, and more up-to-date costs for wind and other technologies," they wrote. Other information came from national and regional sources, including the Northwest Energy Efficiency Alliance, Regional Technical Forum, the latest wind maps and various efficiency/renewables experts.
"We did not do any sophisticated modeling exercise," Lazarus said. "We tried to basically sift through what knowledge exists out there ... We tried to take all these puzzle pieces and put them together."
With the assembled information, "We then undertook a 'bottom-up' measure-by-measure analysis, examining the costs, benefits and market potential of over 30 individual efficiency and combined heat and power (CHP) measures, and four principal renewable resources (wind, biomass, geothermal, and solar)," the Tellus authors wrote.
Tellus found 6,283 aMW of cost-effective demand-side reductions available regionwide by 2020 (2,768 aMW by 2010). A projected 3,542 aMW could be gained from efficiencies in the residential, commercial, industrial and "other" sectors, while combined heat/power applications in the commercial and industrial sectors could add another 2,346 aMW. Fuel switching from electricity to natural gas and solar water heating could contribute an additional 395 aMW.
The identified energy savings would create cumulative regional economic savings (net present value) of $2.7 billion by 2050, according to the study, and $5.5 billion if environmental externalities are included. Most of these benefits would accrue after 2020.
The cost of saved energy for all but one of the 31 analyzed sector-by-sector measures falls below 4 cents/KWh, and the rest generally comes in at less than 3 cents/KWh. Solar domestic hot water is the most expensive demand-side reduction measure, at 13.2 cents/KWh. CHP measures would cost in the range of 3-4 cents/KWh, the study reported.
Northwest industries have the most abundant conservation potential among customer sectors, according to Tellus. Motor measures could provide about 43 percent of the 1,335 aMW industrial total by 2020, while other end-use savings could amount to 39 percent and aluminum processing efficiencies could yield another 16 percent.
Residential energy savings listed in the Tellus study amount to 1,223 aMW by 2020. About one-third of that, 456 aMW, could come from somewhat expensive water-heating efficiencies. Standby loss reductions in home electronics could save 218 aMW. Assorted space heating, building envelope and lighting measures also show notable energy-saving potential.
In the commercial sector, emerging lighting technologies and high-efficiency fluorescent lamps and ballasts could save 568 aMW of the 945 aMW Tellus-identified potential. Heating, cooling and ventilation efficiencies comprise just 10 percent of that total, although the study acknowledged that, "Further investigation of the commercial HVAC and building shell opportunities ... could reveal far greater cost-effective savings."
Beyond end-use efficiencies, the Tellus study is bullish on the opportunities for combined heat and power to reduce Northwest electricity demand. Natural gas-fired CHP systems such as internal combustion engines, combustion turbines and micro-turbines could total 2,346 aMW by 2020. CHP advantages include increased overall fuel efficiency, flexibility and established use in many regional industries, according to the study.
The Tellus study examined prospective wind, biomass and geothermal resources, "which are likely to be the most abundant, cost-competitive resources for large-scale grid applications in the region during the timeframe of this analysis." Solar photovoltaics, small wind, fuel cells and other distributed renewable technologies were excluded from the study.
Wind, biomass and geothermal resources theoretically could furnish 35 percent of regional power demand by 2020, according to the study. Tellus projected a 20 percent share by that date (of the envisioned reduced demand) and came up with 2,512 aMW of new wind, 1,221 aMW of new biomass and 191 aMW of new geothermal. Existing non-hydro renewables in the region now total 218 aMW, the study said.
Regional wind potential amounts to 6,433 aMW, Tellus reported. About 40 percent could be generated in Montana, with almost all the rest in Washington and Oregon. Lazarus and his colleagues limited their assessment to 25 percent of Class 4 through 7 wind resource sites, a total land area equalling 0.4 percent of the region, of which roughly 5 percent would actually be occupied by wind infrastructure. They excluded locations above 6,000 feet in elevation and those more than 20 miles distant from transmission lines.
This entire cumulative wind potential would cost less than 5 cents/KWh, accounting for the federal wind energy production tax credit.
Biomass opportunities in the near future center on co-firing in existing power plants and landfill gas, according to the study. Over time, biomass gasification combined cycle technology "could greatly expand the level of economically viable biomass energy use in the Northwest." Tellus identifies 2,880 aMW of longer-term regional biomass potential, at costs of up to 6 cents/KWh.
Geothermal energy is somewhat expensive and also more difficult to develop because of siting issues, Tellus reported. Nevertheless the study showed total potential of 641 aMW at costs ranging from 5 cents/KWh to 7 cents/KWh.
"Clean Electricity Options for the Pacific Northwest:
An Assessment of Efficiency and Renewable Potentials Through the Year 2020"
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