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Planning for Growing Electric Generation Demands. Kansas Energy Council – Electric Subcommittee. March 12, 2008. Topics. The Power Supply Planning Process Conventional Power Supply Technologies Renewable Technologies Nuclear Developments Summary Questions and Answers.

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Planning for growing electric generation demands l.jpg

Planning for Growing Electric Generation Demands

Kansas Energy Council – Electric Subcommittee

March 12, 2008


Topics l.jpg
Topics

  • The Power Supply Planning Process

  • Conventional Power Supply Technologies

  • Renewable Technologies

  • Nuclear Developments

  • Summary

  • Questions and Answers

2


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New Generation Planning Process

  • In Parallel with a power market assessment and siting study. Usually also in parallel with DSM and existing generator life extension / retirement analysis

3




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Hourly Load Pattern Dictates Need for Various Generation Types

Peaking

Intermediate

Baseload

% Time

6


Power supply options l.jpg
Power Supply Options Types

Renewable

Purchased

Power

Conventional Generators

Demand Side Management

Nuclear

7


Comparative costs conventional generation resources sample l.jpg
Comparative Costs TypesConventional Generation ResourcesSample

Baseload

Intermediate

Peaking

150 MW CT

600 MW PC

500 MW CC

8


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Generation Resource Screening TypesRepresentative Sample

Assumes $6.80/MBtu gas in 2012 escalating at 4% per year and $1.45/MBtu coal escalating at 3% per year.

Solar and Wind technologies are not firm resources.

9


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Baseload Resource Screening with CO2 Costs TypesRepresentative Sample

Note: Assumes biomass is CO2 neutral per the Intergovernmental Panel on Climate Change (IPCC).

Assumes $6.80/MBtu gas in 2012 escalating at 4% per year and $1.45/MBtu coal escalating at 3% per year.

10


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Purchased Power or Power Sales Options TypesRequire Analysis of Available Transmission CapacitySample


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New Generators Should Complement the Existing Mix TypesSample

Load Duration Curve Screening-2011 Options

Of 425 MW of firm capacity needed by 2011, up to 350 MW of new solely-owned coal capacity can be added while keeping coal and combined cycle in a least cost mix. The remaining 75 MW added should be peakers.

12



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Comparative Rate Impacts TypesCompare Plans Using Detailed Production Cost and Financial Models

Sample

14



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Consider Corporate Financial Impacts-Adverse of Risk ScenariosImpacts on Bond Ratings Also Increase Revenue RequirementsSample

Coverage Ratio

Typical Target is 3 to 4.

16


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Selected Plan(s) Must Consider Lead Times of Risk Scenarios

Air Permit

Start

Start Permitting

Engineering and

and Preliminary

Begin

Receive Air

Procurement

Construction

Engineering

Permit

In Service

Studies and

Permitting

Detail Engineering

Construction

Conceptual

Preliminary

and Procurement

Engineering

Engineering

Cost Estimate

Schedule

17


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Power Supply Options of Risk Scenarios

Renewable

Purchased

Power

Conventional Generators

Nuclear

18


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Generation Technology Overview of Risk ScenariosConventional Generation

  • Simple Cycle Combustion Turbine (SCCT or CT)

  • Combined Cycle Combustion Turbine (CCCT)

  • Atmospheric Circulating Fluidized Bed (CFB)

  • Pulverized Coal (PC)

  • Integrated Gasification Combined Cycle (IGCC)

  • Nuclear

19


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Comparison of Conventional Technologies of Risk ScenariosSimple Cycle Combustion Turbines

  • Description:

    • Simple cycle combustion turbine generates power by compressing and heating ambient air and then expanding those hot gases through a turbine which turns an electric generator.

  • Advantages:

    • Low capital costs

    • Short design and installation schedules

    • Choice for peaking service with rapid startup and modularity for ease of maintenance

    • High reliability and mature technology

  • Disadvantages

    • Typically higher operations and maintenance costs than combined cycle units

    • Typically not used for baseload operation

    • Sizes typically less than 300 MW

    • High fuel costs

20


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Comparison of Conventional Technologies of Risk ScenariosCombined Cycle Combustion Turbines

  • Description:

    • Combined cycle combustion turbine generates power by compressing and heating ambient air and then expanding those hot gases through a turbine which turns an electric generator. In addition, heat from the hot gases of combustion are captured in a heat recovery steam generator (HRSG) producing steam which is passed through a steam turbine generator.

  • Advantages:

    • Low emissions

    • Higher efficiency than SCCT

  • Disadvantages:

    • Higher capital cost than SCCT

    • Volatile natural gas prices

    • Higher non-fuel O&M than coal units

    • High fuel costs

21


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Conventional Technologies of Risk ScenariosPulverized Coal

  • Description:

    • Pulverized coal is burned in a steam generator constructed of membrane waterwalls and tube bundles which absorb the radiant heat of combustion producing steam that is fed into a steam turbine generator.

  • Advantages:

    • Most mature coal burning technology

    • More experience than any other power generation technology

    • Very reliable and easy to operate and maintain

    • Can accommodate up to 1,300 MW, and economies of scale can result in low busbar costs

    • Low fuel cost

    • Future units (advanced supercritical) higher efficiency and lower GHG emissions

  • Disadvantages:

    • Less fuel flexibility than CFB units

    • More sensitive to fuel characteristics, slagging, and fouling

    • Siting and Permitting has become more difficult

22


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Comparison of Conventional Technologies of Risk ScenariosCirculating Fluidized Bed (CFB)

  • Description:

    • Combustion air is introduced through the bottom of the bed material normally consisting of fuel, limestone, and ash.

    • Heat generated from burning fuel produces steam which is fed into a steam turbine generator.

  • Advantages:

    • Ability to burn a wide variety of fuels – greater fuel diversity than PC

    • Very reliable and easy to operate and maintain

    • Slagging and fouling tendencies minimized because of low combustion temperatures

  • Disadvantages:

    • No units larger than 300 MW have been built

    • Slightly higher operations and maintenance cost than PC units

    • Less suited for numerous startups and cycling than PC units

    • Typically less efficient than PC plants

23


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Comparison of Conventional Technologies of Risk ScenariosIntegrated Gasification Combined Cycle

  • Description:

    • Fuel (petcoke, coal, or other solid fuel) converted to syngas then combusted in modified gas turbines in a combined cycle power generation unit.

  • Advantages:

    • Capability of operating at relatively low emissions compared to PC/CFB’s.

    • Efficiencies comparable to supercritical PC technologies

    • Costs associated with reducing Hg and capturing CO2 emissions generally thought to be incrementally lower for IGCC than for CFB and PC technologies

  • Disadvantages:

    • Capital costs, operating costs, and availability

    • Reliability lower than PC and CFB

    • Startup and shutdown flaring reduces emission benefits of IGCC over PC and CFB

    • To date, large-scale, U.S. based power producing IGCC plant not proven to be economically feasible without subsidization

24


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Comparison of Conventional Technologies of Risk ScenariosRepresentative Emissions Levels

25


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10 of Risk Scenarios

12

8

2

4

6

Comparison of Conventional TechnologiesRepresentative Development Schedules

Schedule and Costs Are Increasing

The schedules and costs of all technologies, including renewables, are being adversely impacted by the current scarcity of labor and materials.

SCCT

CCCT

PC

IGCC

Nuclear

Units 5+

Years

26


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Generation Technology Overview of Risk ScenariosRenewable Generation

  • Wind

  • Biomass

  • Landfill Gas

  • Solar

27


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Comparison of Renewable Technologies of Risk ScenariosWind

  • Description:

    • Convert movement of air to electric power by means of a rotating turbine and a generator

    • Fastest growing energy source (+30% annually forlast 5 years)

    • Project Sizes 1 to 300+ MW

    • Cut-in wind speed: 8 mph

    • WTG Specs: 1985 2007Rotor: 15m 90mHub Height: 20m 80mRating: 50kW 2,000kW

  • Advantages:

    • Clean generation technology

  • Disadvantages:

    • Wind is an intermittent resource and capacity factors range from 25 to 40 percent

    • High capital costs, maintenance costs on the order of $35/kW-yr

    • Capacity factor directly impacts economic performance

    • Cannot be relied upon as firm capacity for peak power demands

28


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Comparison of Renewable Technologies of Risk ScenariosDirect-fired Biomass

  • Description:

    • Similar in operation to coal plants. By burning biomass, pressurized steam is produced in boiler then expanded through a turbine. Biomass traditionally from direct combustion at pulp and paper mills, lumber mills, etc.

    • Prior to combustion in boiler, biomass fuel may require some processing to improve physical and chemical properties of feedstock. Stoker and fluidized bed combustion technologies are well proven.

    • 6,500 MW of capacity installed in the U.S.

  • Advantages:

    • Burn wide variety of fuels

    • Carbon-neutral power generation (per IPCC)

    • Biomass fuels contain little sulfur and trace amounts of toxic metals

  • Disadvantages:

    • Capacities range up to 85 MW, average 20 MW

    • Plant must be located at or within 50 to 75 miles from fuel source to be economically feasible

    • Lower heating values of fuels make biomass plants less efficient than coal plants

29


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Comparison of Renewable Technologies of Risk ScenariosBiomass Co-firing

  • Description:

    • Biomass and coal are co-fired in existing coal plants

    • Two basic approaches to co-firing:

      1. Blend fuels and feed together in coal processing equipment

      2. Separately processing and then injecting biomass in boiler

  • Advantages:

    • One of the most economical ways to burn biomass ($50–400/kW)

    • Using Method 1: in a cyclone boiler, up to 10 percent of the coal heat input could be replaced with biomass

    • Using Method 2: in a PC boiler, 10 to 15 percent of coal heat input could be replaced with biomass

  • Disadvantages:

    • Disperse nature of feedstock and high associated transportation costs as in Direct-fired Biomass and Biomass IGCC

    • Limited capacity by amount of resource available

    • Reduced plant capacity, boiler efficiency

    • Ash contamination, increased O&M cost, boiler fouling/slagging, SCR catalyst poisoning

30


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Comparison of Renewable Technologies of Risk ScenariosLandfill Gas (LFG)

  • Description:

    • LFG is produced by the decomposition of the organic portion of waste stored in landfills. LFG primarily consists of methane which can be burned in reciprocating engines or small gas turbines.

  • Advantages:

    • Burns gas that would otherwise be emitted into the atmosphere as GHG

    • Regarded as one of the more mature and successful waste-to-energy technologies

  • Disadvantages:

    • Power production from LFG typically less than 10 MW

    • Pretreatment of gas prior to combustion

31


Comparison of renewable technologies solar thermal technologies l.jpg

Parabolic Trough of Risk Scenarios

Parabolic Dish

Central Receiver

Compact Linear Fresnel Reflector

Comparison of Renewable Technologies Solar-Thermal Technologies

  • Description:

    • Solar thermal technologies convert the sun’s energy to electricity by capturing heat, producing steam and passes through a steam turbine.

    • Parabolic trough currently most prevalent technology.

  • Advantages:

    • Appropriate for a wide range of intermediate and peaking applications

    • Clean generation technology

    • Commercial solar thermal trough plants in California currently generate more than 350 MW

    • Thermal energy can be stored to allow for generation when sun is not shining

  • Disadvantages:

    • Large land to MW ratio

    • Dependant on sunlight availability

    • High capital cost

32


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Nuclear Reactor Technology of Risk Scenarios

  • Description:

    • Inside a nuclear reactor, uranium atoms are bombarded by neutrons

    • When a neutron is absorbed by a uranium atom, atom becomes unstable and splits, a process known as fission

    • Fission process generates heat in the reactor core and generated heat is transferred to water which is circulated to the steam generator

    • Electricity generated by applying steam to a turbine generator, much like coal-fired power plants

  • Advantages:

    • Virtually no emissions

    • Relatively low fuel cost

  • Disadvantages:

    • Obstacles related to public perception

    • Capital costs

    • Political risks

    • Environmental issues concerning disposal of spent fuel

33


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2005 Energy Policy Act Assists New Nuclear of Risk Scenarios

  • Production Tax Credits

    • 1.8¢ / kwh for 8 years up to $125 million annually per 1,000 MW

    • Requires COLA Submittal NLT 12/31/2008 & First Safety Concrete Pour NLT 1/1/2014

  • Loan Guarantees

  • Standby Support

    • 100% for first two units up to $500 million each

    • 50% for next four units up to $250 million each

  • Renewal of Price-Anderson Act

  • Continuation of Nuclear Power 2010 Program

  • Nuclear Decommissioning Tax Relief

34


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Nuclear Power 2010 Program of Risk Scenarios

  • Nuclear Power 2010 Program is a Joint Government-Industry Cost Sharing Program That Will Pay up to Half of The Nuclear Industry’s Costs for Development of Generation III+ Technologies

  • Current Program Participants Include:

    • NuStart Energy LLC: AP1000 (Bellefonte)

    • Dominion Energy: ESBWR (North Anna)

35


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Other Changes for New Nuclear Construction of Risk Scenarios

  • Regulatory Change to Single Step Licensing Process

    • Previous Generation Reactors Required Construction Permits and Operating License Hearings

    • New Generation III/III+ Reactors Obtaining SER As Generic Designs

    • Utility Submits COLA (Combined Operating License Application) for Site Specific Aspects of Project

    • Process Only Applies if Utility Uses Generic Designs- All Modifications Require USNRC Review

36


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Status of Nuclear Industry of Risk Scenarios

37


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Status of Nuclear Industry of Risk Scenarios

38


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Limits to Foreign Ownership of Nuclear Generating Plants of Risk Scenarios

Partial foreign ownership of a nuclear plant is not specifically prohibited by regulation - 100% foreign ownership is prohibited. The NRC reviews the makeup of the ownership as part of the license applications and makes a judgment regarding the ownership, considering whether the foreign component is just financial or the foreign component is acting as the licensee. A prior NRC ruling in the case of Amergen (PECO and British Energy) involved a 50-50 JV where PECO maintained the operating responsibility and BE was solely a financial vehicle. In this review, one of the main considerations by the NRC was the control of safety related activities (considered licensee activities) and that they be under the control of a US citizen. The NRC found it acceptable for the 50-50 ownership provided the day-to-day control of the plant and the licensee activities were under the control of the US entity. The same would hold true for Unistar, the EDF - Constellation JV.

Source: NRC SECY-98-252

39


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Summary / Conclusions of Risk Scenarios

  • Generation additions are capital intensive and capital requirements have been increasing dramatically for all technologies

  • Electric generation has long-lead time requirements

  • Planning must consider rate-payers, stock holders, and Wall Street requirements

  • Planning must allow for all these factors

    • Recognition of risk and development of contingency plans

    • Value flexibility

40


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Q&A of Risk Scenarios

Page - 41


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