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MARKAL PRESENTATION. P.R. Shukla. MARK et AL location Model. Multi-period linear programming formulation Decision variables like, Investment in technology capacities & their utilization Energy consumption Emissions Electricity generation in different time periods.
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MARKAL PRESENTATION P.R. Shukla
MARKet ALlocation Model • Multi-period linear programming formulation • Decision variables like, • Investment in technology capacities & their utilization • Energy consumption • Emissions • Electricity generation in different time periods
MARKAL Overall Functioning Techno-economic Database Economic Scenario Emission Scenario MARKAL • Consumption and production of energy • Marginal ‘values’ of energy forms and emissions • Introduction and abandonment of technologies
Model Formulation Objective Function To minimize the discounted sum, over 40 yrs, of investment, operating and maintenance cost of all technologies plus the cost of energy imports and carbon tax
Model Formulation (cntd.) Subject to • Demand Constraint (one for each end use demand) Cig(t) >= demandk(t) i DMD G GRD V k DM, t T • Where • DMD…end-use demand technology • GRD…set of grades technologies/energy sources • DM….class of all end use demands • T…..set of time periods • Cig(t)…capacity of technology i of grade G in period t
Model Formulation (cntd.) 1. Capacity transfer constraints (to account for technology vintage carry over time periods) 2.Energy carrier balance constraints (supply >= demand of fuel) 3.Cumulative reserve constraints (fuel extraction <= total reserves)
Model Formulation (cntd.) 4. Electricity balance constraints (day and night time modelling for electricity system) 5. Process technology capacity utilization constraints (process activity <= available capacity) 6. Electricity production capacity constraints (electricity generation <= available capacity)
Model Formulation (cntd.) 7. Electricity peaking constraints (extra capacity to meet peak demand) 8. Total emissions constraints (Carbon, SO2 etc)
Modelling Non-linearities Grades for: • Technologies • Energy Resources
TECHNOLOGY DEPLOYMENT A Probabilistic Approach ` Market Price Median Cost Technology 2 Pacific Northwest National Laboratory Battelle Memorial Institute
TECHNOLOGY COMPETITION A Probabilistic Approach ` Market Price Median Cost Technology 2 Median Cost Technology 3 Median Cost Technology 1
What are likely Future Energy Trends underBusiness-as-Usual (BAU) From 1995-2035 • Energy Grows 3 times • Commercial Energy 4 times • Coal remains mainstay • High Oil/Gas Imports • Traditional Biomass Stagnates
Sectoral Energy consumption (EJ) From 1995-2035 • Industry & Residential Grow 3.5 times • Commercial Grows 9 times • Agriculture Stagnates • Transport Grows 5 times
Sectoral Electricity consumption (TWh) From 1995-2035 • Industry share stagnates around 45% • Agriculture share declines from 28% to 10% • Commercial and Residential grow faster
Electricity Generation Capacity (GW) From 1995-2035 • Coal share declines from 63% to 45% • Gas share increases from 8% to 23% • Hydro stagnates around 20%
Electricity Generation (TWh) From 1995-2035 • Coal share declines from 74% to 61% • Gas share increases from 7% to 19% • Hydro stagnates around 16%
Carbon Emissions (MT) 730 212
Carbon Emissions 1995 2010 2035
2035 2020 2025 SO2 Kuznets Curve
Mitigation Scenario Analysis
Marginal Cost of Carbon Mitigation(1995-2035) 60 6 billion tons of mitigation below $25/ ton of carbon 50 40 30 Cost ($/Ton of Carbon) 20 10 0 1 2 3 4 5 6 7 Carbon abatement (billion ton)
Implications of Mitigation TargetsCoal to Gas Switch Coal Demand Gas Demand 20 12 10 16 8 12 Exajoules Exajoules 6 8 4 4 2 0 0 2035 1995 2005 2015 2025 1995 2005 2015 2025 2035 Reference 1 BT (5%) 2 BT (10%) 3 BT (15%) 4 BT (20%) 5 BT (25%)
Electricity Price under Mitigation Scenarios Average LRMC • Electricity Price Rises with Mitigation • In 2035, price can more than double 10 9 8 7 6 5 cents per kWh 4 3 2 1 0 1995 2005 2015 2025 2035 Reference 1 BT (5%) 2 BT (10%) 3 BT (15%) 4 BT (20%) 5 BT (25%)
Electricity Price under Mitigation Scenarios Peak Off-Peak 15 15 12 12 cents per kWh cents per kWh 9 9 6 6 3 3 0 0 1995 2005 2015 2025 2035 1995 2005 2015 2025 2035 Reference 1 BT (5%) 2 BT (10%) 3 BT (15%) 4 BT (20%) 5 BT (25%)
Implications of Mitigation TargetsRenewable Electricity Renewable Electricity Capacity Share of Renewable 30 120 25 100 20 80 Giga Watt Percentage 15 60 40 10 5 20 0 0 1995 2005 2015 2025 2035 1995 2005 2015 2025 2035 Reference 5 % Mitigation 15 % Mitigation 25 % Mitigation
Implications of Mitigation TargetsWind and Small Hydro Power Wind Small Hydro 20 10 16 8 12 6 Capacity (GW) Capacity (GW) 8 4 2 4 0 0 1995 2005 2015 2025 2035 1995 2005 2015 2025 2035 5 % Mitigation Reference 25 % Mitigation 15 % Mitigation
Implications of Mitigation TargetsSolar PV and Biomass Power Biomass Solar PV 18 60 16 50 14 12 40 10 Capacity (GW) 30 8 Capacity (GW) 6 20 4 10 2 0 0 1995 2005 2015 2025 2035 1995 2005 2015 2025 2035 Reference 5 % Mitigation 15 % Mitigation 25 % Mitigation
Consumption Trends(Million Tons) Coal Oil Products 1500 400 1200 300 900 200 600 100 300 0 0 1975 1985 1995 2005 2015 2025 2035 1975 1985 1995 2005 2015 2025 2035 High Growth Medium Growth Low Growth
Commercial Energy Demand and Intensity Commercial Energy Commercial Energy Intensity 1200 50 1000 40 800 Mtoe 30 600 toe / million Rs. 20 400 10 200 0 0 1975 1985 1995 2005 2015 2025 2035 1975 1985 1995 2005 2015 2025 2035 High Growth Low Growth Medium Growth Low efficiency
Commercial Energy Demand 50 • Economic Growth Drives Energy Demand • Gradual Efficiency Improvement • Limited Fuel Substitution 45 40 35 30 Exajoules 25 20 15 10 5 0 1995 2005 2015 2025 2035 High Growth 5.5% Medium Growth 5% Low Growth 4.5%
Coal and Oil Demand Coal Oil 1400 350 1200 300 1000 250 800 200 MillionTons Million Tons 150 600 100 400 50 200 0 0 1995 2005 2015 2025 2035 1995 2005 2015 2025 2035 High Growth Low Growth Medium Growth
Energy Intensity 0.8 • Energy Intensity improvement rate 1.5% 0.7 0.6 0.5 toe/thousand $ 0.4 0.3 0.2 0.1 0 1975 1985 1995 2005 2015 2025 2035 High Growth Medium Growth Low Growth Low efficiency
Carbon Emissions 1200 From 1995-2035 • Under BAU, Carbon Emissions rise 360% • Rise can be 470% for high growth case 1000 800 Million Tons 600 400 200 0 1995 2005 2015 2025 2035 High Growth Medium Growth Low Growth
Carbon Intensity 0.9 • Carbon Intensity Improvement rate 1.8 % 0.8 0.7 0.6 0.5 tons of carbon/ thousand $ 0.4 0.3 0.2 0.1 0.0 1975 1985 1995 2005 2015 2025 2035 High Growth Medium Growth Low Growth Low efficiency
Implications of Mitigation TargetsCoal to Gas Switch Coal Demand Gas Demand 20 12 10 16 8 12 Exajoules Exajoules 6 8 4 4 2 0 0 2035 1995 2005 2015 2025 1995 2005 2015 2025 2035 Reference 1 BT (5%) 2 BT (10%) 3 BT (15%) 4 BT (20%) 5 BT (25%)
How Carbon Mitigation affects Production Cost? ALUMINUM STEEL 250 350 300 200 250 150 Cost of Aluminum Production 200 Cost of Steel Production 100 150 50 100 50 0 2015 0 2035 2015 2035 1 BT (5%) 3 BT (15%) 5 BT (25%)