Professional Documents
Culture Documents
March 2012
1.
2.
Natural Gas Resources, Supply & Transport Reserves: Conventional & Unconventional Gas Transport LNG Environmental Impact Power generation from gas with / without Carbon Capture & Storage (CCS) Efficient Partner for Wind (and other intermittent energy sources) Prospects for Developments of Further Technological Options
2
3.
4.
Highlight the value of natural gas to ensure its fullest economic and environmental contribution in low carbon energy systems
Cost estimates
Note: The cost estimates in this package have been based on reliable, verifiable data. However they may not concur with cost estimates in other publications. This may be due to a variety of factors and assumptions, e.g.: Prices of fossil fuels CO2 prices Location factors Size of plants Costs of steel EPC costs Discount factors Lifetime of plants All cost comparisons in this package should therefore be considered as indicative. While capital costs of different options may vary considerably in absolute terms, in relative terms there is very little variance
(For reasons of consistency all cost data used in this package have been taken from the June 2010, Mott MacDonald (MMD) report for the UK DECC)
4
Power Generation
Wind Solar
PEAK-LOAD SUPPLY
Hydro
Nuclear
Embryonic Expansion Maturity
MID-LOAD SUPPLY
Jan
Dec
Less CO2 emission rights needed than for oil or coal Suitable for meeting base-load and mid-load demand
Source: based on MMD, June 2010
10
5 4 3 2 1
Based on: 7000 hrs operation for gas and coal per year 2500 hrs for onshore wind per year 3600 hrs for offshore wind per year 7800 hrs for nuclear per year
Capital costs of options may vary considerably in absolute terms, but very little in relative terms
12
Based on: 4300 hrs operation for gas and coal per year
* Costs do not take account of effect of interruptibility on the plant efficiency Capital costs of options may vary considerably in absolute terms, but very little in relative terms Source: MMD, June 2010
13
Gas CCGT
Coal supercritical
Nuclear
CCGT
Coal
Nuclear
CHP: Combined Heat & Power. Also: "cogeneration Proven technology To reduce thermal waste from power production and use the heat. Higher efficiency than separate generation Saves energy and emissions Total efficiency ~80 %. Can take biogas
Source: Energy Delta Institute
16
Industry
17
Easy handling, lower installation and maintenance cost Good controllability of processes and high efficiency Direct heating or drying of products or materials Clean and environment-friendly Less CO2 emission rights needed (where applicable)
18
Steam drums for paper manufacturing Ceramic foam infrared heater (1150 oC)
19
20
Chemical Feedstock
21
Gas conversion industry uses gas as an efficient and valuable source for chemical conversion into other products which are sold worldwide
Ammonia converts: some 135 bcm/year for production of fertilizer, fibers, etc Methanol converts: 30 bcm/year
Chemical feedstock
Many high quality and high value applications
Commercial Sector
24
Offices, schools, hospitals, leisure centers and hotels Shops, restaurants, caf's, Small businesses, workshops, garages Easy handling once infrastructure is present Lower investment cost compared to other fuels High efficiency heating equipment available (incl. condensation)
25
26
Residential Sector
27
Residential
Efficient and environmentally friendly fuel for heating, hot water and cooking
Clean and easy handling once infrastructure is present Low installation cost vs. other fuels High efficiency heating equipment available High comfort factor Individual heating systems in apartment blocks
Micro CHP:
Commercial applications in various countries
Micro CHP:
Heat and power from one apparatus High efficiency system with generator Your own home power plant
29
Grid Power
Heating
Air Conditioning
Lighting
Shower
City Gas
TV
Bath
Buckup
Hot Water
Floor Heating
Transportation Sector
31
CNG : Compressed Natural Gas Gas stored in vehicle at high pressure (200 bar)
LNG : Liquefied Natural Gas Gas stored in liquefied form at atmospheric pressure (requires cryogenic tank and regasification equipment ) Best in heavy vehicles and ships Alternatives : Gasoline, diesel, LPG Position gas : Clean, low on emissions Feasibility depends on fiscal regime Best in vehicles with limited travel radius and many stop-starts
LNG is used in increasingly many places for road transport fleets: Buses, Dust Carts, Chilled Container Transporters it gives good engine performance and a vehicle range comparable with other fuels
LNG is suitable to fuel high-consumption transport where space for the LNG storage is readily available: e.g. trains and sea ferries LNG is less-suitable for small privately-owned vehicles because of more complex procedures and more expensive fuelling stations with special requirements regarding their location. Heavy vehicles do not lend themselves to be run on electric power.
33
Examples New VW Passat Estate TSI EcoFuel model powered with turbocharged CNG engine 1.4-liter TSI 110 kW (148 hp) emitting 119 124 g CO2 / 100 km With average consumption of 4.4 5.2 kg / 100 km and 21 kg reservoir possible range with one filling is around 450 km
36
38
Source: Gasunie Natural gas, part of an efficient sutainable energy future, The Dutch case, Feb 2010
39
40
Volume
The total long-term recoverable conventional gas resource base is more than 400 tcm, another 400 tcm is estimated for unconventionals: only 66 tcm has already been produced. - IEA-Golden Age of Gas 201141
Middle East
Global proven gas reserves have more than doubled since 1980, reaching 190 trillion cubic metres at the beginning of 2010
Source: IEA World Energy Outlook 2011
42
Occurs in tight sandstone Low porosity = Little pore space between the rock grains Low permeability = gas does not move easily through the rock
Source: Shell
Natural gas trapped between layers of shale Low porosity & ultra-low permeability Production via triggered fractures
Natural gas in coal (organic material converted to methane) Permeability low Production via natural fractures (cleats) in coal Recovery rates low
43
World gas resources by major region (tcm) significant unconventional prospects world-wide
Inventorization of unconventional gas is still at an early stage
Unconventional gas offers potential for more domestic production in many countries Particularly for countries like China and Poland this could help to reduce dependence on coal
46
Shale gas is so far only produced in North America. Its true potential is still a matter of uncertainty.
Environmental concerns revolve around ground water contamination resulting from hydraulic fracturing. Governments, together with industry, are addressing new regulation for shale extraction to protect public health and environment. Energy used for production and its CO2 emission is higher than for conventional gas (see next slides).
47
Incremental for shale gas: Flaring & venting Production All types of gas: Production, flaring, venting & transport
Combustion
Gas Transport
49
Energy Transportation
daily equivalents
(diesel)
For high volume energy transportation: 8 power transmission masts of 3 GW each are equal to 1 gas pipeline (48 inch)
Source: Gasunie
52
Gas transportation for electricity generation can be combined with gas for other consumers in other market segments, leading to substantial economic advantages.
* for very long distances (over 800 km) UHVDC lines can offer scale advantages up to 6-7 GW
0.2-0.4% per 100 km 2-4% per 100 km 0.2-0.4% per 100 km plus 1% one-off conversion loss
EXPLANATORY NOTES
Input parameters for calculation of indicative costs of gas vs electricity transmission
Discount factor: 10% Load factor of electricity/gas transport: 5500 Lifetime: 25 years Energy losses AC transmission: 3% per 100 km Energy losses DC transmission: 0,3% per 100 km + 1% loss during AC-DC-AC conversion Energy losses gastransport: 0,3% per 100 km. Capex gas pipeline 24 GW: 0,2 mln /MW per 100 km Investment costs of AC overhead transmission, AC underground cable and DC underground cable are based on Parsons Brinckerhoff "Electricity Transmission Costing Study (Jan 2012) for the case Lo (3 GW) for 75 km. Investment costs of DC overhead line based on ABB "The ABCs of HVDC Transmission Technology", Case 500kv Investment costs of large scale gas pipeline (24 GW) is based on the average of building costs of existing pipelines (BBL, Blue stream, Green stream, Europiple II, Franpipe, Langeled, North stream)
Source: Clingendael International Energy Programme (CIEP), 2012
57
58
The LNG industry has a total of around 1 660 bcm of LNG available for sale from existing production over the period 2009-2025
IEA WEO 2009
Flexible LNG makes the LNG industry very responsive to changing demands of the global market
60
62
Gas source
Source: Skaugen
63
LNG is transported by road truck in many countries Trucked LNG has many small-scale uses: Domestic and commercial piped gas supply from satellite re-gasification terminals located in places remote from pipelines Small industrial users (electric power, engine tests, glass, paper) Commercial users (trains, buses, ferries, institutions) Supply to peak-shaving plants Supply to pipeline network during repairs or maintenance
64
65
*
per
1$
* Delivered
Environmental Impact
(examples are focussed on power generation)
67
Metric Tons CO2 per MWH 1 Oil (0.80) 0,75 Coal (0.85)
* With CCS
Source: IGU based on CERA
GHG Emissions
68
40,000
Solar
10,000
Wind
10
Natural Gas
Emission of CO2
(in kg CO2/MWh) 1,200 (340%) 850 (230%) 350 (100%)
Lignite-fired power
Gas-fired CCGT
Coal Supercritical
-6
kg/MWh
0,11
Heating oil
6,1
Lignite*
306
Hard coal**
554
* Emissions based on use of briquettes and lignite from the Rhineland-area in Germany
** Emissions based on use of briquettes LUWB Landesanstalt fr Umwelt, Messungen und Naturschutz Baden-Wrttemberg; Average emission factors for small and medium combustion installations without exhaust gas after treatment. Status: 2006, BGW; Source: www.asue.de
72
The next decade is critical. If emissions do not peak by around 2020 and decline steadily thereafter, achieving the needed 50% reduction by 2050 will become much more costly. In fact, the opportunity may be lost completely. Attempting to regain a 50% reduction path at a later point in time would require much greater CO2 reductions, entailing much more drastic action on a shorter time scale and significantly higher costs than may be politically acceptable.
IEA, ETP 2010
Over 40% of global CO2 emissions comes from Power Generation Over 70% comes from coal-fired Generation
Karstad IGU
A near-term initiative to displace coal generation with additional generation from existing natural gas combined cycle capacity could result in reductions in power sector CO2 emissions on the order of 10%.
MIT, 2010, on the US market
73
74
CCS
EXPANATORY NOTES
CCS = Carbon Capture and Storage Process of carbon sequestration from fossil fuels, based on existing technology. CCS currently regarded as economic at CO2-emission tax levels well above 50 $/tonne. This section discusses only so-called post combustion carbonsequestration. For the analysis a distinction is made between the CO2 capture and transportation / storage of CO2. To date no commercial application of CCS exists, neither for coalnor for gas-fired generation
75
85
Gas-fired CCGT
35
Resulting in
78
Capital costs may vary considerably in absolute terms, but very little in relative terms
Source: MMD, June 2010
79
Capital costs may vary considerably in absolute terms, but very little in relative terms
Source: MMD, June 2010
80
81
DEMAND FOR ELECTRICITY CAN BE MET FROM A VARIETY OF SOURCES WHICH WILL CONTRIBUTE BASED ON A SO-CALLED MERIT ORDER: For installed power plants the order in which these sources called upon to meet the demand is based on variable cost of production, leading generally to the following ranking preferences. 1. Renewable energy Hydro
Wind Solar Biomass* 2. Nuclear power plants 3. Coal-fired power 4. Gas-fired power
* Not necessarily the lowest variable cost option but often favoured for its low CO2 contribution
82
When You Need Electricity You Cant Flick a Switch and Turn on the Sun and Wind
Variability creates complex grid balancing and supply security issues Gas-fired generation can play a key role in maintaining grid stability and supply security
83
Wind power is a growing part of the generation mix. It is attractive because it is renewable and does not emit CO2. However, the contribution of wind power can vary significantly.
solar onshore offshore
This overview deals with the consequences of extended absences of wind power (more than 4 hours) for which combined cycle gas-fired power generation is a suitable partner
Source: CIEP/ Poyry 2011 estimates
84
DEMAND
WIND SUPPLY
Installed wind power displaces fossil sources of power supply, but will it be gas or coal?
The main purpose of wind power is to reduce power supply from fossil fuel and thus reduce CO2 emission An effective CO2 reduction will be achieved if coal-based electricity is displaced by wind power However, in energy systems with both gas- and coal-based generation, more gasbased electricity is generally displaced than coal, as long as the variable costs of gasfired generation are higher than those of coal (see also example Spanish Market).
Once CO2 emissions are priced/taxed or other performance measures are introduced this order could be reversed
Source: Clingendael International Energy Programme (CIEP), 2012
86
In MWh
Other CO2-free back-up options are not generally available on a sufficient scale to complement a growing share of variable wind energy
Gas-fired generation is a flexible and reliable partner for wind at the lowest incremental CO2 emission (and at the lowest incremental costs)
Power supply is often expressed in running hours, as a fraction of total design capacity. In following examples onshore wind supply accounts for 2,500 hrs in any year. In the same examples average market demand is approx. 5,500 hrs. Residual demand, to be supplied from gas-fired capacity thus becomes 3,000 hrs.
The example illustrates that wind combined with gas reduces CO2 emission. Wind combined with coal back-up produces more CO2 than a gas plant on its own
Source: Clingendael International Energy Programme (CIEP) based on MMD
90
The combination of wind and gas or coal represents 2,500 hrs of onshore wind and 3,000 hrs of complementary supply from gas and coal
92
Fuel cells
Market readiness
Source: based on E.ON Ruhrgas
Innovation
Future technology
93
Green Gas
Source: Senternovem
94
Fuel cells
1.
Produce H2 using electricity from solar cells or other renewables or from natural gas in a reformer Fuel cell : 2 H2 + O2 2 H2O + electricity + heat
2.
95
No CO2 emissions (with likely exception for production of H2 from natural gas)
Fuel cells have stationary applications (buildings, plants, telecommunications) and transportation uses (cars, buses, trucks and machinery) Today still high cost per installed kW
96
Terminology (1)
AC bbl bcm BTU CBM CCGT CCS CHP CNG Coal supercritical CO2 DC EPC GHG LF LNG Flexible LNG Load duration curve
Alternating Current Barrel Billion (109) cubic meter British Thermal Unit Coal Bed Methane Combined Cycle Gas Turbine, the current efficient type of gas-fired power generation Carbon Capture and Storage Combined Heat & Power Compressed Natural Gas Most efficient process of coal fired power generation Carbon dioxide Direct Current Engineering, Procurement and Construction Green House Gas Load Factor Liquefied Natural Gas LNG supply potential, not committed to a single market under a long term contract A demand load curve but the demand data is ordered in descending order of magnitude, rather than chronologically
97
Terminology (2)
LPG MWh NOX OHT Peak shaving Natural Gas Resources Reserves, proven
Liquefied Petroleum Gas Mega Watt hour Nitrogen Oxide Overhead transmission Processes of dealing efficiently with peak demand of electricity or gas Generally a broad indication of the potential availability of gas reserves Volume of oil or gas that has been discovered and for which there is a 90% probability that it can be extracted profitably on the basis of prevailing assumptions about cost, geology, technology, marketability and future prices* Proven reserves plus volumes that are thought to exist in accumulations that have been discovered and have a 50% probability that they can be produced profitably* Sulphur Oxide Trillion (1012) cubic meter Tera Watt hour Ultra High Voltage Direct Current
98