Renewables and natural gas the future in Texas
The future of the Texas electric market will likely include substantial amounts of renewable energy and gas-fired power, economists with The Brattle Group find in a new report prepared for the Texas Clean Energy Coalition.
With over 12,000 megawatts of installed capacity, Texas is the largest state producer of wind-powered electricity in the U.S., more than double the next two largest wind capacity states combined. At the same time, Texas is the leading U.S. producer of natural gas, and the state generates over 40 percent of its electricity from natural gas plants.
Add to that the prospects for solar energy from the abundant sun and Texas is in a position to produce cleaner, more affordable and reliable electricity than ever before while helping improve economic well-being for Texans.
This preliminary review by the Brattle economists found the relationship between natural gas and renewables had aspects that were both complementary and, in some cases, substitutive. The research team also found that over the next two decades the degree to which natural gas or renewables “crowd out” the other source, as opposed to develop together, was a function of future policies and market design features, technological developments, and the price of electric fuels and resources of all types.
“Exploring Natural Gas and Renewables in ERCOT, Part II: Future Generation Scenarios for Texas” provides a 20-year outlook for natural gas and renewable power in Texas. It is the first examination of its kind to be conducted and shared publicly in Texas.
In June, The Brattle Group produced a white paper for TCEC exploring qualitatively the short- and long-term interaction between natural gas and renewables in Texas’ energy future.
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TCEC Chairman Kip Averitt, a former state senator and chairman of the Senate Natural Resources Committee, said the report, funded by The Cynthia and George Mitchell Foundation (www.CGMF.org), uses state-of-the-art modeling in a series of scenarios – including a range of natural gas prices, a required reserve margin, and different wind and solar energy costs – to simulate the Electric Reliability Council of Texas (ERCOT) system through 2032.
“The objective of this report was to examine broad patterns of interaction between renewable resources and natural gas over the next two decades,” Averitt said. “The report illustrates the key drivers of gas and renewable development in ERCOT to better inform Texas policymakers and decision makers about the range of possible outcomes.”
In the new report, the Brattle team examines the future of gas and renewable power in Texas analytically through the simulation of several grid expansion scenarios.
Key findings related to the future of natural gas and renewable energy, include:
- Under the range of scenarios, natural gas and renewables both play substantial roles in ERCOT and provide all new generation needed to respond to growth in the state’s population. No new coal plants are built in any scenarios.
- Across the more likely scenarios, wind and solar grow from their current 10 percent generation share to levels between 25 and 43 percent. Natural gas-fired generation provides all of the remaining incremental generation, adding 12 to 25 gigwatts of new combined-cycle capacity – a 38 to 80 percent increase in the current installed base.
- The mix of new gas and renewables generation is sensitive to the price of natural gas and cost declines in wind and solar power. Changes in these three factors can cause significant shifts in the mix of future installations, leading to a wide range of plausible generation shares for wind, solar, and natural gas.
- Among gas-fired power plants, nearly all future additions are combined-cycle gas turbine (CCGT) plants rather than traditional gas turbines, due to the fact that CCGTs are more efficient and expected to be more flexible than other turbines.
- The study found that the ERCOT system could accommodate all levels of variable renewables likely to occur during this period with no reliability problems. However, accommodating higher levels of renewables required the model to use an additional ancillary service – known as the intraday commitment option – and to adjust the levels of current ancillary services.
- The analysis shows that federal production tax credit and ERCOT ratepayer funding of new transmission lines remain important drivers of wind development.
- A reserve margin has a very small overall effect on the generation mix or emissions in ERCOT through 2032. However, scenarios using higher gas prices and lower renewables costs reduce the growth of CO2, NOX, and SO2 substantially. A stringent federal carbon policy reduces 2032 CO2 by 66 percent versus 2012.
- Existing coal units in ERCOT remain profitable and are not retired unless a relatively stringent federal carbon policy is adopted. A federal carbon policy requiring 90 percent capture and storage of carbon, for example, would prompt the retirement of most ERCOT coal units.
- Under the strong federal carbon policy scenario, gas and renewable generation would together replace the energy formerly supplied by coal plants. In this case renewable energy could rise to become 43 percent of ERCOT generation by 2032.
The complete report is available at http://www.texascleanenergy.org/2013-research.php.
All but two UK regions failing on school energy efficiency
Most schools are still "treading water" on implementing energy efficient technology, according to new analysis of Government data from eLight.
Yorkshire & the Humber and the North East are the only regions where schools have collectively reduced how much they spend on energy per pupil, cutting expenditure by 4.4% and 0.9% respectively. Every other region of England increased its average energy expenditure per pupil, with schools in Inner London doing so by as much as 23.5%.
According to The Carbon Trust, energy bills in UK schools amount to £543 million per year, with 50% of a school’s total electricity cost being lighting. If every school in the UK implemented any type of energy efficient technology, over £100 million could be saved each year.
Harvey Sinclair, CEO of eEnergy, eLight’s parent company, said the figures demonstrate an uncomfortable truth for the education sector – namely that most schools are still treading water on the implementation of energy efficient technology. Energy efficiency could make a huge difference to meeting net zero ambitions, but most schools are still lagging behind.
“The solutions exist, but they are not being deployed fast enough," he said. "For example, we’ve made great progress in upgrading schools to energy-efficient LED lighting, but with 80% of schools yet to make the switch, there’s an enormous opportunity to make a collective reduction in carbon footprint and save a lot of money on energy bills. Our model means the entire project is financed, doesn’t require any upfront expenditure, and repayments are more than covered by the energy savings made."
He said while it has worked with over 300 schools, most are still far too slow to commit. "We are urging them to act with greater urgency because climate change won’t wait, and the need for action gets more pressing every year. The education sector has an important part to play in that and pupils around the country expect their schools to do so – there is still a huge job to be done."
North Yorkshire County Council is benefiting from the Public Sector Decarbonisation Scheme, which has so far awarded nearly £1bn for energy efficiency and heat decarbonisation projects around the country, and Craven schools has reportedly made a successful £2m bid (click here).
The Department for Education has issued 13 tips for reducing energy and water use in schools.