ACHIEVING MAINE'S CLIMATE GOALS: ENVISIONING A ZERO CARBON ECONOMY PRESENTED BY PRESENTED TO Jurgen Weiss Placeholder Environmental & Energy Technology Council of Maine image JUNE 10, 2020 See Slide 2 Disclaimer brattle.com | 1
Disclaimer This presentation was prepared by The Brattle Group does not relationship between assumptions and outcomes. The Brattle represent investment advice, and there are no third party Group does not make, nor intends to make, nor should any beneficiaries. The Brattle Group does not accept any liability for other party in receipt of this report infer, any representation any losses suffered, whether direct or consequential, in respect with respect to the likelihood of any future outcome. The of the contents of this report or any actions taken or decisions analyses and market overview are valid only for the explicit made as a consequence thereof. purpose for which they were prepared and as of the date of this Placeholder report. Any decisions made in connection with this report or the subject matter hereof, or use of any information contained in The analyses presented herein are necessarily based on image this report, are the sole responsibility of the reader. assumptions with respect to conditions which may exist or events which may occur in the future. Please appreciate that actual future results may differ, perhaps materially, from those indicated. It is also important to acknowledge that the methodologies used to devise The Brattle Group’s analyses and market overview simplify and may not accurately reflect the brattle.com | 2 See Slide 2 Disclaimer brattle.com | 2
The presenter Jurg e n We iss is a Princ ipa l a t T he Bra ttle Gro up, a n inte rna tio na l Dr. e c o no mic c o nsulting firm. He is a n e ne rg y e c o no mist with 25 ye a rs o f c o nsulting e xpe rie nc e s. He spe c ia lize s in issue s b ro a dly mo tiva te d b y c lima te c ha ng e c o nc e rns, suc h a s re ne wa b le e ne rg y, e ne rg y e ffic ie nc y, e ne rg y sto ra g e , the inte ra c tio n b e twe e n e le c tric ity, g a s, a nd tra nspo rta tio n. He wo rks fo r e le c tric utilitie s, NGOs, a nd g o ve rnme nt e ntitie s Placeholder in No rth Ame ric a , E uro pe , a nd the Middle E a st. He also just ac c e pte d a S e nio rF ac ulty po sitio n at Harvard Busine ss S c ho o l. image Dr. We iss ho lds a Ph.D. in Busine ss E c o no mic s fro m Ha rva rd Unive rsity, a n Contact Info M.B.A. fro m Co lumb ia Unive rsity a nd a B.A. fro m the E uro pe a n Pa rtne rship 617.234.5739 o f Busine ss Sc ho o ls. Be fo re Bra ttle , he c o -fo unde d Wa te rma rk E c o no mic s, 617.792.9055 (m) wa s the he a d o f g lo b a l c o nsulting fo r Po int Ca rb o n, a dire c to r a t L E CG Jurgen.weiss@brattle.com a nd a n a sso c ia te a t Bo o z Alle n & Ha milto n. See Slide 2 Disclaimer brattle.com | 3
Overview This presentation is based on three projects Coalition or Community Solar Access: Reaching New England’s 2050 • decarbonization targets Placeholder RI Division of Public Utilities and Carriers: Heating Sector Transformation for RI • image NYISO: New York’s Evolution to a Zero Emission Power System • See Slide 2 Disclaimer brattle.com | 4
Our 2019 report about New England asked whether NE is adding enough clean energy to achieve 80% by 2050 GHG reductions targets Historic a l a nd Pla nne d Annua l Re ne wa ble Proc ure me nts in Ne w E ng la nd Commitments to adding clean energy resources in Unspecified/ New England have Other Placeholder accelerated substantially 2019 ‐ 2030 Avg. Hydro 830 MW/year Solar over the past decade and image 2010 ‐ 2018 Avg. Onshore are expected to increase. 300 MW/year Wind Offshore • About 300 MW p.a. in Wind last decade Sources and notes: ABB, Velocity Suite and Brattle analysis of state renewable procurement programs. Historical solar capacity includes only installations over 1 MW. Planned solar procurements include MA 83A resources, SMART program resources, and CT Public Act 17 ‐ 3 resources. • About 800 MW p.a. in coming decade How much do clean energy resource additions in New England have to accelerate to achieve 2050 goals? brattle.com | 5 See Slide 2 Disclaimer
Electricity demand in New England will likely roughly double by 2050 across plausible scenarios 2050 Ne w E ng la nd Annua l E le c tric ity De ma nd (T Wh) E le c trific a tion a nd Sc e na rio: E ffic ie nc y F oc use d E le c trific a tion F oc use d Re ne wa ble F ue ls 2050 De mand: 214 T Wh 246 T Wh 286 T Wh Re lative to 2018 de mand: +77% +103% +136% Placeholder +40 TWh Electricity Savings Indirect from Res & Com EE Transport image Electrification* via Renewable Res & Com Fuels ‐ 32 TWh Transport Direct Electrification Res & Com Industrial Base Commercial Residential Driven by almost complete electrification of road transport, dominant electrification of buildings (directly or indirectly), and partially offset by continued emphasis on energy efficiency Source: EIA 2019 AEO, Brattle analysis brattle.com | 6 See Slide 2 Disclaimer
2x demand, lower capacity factors by RE and curtailment mean a total capacity need of >200 GW (6x today)!! Monthly Ge ne ra tion by Re sourc e One possible Ne w E ng la nd Re sourc e Mix TWh Sc e na rio : Ba la nc e d Po rtfo lio TWh Load Installed Capacity Annual Generation (Electrification Focused) Total = 219 GW Total = 382 TWh 13 TWh; 3% Storage 10 TWh; 3% Gas 35 TWh Solar 9% Onshore Wind Gas Solar 140 TWh Placeholder Offshore 37% Nuclear Wind Offshore 170 TWh image Hydro Wind 44% Nuclear Hydro 14 TWh 4% Re sourc e T ype s Se rving L oa d TWh Onshore Wind TWh – 107 GW of solar accounts for about 50% of capacity and 37% of Load generation Curtailments – 47 GW of wind, primarily offshore, provides nearly 50% of generation (27% of RE gen) Gas – 28 MW of storage primarily needed to shift excess solar generation to Storage peak load hours Clean Energy – 27% of renewable generation is curtailed due to periods of over ‐ generation and limited storage capacity – Gas capacity could be fueled with RNG to create Zero emissions Note: Load includes T&D losses. Curtailments include battery losses. brattle.com | 7 See Slide 2 Disclaimer
This implies New England needs to increase speed of annual clean energy deployment 4 ‐ 8 times on average Cumula tive Cle a n E ne rg y Re sourc e s in Ne w E ng la nd The current pace Required for 80% GHG Reductions 5,100 MW/year (Balanced Portfolio) of adding wind, 2019–2050 solar etc. falls far Hydro Historical Currently Planned short of what is Annual 280 MW/year 830 MW/year Offshore Placeholder Additions Wind needed to build 2010 ‐ 2018 2019 ‐ 2030 Onshore the needed image Wind renewable Cumulative Resources portfolio of 200 Solar GW by 2050, but a Large ‐ Scale Resources: 3,500 MW/yr steady growth rate Balanced Portfolio: 5,100 MW/yr of 10% or less per Local Solar & Storage: 6,600 MW/yr year would do it! The annual growth rates needed are lower than historic growth rates for all the key technologies needed – if we keep the foot on the accelerator, we can do it! brattle.com | 8 See Slide 2 Disclaimer
Broad building decarbonization via ASHPs will likely require mitigating peak impacts on the electric grid Ele Electric icity ity Pr Price by by Sce Scenario Placeholder image Electrification+decarbonization likely have moderate impacts on retail rates (except ASHPs) RE costs are coming down, increased cost offset by increasing demand (higher use of networks) If unmitigated, ASHPs could add another 5 cents/kWh See Slide 2 Disclaimer brattle.com | 9
The value of RNG both to decarbonize buildings and to the power sector depends on commodity and network costs Placeholder image Large uncertainty about how cheap/expensive producing significant volumes of RNG will be in the long run Impact of pipeline fixed cost on rates is significant ‐ volume losses could lead to higher rates (per therm) Some volume reduction is likely due to EE, partial electrification, and warmer winters See Slide 2 Disclaimer brattle.com | 10
We found that for building decarbonization there is no one technology that is clearly cheaper or better than the others Bookend Scenario Mixed versus Bookend Scenarios Placeholder image Cost is likely to increase for current natural gas customers; cost could remain similar for oil, propane customers. RNG becomes more costly and ASHPs less costly in “mixed” scenario – higher gas delivery cost; lower electricity cost See Slide 2 Disclaimer brattle.com | 11
Modeling a clean NY electricity system by 2040 including RNG (production and consumption) shows potential benefits Generation and Load, GW System load Wind Curtailed System load minus RNG production load Solar Curtailed Flexible Load Storage Pumped Storage RNG (Striped) Distributed Solar Solar Onshore Wind Placeholder Offshore Wind Interties Hydro image Nuclear Jan Feb Mar Apr ‐ May Jun Jul Aug Sep ‐ Oct Nov ‐ Dec Upstate/Downstate Transmission Flows, GW Southbound flows Northbound flows Flows from A ‐ E to neighboring zones RNG Production and Consumption, GW RNG consumption RNG production brattle.com | 12 See Slide 2 Disclaimer
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