Electric utilities and government agencies are moving towards 100% carbon-free energy. Despite the enthusiasm behind this goal there are a considerable number of open questions. For example, what is the cost of a “carbon-free” system versus a “carbon-neutral system”? And what are these costs relative to? This presentation addresses these questions by determining the costs and carbon reduction trajectories associated with 100% targets.

This research employs a 20-year resource planning approach to a representative utility currently at a moderate renewable penetration and planning to have a carbon intensity of 0 g/kWh at the end of the 20-year horizon (100% carbon-free). The goal of the approach is to determine the investments associated with traveling the path to 100% assuming carbon-free versus carbon-neutral, and how these vary from a cost-optimal system.

Results show that a utility can achieve 80% carbon reduction based purely on economics, with no subsidies, mandates or renewable requirements. Moving to a purely carbon-free power system will cost 30-35% more (over 20 years), in large part due to massive investments in renewable energy and traditional energy storage systems. Once the 100% carbon-free state is achieved, all-in energy costs (\$/MWh) are almost double that of the 80% system. In contrast, a carbon-neutral system with power-to-gas is found to be the least expensive option, while achieving net-zero carbon emissions. These results indicate that utilities leveraging power-to-gas technologies can: meet net-zero carbon emission goals suggested by the Intergovernmental Panel on Climate Change (IPCC); maintain reliability and energy security; install flexible thermal capacity to support renewables, free from stranded asset concerns; and minimize costs to ratepayers.

Exciting new paradigms are emerging that lead electric utilities to explore pathways towards 100% decarbonization. This presentation demonstrates that utilities moving towards 100% carbon-free over multi-decade planning horizons will see flexible capacity and peaking assets as part of the cost-optimal new-build capacity mix as the system moves from low to high renewable penetration.


Pathways Towards 100% Carbon Reduction for Electric Utility Power Systems

Division / Sponsor:
Advanced Energy Systems Division (AESD) & Solar Energy Division (SED)

Paper Proceedings: https://asmedigitalcollection.asme.org/ES/ES2020/volume/83631

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