the dutch chp/dh sector in the battle between economy, environment and security of supply in the...
TRANSCRIPT
The Dutch CHP/DH sector in the battle between Economy, Environment and Security of
Supply in the liberalized market
drs. ing. Teus van EckHelsinki, 17 june 2003,
EH&P Annual Conference
•Market situation•Economy•Environment•Security of supply•Regulation•Recommendations
Contents
Market situation
The actual situation
Traders
DGO’s
Consumers
Producers Grid Operators
Regulators
Government
CHP / DH
“Economy”
The long en short term values???
Environment
Security of supply
The Balance
Reality T.V. Low pricesHigh earningsLow risksMarket power
The future of our
children
EnvironmentPoliticians
Free market
Dream vs. Reality
•Dream: No coal, no nuclear and efficient gas CHP in the transition period to 100% sustainability.
•Reality: Growing demand, gas CHP nearly in bankruptcy and only 2% of total production is renewables.
•Prosperity-welfare?
Economy
Weekday Demand Curve Electricityin the Netherlands
0:00 5:00 10:00 15:00 20:00
100%
75
50
25
0
•Base Load
•Peak Load
Renewables
Fuel Costs for different Power Units
Fuel cost CCGT, Hot windbox CCGT, Conventional Gas, Conventional Coal Gas commodity 3,2 €/GJ, Coal 1,7 €/GJ
0,0
10,0
20,0
30,0
40,0
0 1000 2000 3000 4000 5000 6000 7000 8000 9000
Operation time [h]
Fu
el
co
st
[€/M
Wh
]
CONV GAS
HW CCGT
CCGT
CONV COAL
Consequences
•Gas CHP too expensive in night and weekend.
•Environment is not an item.•Bad investment climate for CHP.
Environment
Priorities?
•Only promoting Renewables vs. the lowest level of fossil fuel consumption and emissions for the total energy demand?
•Energy savings vs. the fossil fuel use/emission level per unit electricity/heat?
•Clear physical CHP electricity definition vs. lowest level of fossil fuel consumption
The environmental ranking
Quality
RenewablesGood gas CHPStegsBad gas CHPGood coal CHPModern coal unitsBad coal CHP
Ranking on base of operational results and
not on design efficiency
Heat Distribution
CHP
Back-up/peak
Sto
rag
e
Grid ConsumerAlternative Consumer
F
F
EE E E
H
FH
H
E= Electricity
F= Fuel
H= Heat
Energy savings for the total chain between +90% and –40%
Some figures
•100 km by car –15 kg CO2•1 Dutch family with DH saves 1500 kg CO2/yr
•1 Windmill of 1 MW saves 700 ton CO2/yr
•1 MWth CHP saves 700 ton CO2/yr
Security of supply
•Technical, availability fuels, the environment
•Separate electricity production results in 45-75% waste heat
•Political risks•Distributed vs. centralized generation
Regulation
CHP / DH
Regulator
DGO’s
ConsumerOrganisations
Convenants between government/market parties
National support
Local Governments
E.U. directive CO2 trading
Fuel markets
Traders/producers
E.U. directive CHP
Opportunities-Risks
•Opportunities: Energy/emissions savings, security of supply, proven technology
•Risks: Continuity of heat demand and or heat source, economy of scale, weak and uncertain position in electricity and fuel market, level playing field? no structural financial valuation of environmental aspects
Recommendation
Translate our smile in market power.Result: a structural, payable big smile.
CHP smile for the environment
Power of the market