california energy commission carbon management: a state energy r&d perspective terry surles...

CALIFORNIA ENERGY COMMISSION

Carbon Management: A State Energy R&D Perspective

Terry Surles

California Energy Commission

AAAS National Meeting Symposium on Carbon Management

San Francisco, California

February 17, 2001


Carbon Management: An Approach for Integrated Energy Systems Management

Carbon Management

Efficiency-operational- DSM- end use

Decarbonization- “clean energy” Sequestration


Why Worry about Energy?(Circa 12/98)

Petroleum selling at < $11/barrel Proven natural gas reserves at 175 Tcf

and $2/MBtu Abundant supply has depressed uranium

prices (< $80/kg U) There is a lot of cheap coal (~$26/ton) Lots of generating capacity and reserve

margin


We’re Concerned Now

Oil is at $30/barrel Natural gas price is at $18/Mbtu and demand

(at least temporarily) is depleting reserves Energy use impacts global commons (7.4

Gt C/yr. in 1997) Deregulation has changed playing field New regulations and international policies Regional reserve margins are problematic


California’s Concerns are Similar in Some Areas

Increased natural gas use Continuing need for improvements in

demand-side energy technologies Aging fleet of generators Financial constraints Climate change uncertainties NIMBY “Needle peaks”


California Context: Additional Factors

Demographics High-technology industrial sectors Social values Air quality Water availability and quality Seismic In-state R&D excellence


CA Energy Use by Sector (1996)

46%

31%

13%

13%


Production of Electricity by Source - 1996

Imports

Imports

NG-15.5%

Hydro- 32.6%

Coal- 51.9%

Wind/solar- 1.5%

Biomass/waste- 2.3%

Oil- 0.3%

Natural Gas

Hydro

17.9%

30.6%

18.9%

Nuclear

Coal

15.4%

8%

258,801 GWh 3,111,441 GWh

Coal55.8%

Nuclear21.7%

Hydro10.6%

Nat Gas8.4%

Wind/solar-0.0004%

Geothermal- 0.2%

Imports- 1.1%

Oil- 2.2%


Peak Demand is Increasing Faster than Newly Installed Capacity

Me g

a wa t

t s

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

1994 1995 1996 1997 1998 1999 2000

Peak Load Growth

Capacity Additions


Rising Peak Demand Threatens Reliability and Power Quality

*During “no touch” periods, the ISO demands that generators refrain from downtime for maintenance

Num

ber

of P

ower

Em

erge

ncie

s

in C

alif

orni

a


Market Uncertainty- Price Volatility Impacts Energy Delivery and Use

0

100

200

300

400

500

600

700

800

04/01/98 08/01/98 12/01/98 04/01/99 08/01/99 12/01/99 04/01/00 08/01/00

Mar

ket C

lear

ing

Pri

ce (

$/M

egaw

att-

hour

)


Contribution to ISO Peak DemandAugust 16, 2001 (MW)

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

43,509 MW

Commercial AC

Commercial Lighting

Residential AC

Other

MW

60005000

6000

26,509


2000/2001 Shocks Have Made Energy a Priority

AB 970 Expedited Siting for Simple Peaking Facilities and Facilities

that Pose No Significant Environmental Risk Implementation of $50 M Energy Efficiency Grant Program

AB 995 Extends Surcharge to Fund Public Purpose Efficiency,

Renewables, and R&D Programs for 10 years

SB 1298: ARB to Establish Standards for DG Technologies

SB 1345: Grants to Purchasers of Solar and DG Systems

SB 1771: Establishes Greenhouse Gas Emissions Inventory

New Legislation and Executive Orders


California has Established a $62M/yr Public Interest Energy Research Program

(PIER)

California’s Energy Future

Economy:Affordable Solutions

Quality:Reliable and

AvailableEnvironment:Protect and

Enhance


Funded Program Areas to Date (in millions)

Supply $26.4Renewables, EPAG

Demand $40.1Buildings, Ind/Ag/Water

$34.9Strategic, Environmental


Attributes for Addressing State Issues

Program Integration

Balanced Technology Portfolio-Temporal-Technology-Risk

TechnologyPartnerships- Universities- Industry- Federal

Focus onCalifornia- Specific to State needs


Our R&D Program must Address Future Market Scenario

Regulated

De-regulated

De-centralizedCentralized

Status Quo • New energy systems

• Same players

Supermarket of Choices

• Same energy systems

• New players


Given Our Limited Budget and California Characteristics, We’re Not

Going to... Build the next GCM or other large scale

models Work on Generation IV nuclear technologies Work on most Vision 21 coal technologies Duplicate other efforts well-funded by DOE,

EPRI and others Duplicate specific R&D already funded by

industry


We will Couple the California Context with Precepts of Carbon Management

End-use efficiency and demand-side technologies buildings and appliance technologies manufacturing, agriculture, water efficiency storage and conversion technologies

Clean technologies renewables and small-scale fossil generation and control technologies that enhance environment power conditioning new technologies with collateral benefits

Enabling technology improvement and development development of sensors, models, systems for real-time pricing models, sensors, monitoring systems to improve T&D system operation

and integration of DG science base and model improvements to evaluate impacts of energy

systems development of new integrated systems and economic models to

improve understanding of deregulated market structure


Carbon Management and California: An Appropriate Paradigm for

State R&D Program

Environment Economy Reliability

Couple state and external

issues Long-term solutionscouple to current events

Integration with external

R&D provides flexibility


Carbon Management: An Umbrella for Global, National, State and Local Issues

Global

- Climate Change

- Resource Competition

Nation

- Security

- Environment

- Economy

State

-Affordability

- Environment

- Reliability

Local

- End use

- NIMBY

california energy commission carbon management: a state energy r&d perspective terry surles...

Documents

carbon dioxide emissions

electricity generation16

production of electricity

electricity fuels

carbon managementsan

natural gas usecontinuing

fossil fuel consumption

iso peak demandaugust