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20% Wind Energy by 2030:Costs, Benefits and Transmission

20% Wind Energy by 2030:Costs, Benefits and Transmission

Ed DeMeoEd DeMeo

Renewable Energy Renewable Energy Consulting Consulting Services, Inc., Inc.

Ed DeMeoEd DeMeo

Renewable Energy Renewable Energy Consulting Consulting Services, Inc., Inc.

Transmission Policy InstituteNCSL – NWCC

June 17-18, 2010Denver, Colorado

Transmission Policy InstituteNCSL – NWCC

June 17-18, 2010Denver, Colorado

20% Wind Coordinator for 20% Wind Coordinator for USDOE, and CoUSDOE, and Co--Chair of 20% Chair of 20%

Wind Advisory GroupWind Advisory Group

20% Wind Coordinator for 20% Wind Coordinator for USDOE, and CoUSDOE, and Co--Chair of 20% Chair of 20%

Wind Advisory GroupWind Advisory Group

650 327 3090650 327 3090edemeo@earthlink.netedemeo@earthlink.net

Presentation Overview

Background

20% Wind Scenario

Costs

Benefits

Key Challenge

The 20% by 2030 Assessment

Explores one scenario for reaching 20% wind energy by 2030• Compares it to a no-new-wind scenario

Is a feasibility analysis -- not a prediction

Assumes no specific policy support for wind

Is the work of more than 100 individuals involved from 2006 - 2008 (government, industry, utilities, NGOs)

The 20% Wind Energy Scenario

Primary Assumptions:• U.S. electricity consumption grows 39% from

2005 to 2030 -- to 5.8 billion MWh (Source: EIA)

• Wind turbine energy production increasesWind turbine energy production increases about 15% by 2030

• Wind turbine costs decrease about 10% by 2030

• No major breakthroughs in wind technology

The 20% Wind Energy Scenario

Primary Findings:• 20% wind electricity would require about 300

GW (300,000 MW) of wind generation

• Affordable, accessible, abundant wind resources available across the nation

• Modest integration cost with operational cooperation over large regions

• Substantial net positive benefits

• Transmission a challenge

305 GW

20% Wind Scenario

2

46 States Have Wind Development by 2030 Under The 20% Wind Scenario

Costs, Benefits, and Impacts of the 20%

Wind Scenario

Costs, Benefits, and Impacts of the 20%

Wind Scenario

Economic Costs of 20% Wind Scenario

2% investmentdifference between

20% Wind and No New Wind

Incremental investment cost of 20% Wind Scenario

Electricity Sector Costs

No New Wind scenario costs over $2 trillion in new investment in net present value terms by 2030

20% Wind Scenario requires 2% more20% Wind Scenario requires 2% more investment ($43 billion in net present value)

50 cents per month on average household bill

20% Wind Scenario Impact on Generation Mix in 2030

Reduces electric utility natural gas consumption by 50% Reduces total natural gas consumption by 11%Natural gas consumer

U.S. electrical energy mix

Natural gas consumer benefits: $86-214 billion*

Reduces electric utility coal consumption by 18% Avoids construction of 80 GW of new coal power plants

Source *: Hand et al., 2008

2,500

3,000

3,500

4,000

4,500

he E

lect

ric S

ecto

ret

ric to

ns)

CO2 Emissions from the Electricity Sector

02006 2010 2014 2018 2022 2026 2030

500

1,000

1,500

2,000

2,500

No New Wind Scenario CO2 emissions 20% Wind Scenario CO2 emissionsUSCAP path to 80% below today’s levels by 2050

CO

2E

mis

sion

s in

t(m

illio

n m

3

Annual CO2 Emissions Reductions

CO2 emissions reductions by 2030= ~825 million metric tons annually

Could avoid~$98 billion* n C

O2

Em

issi

ons

tric

tons

)

500

600

700

800

900

Could avoid $98 billionCO2 regulation cost

Source *: Hand et al., 2008

Annu

al R

educ

tion

in(m

illio

n m

et

2008 2010 2012 2014 2016 2018 2020 2022 2024 20262028 20300

100

200

300

400

Annual Reductions

Wind Power Avoids Other Negative Impacts

Wind power avoids the negative impacts of fossil fuel-based electricity generation:• Air emissions of mercury

or other heavy metals • Emissions from

extracting and transporting fuels

• Lake and streambed acidification

• Mountaintop removal • Production of toxic solid

wastes, ash, or slurry

Wind Power Avoids Other Negative Impacts

NAS-NRC 2009 Study

• First authoritative US study of energy externalities

• Economic impacts of t d th illpremature deaths, illness,

reduced crop yields, etc.

• Coal result: 3.2¢/kWh

• Climate change impacts not included

Significant Water Use Savings

Cumulatively, the 20% Wind Scenario would avoid the consumption of 4 trillion gallons of water through 2030.

The 20% Wind Scenario cuts electric sector water consumption by 17%sector water consumption by 17% in 2030.

Jobs Supported by 20% Wind Scenario

Over 500,000 total jobs would be supported by the wind i d tindustry

180,000 jobs supported directlyin operations, construction, and manufacturing

Manufacturing Jobs Supported by State

4

Incremental direct cost to society$43 billion

50 cents/month/household

Reduction in emissions of greenhouse gasses and avoided carbon regulation costs

825 million tons of CO2

$50 to $145 billion

Summary: Costs& Benefits

Reduction in water consumption8% through 2030

17% in 2030

Jobs supported and other economic benefits

500,000 total with 180,000 direct jobs$2 billion* in local annual revenues

Reduction in nationwide natural gas use and likely savings for all gas consumers

11%$86-214 billion

Sources: DOE, 2008 and Hand et al., 2008 Note: All dollar values except * are in NPV

Key Challenge to Achieving the 20%

Wind Scenario:

Key Challenge to Achieving the 20%

Wind Scenario:

TransmissionTransmissionTransmissionTransmission

Need for New Transmission: Existing and New in 2030 Transmission

Enhancement of electrical transmission system required in all electricity-growth scenariosWind requires more transmission than some othertransmission than some other options as best winds are often in remote locations

Wind’s economic, energy-security and environmental benefits will not be realized

without transmission expansion!

For More Information on 20% Wind Energy:

Report Websites

Federal Government site:http://www1 eere energy gov/http://www1.eere.energy.gov/

windandhydro

Industry site:http://www.20percentwind.org

References

U.S. Department of Energy. 2008. 20% Wind Energy by 2030. DOE/GO-102008-2567. Washington, DC. AWEA. 2008. Wind Power Outlook 2008. Washington, DC.Black & Veatch. 2007. 20% Wind Energy Penetration in the United States: A Technical Analysis of the Energy Resource.Walnut Creek, CAHand et al. 2008. Power System Modeling of 20% Wind-Generated Electricity by 2030. National Renewable Energy Laboratory. Conference Paper NREL/CP-500-42794. Golden, CO. National Research Council. 2007. Environmental Impacts of Wind-Energy Projects. Washington DC: National Academies Press.Wiser, R. and M. Bolinger. 2007. Annual Report on U.S. Wind Power Installations, Cost, and Performance Trends: 2006.DOE/GO-102007-2433. Golden, CO: NREL.