Joint carbon reduction from utilities and transportation

An alternative to the "utilities first" carbon reduction strategy just outlined is to undertake emission reductions from utilities and transportation sectors in tandem. Figure 6.6 shows model scenario results in addition to those in previous cases in which transportation and utility reductions are undertaken together. In the figure sets of points with the same fossil and nuclear capacity (100 GW nuclear in all cases) are shown together as a line. Points on the line indicate the cost and emissions with various hydrogen transportation options (e.g., none, cars only, cars and trucks, or cars, trucks and aircraft). The first point in each line is the case of no hydrogen transportation. These all fall on the efficient frontier. Interestingly, once low levels of fossil generation are achieved, scenarios that include some hydrogen transportation also fall on the efficient frontier of lowest marginal cost, or very close to it. Overall emissions and costs between scenarios are within 5% over this range of carbon emissions.

650 600 550

450 400 350 300

0 100 200 300 400 500 600 700

Carbon emissions (mmTonnes/yr)

-900 GW gas

—"i— 500 GW gas

—A—

350 GW gas

—X— 250 GW gas

—e—

100 GW gas

—•— 0 GW gas

- Slope of $500/tonne C emissions reduction

Figure 6.6 Additional scenarios showing the impact of hydrogen fueled transportation to electricity and transportation emissions and costs along the efficient frontier.

Figure 6.6 Additional scenarios showing the impact of hydrogen fueled transportation to electricity and transportation emissions and costs along the efficient frontier.

This suggests displacing natural gas from the entire (250 million) light-duty vehicle fleet will have costs comparable to reducing natural gas from utility generation when achieving emissions levels below 350 mmtC/yr.

The comparable costs of utility and transportation carbon reductions in this regime are principally driven by the projected higher efficiency of gas-fired combined cycle plants relative to peak power hydrogen fuel cells. Renewable hydrogen in utility energy storage can reduce more emissions by fueling light-duty vehicles than powering fuel cells. From the perspective of efficiently using natural gas, natural gas is more efficient than hydrogen at providing grid electricity while only equally efficient as a transportation fuel. In addition to improving carbon reduction efficiency, the flexibility of combined hydrogen storage and vehicle refueling can improve overall system capital and energy efficiency through higher capacity factors for renewable sources and fossil fuel capacity.

There is substantial value in maintaining approximately 20% of capacity as dispatchable technologies - costs begin to rise steeply as the last 100 GW of gas-fired capacity is eliminated from the utility system (Figure 6.6), especially in cases with hydrogen transportation. Retaining about 20% dispatchable

The transpo

jrtation served by H2 is indicated as: rmal symbol, no letter ;: half sized symbol, no letter s: letter "c"

a

None: no 50% cars 100% ca

NA

N

100% cars and trucks: letter "t" 100% cars, trucks, aircraft: letter "a"

\\

c\

t

c

*—in

0 100 200 300 400 500 600 700

Carbon emissions (mmTonnes/yr)

Table 6.1 Break-even capital costs (at 5% discount rate) for notional 100% efficient flywheel storage in selected scenarios from Figure 6.6

System

Transportation demand served

None

None

None

Cars, truck

description

Fossil capacity (TW)

0.5

0.1

0.0

0.0

Nuclear capacity (TW)

0.10

0.10

0.10

0.10

Flywheel capacity (TWh)

10

5

5

5

Analysis

System cost w/o fly wheel ($B/yr)

326.7

367.7

391.1

536.3

results

System cost with flywheel (excluding cost of flywheel itself) ($B/yr)

309.7

341.7

361.9

455.8

Annual cost savings ($B/yr)

17.1

26.0

29.2

80.5

Annual cost savings per kWh storage

1.71

5.19

5.84

16.09

Equivalent capital cost of savings,

21.3

64.7

72.8

200.6

($/kWh)

capacity minimizes the need for energy intensive storage. Strategically, this permits a broader array of complementary emission reduction technologies to be implemented earlier rather than later. Sequestration of modest gas-fired (potentially biomass) generation, in concert with transportation emission reductions from hydrogen fuel, can result in emissions levels (182mmtC/yr) well below those achievable by renewable utilities alone, and probably at lower overall costs than a strictly non-fossil approach to utilities and transportation.

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