The electric power industry can achieve deep reductions in greenhouse gas emissions by 2050 by building new nuclear plants, sequestering coal-plant emissions, boosting wind energy and improving efficiency, the industry's top research group said yesterday.
The Electric Power Research Institute's report on decarbonizing electricity generation said an "aggressive" push on new technologies could lower 2005-level carbon dioxide emissions from power plants by 41 percent in 2030.
EPRI's conclusions about energy technology gains were fed into a second computer model to assess the costs of stripping 80 percent of 1990-level carbon emissions out of the electricity sector by 2050, approximating the goal of the House-passed climate bill.
With what EPRI calls a "full" portfolio of technology options, including new nuclear, expanded wind power and carbon capture, the price of electricity in current dollars would climb by 80 percent in 2050. With a "limited" range of generation options, excluding carbon capture and new nuclear, the price soars 210 percent higher than now, EPRI reported.
"Our analysis clearly shows the imperative for the electricity sector to move aggressively to deploy a full portfolio of technologies that will lead to low-carbon energy future while limiting costs to the nation's economy," EPRI president Steve Specker said in presenting the findings yesterday to a meeting of industry executives and regulators in Westlake Village, Calif.
Based on its research, EPRI concludes that capture and sequestration of carbon emissions from coal plants would be technically feasible by 2020, and it assumes that new regulations would be in place to support that strategy. It also assumes that 45 new nuclear power plants could be built by 2030, using existing reactor sites, adding 64 gigawatts of new capacity.
"Each of these assumptions is based on the question, can we do that, from a science and engineering standpoint?" said the report's co-author, Revis James, director of EPRI's Energy Technology Assessment Center. "It might be expensive. It might be fraught with policy challenges, but is it feasible to do it technically? The spirit of this, to be candid, is to suspend reality for a moment with respect to the policy challenge and the financial challenge and first just assess the technical potential. Then you can overlay the financial and policy concerns on top of that."
James added, "The real question is how fast we can build nuclear plants, not whether we can build them, and when the sequestration technology is going to be available."
Conservative assumptions on wind, conservation
Although EPRI's technology judgments are based on its extensive research capabilities, its assumptions about the future for energy conservation and wind power are more restricted than advocates of conservation and renewable power say are possible. In a politically charged policy environment where energy forecasts vary hugely, the new EPRI study is unlikely to be the Rosetta stone that unites the debate.
EPRI's technology assessment, called its PRISM analysis, assumes that energy-efficiency strategies will reduce expected power consumption by 8 percent by 2030. A study by McKinsey and Co. last year concluded that a quarter of the carbon reduction required to stabilize global greenhouse gas emissions could come from energy efficiency and conservation.
The EPRI study assumes that renewable power would grow to 135 gigawatts by 2030, supplying 15 percent of generation. That target is consistent with leading congressional goals but is less than a target of 20 percent renewable generation by 2030, which the Energy Department has said is achievable. EPRI's target also assumes that 40 percent of new vehicles sold in 2025 would be plug-in hybrids.
"I don't think there's necessarily a technical reason why you couldn't build even more renewables. We decided to peg renewable at that point [15 percent]," James said.
"These are aggressive targets. A lot of things have to happen with the financial investments and in the policy environment. But at least it is technically feasible to go there."
The second step of EPRI's new analysis inserts the technology conclusions of the PRISM model into a computer model of the U.S. economy called MERGE to determine how much different carbon reduction strategies would cost. In the MERGE model's calculations, the 80 percent reduction in climate emissions by 2050 is fixed as a requirement. The model seeks the most efficient mix of generation in future years that can meet that requirement.
"The CO2 reductions targets can be met, " EPRI's study says. "The challenge is affordability."
The full portfolio scenario holds electricity costs to 80 percent over current levels by 2050, and this figure could conceivably drop close to today's costs through a series of energy research breakthroughs, Specker says.
In its limited portfolio assessment, EPRI does not add significant new nuclear power, and wind power grows but remains at 15 percent of generation. Deep reductions in electricity consumption are required, as well.
By 2020, conventional coal plants must be phased out because of carbon cap restrictions, and in their place, natural gas generation soars, providing half of all electric power. In this scenario, energy prices rise by 210 percent over current costs.
EPRI assumes an escalating price for natural gas -- even with new deliveries from shale gas and other unconventional sources, James said. To achieve the 80 percent carbon reduction goal, carbon prices -- and thus electricity prices -- will have to climb, he added.
"The reduction in demand that has to occur has to be driven by price signals -- a much higher cost for electricity," James said. Under the limited scenario, "the difference in demand growth is substantial, profound."
Without nuclear power and coal-emissions sequestration, demand reduction will have to climb to 2 trillion kilowatt-hours in 2050, James said. That is half of total electricity consumption today, he said. "This would be a radically different world to live in."
EPRI assumes an "overnight" construction cost of $5,500 per kilowatt and a levelized wholesale cost of power from new nuclear plants of $74 per megawatt-hour.
Critics and skeptics of nuclear power's future argue that new plants will cost considerably more. A 2008 Lazard study estimates the levelized cost of new nuclear power at between $107 and $138 per megawatt-hour.
"Probably the combination of nuclear and coal will be very important for a long time," James said, a conclusion that is likely to fuel more debate.