Tennessee Valley Authority · NYSE:TVC
Tennessee Valley Authority — Technical Presentation (October 2009)
32 slides from Tennessee Valley Authority's technical presentation, Oct 22, 2009
Slide 1: Supply Resource Options External Stakeholder Review
Supply Resource Options External Stakeholder Review October 22, 2009
Slide 2: Discussion Topics
Discussion Topics Overview — Focus of Today’s Discussion — Supply Side Resources — Approach to Estimating Cost and Performance Technology Discussion — Supply Option Characteristics • Fossil • Nuclear • Renewable and Alternative • Storage — Comparison of Capital Costs — Screening Inputs Modelin
Slide 3: IRP Summary Process
Overview IRP Summary Process Focus for today Scenario (World) — A plausible future made up of Uncertainties and tomorrow one or more uncertainties GHG requirements: __% that may be written as a Total load: __,___ MW narrative hypothesis Change in load shape: __ MW Uncertainty— Issue or concern that
Slide 4: Meeting Demand
Overview Meeting Demand MW MW Projected Capacity Shortfall (Summer Peak) Capacity planning is typically about 60,000 60,000 seeking the least cost option to close the gap between projected Projected Firm Requirements firm requirements (load + reserves) 50,000 50,000 and existing firm supply consis
Slide 5: Identifying the Least Cost Solution
Overview Identifying the Least Cost Solution Capacity need filled with mix of resources that 35000 are least cost combination 30000 — Both capital and operating costs are 25000 considered (revenue requirements) — Capital cost modeled as cash flow 20000 — Operating costs based on unit 15000 charact
Slide 6: Daily Load Shapes – Understanding Resource Needs
Overview Daily Load Shapes – Understanding Resource Needs Total Available Capacity > Peak Load (reflects required reserve margin) Peaking Resources Represents surplus capacity (used for pumping or off- Intermediate Resources system sales) Base Load Resources Summer Day Load Shape 1 2 3 4 5 6 7 8 9 1
Slide 7: Supply-Side Resources (Cont’d)
Overview Supply-Side Resources (Cont’d) There are many technologies to consider – cost, application, and maturity vary widely. Geography and proximity to supply source are also major factors. Mature Emerging Developmental / Conceptual Coal: IGCC with Coal: Pulverized Nuclear: BWR, Nuclear: AP1000 CC
Slide 8: Approach to Estimating Cost and Performance
Overview Approach to Estimating Cost and Performance Cost Estimates Determine required plant size and number of units Estimate capital costs — Ensure costs are for a complete plant — Base costs on 2009 dollars, assuming overnight costs. Overnight costs: • Include engineering, procurement, constr
Slide 9: Approach to Estimating Cost and Performance (Cont’d)
Overview Approach to Estimating Cost and Performance (Cont’d) Cost Estimates (Cont’d) Consider the following when comparing capital cost data — Level of the estimate (e.g., conceptual, final, based on bids) — Specific plant design (e.g., level of redundancy, amount spent to lower heat rate) — Year
Slide 10: Approach to Estimating Cost and Performance (Cont’d)
Overview Approach to Estimating Cost and Performance (Cont’d) Performance Estimates Estimate performance characteristics, in addition to capital costs — Heat rate and power output (include long-term degradation) — Fixed and variable operations and maintenance (O&M) costs — Emission rates (assume b
Slide 11: Technology Discussion
Technology Discussion
Slide 12: Characteristics – Fossil
Technology Discussion Characteristics – Fossil Natural Gas – Combustion Turbine (CT) Plants Low initial capital cost Very low O&M cost Quick start and low start cost Easier to site Shorter construction schedule Very high operating cost (e.g., fuel, variable O&M, emission) Natural Gas – C
Slide 13: Characteristics – Fossil (Cont’d)
Technology Discussion Characteristics – Fossil (Cont’d) All Base Load Coal Plants (coal-fired) Circulating Fluidized Bed Combustion Low operating cost Flexibility on coal types Typically coal prices are low and not very volatile Smaller size than PC plants – higher cost per kW (regulatory ri
Slide 14: Characteristics – Nuclear
Technology Discussion Characteristics – Nuclear Provider of baseload generation Low operating costs — Average fuel price volatility very low (long term fuel purchases) Does not create emissions of CO2, NOx, or SO2 Long lead time for licensing and construction High initial capital costs N
Slide 15: Characteristics – Nuclear (Cont’d)
Technology Discussion Characteristics – Nuclear (Cont’d) MIT Study Update – Understanding the Estimates Different Estimates Largely Reflect Different Quotation Methods: Illustration 14
Slide 16: Characteristics – Nuclear (Cont’d)
Technology Discussion Characteristics – Nuclear (Cont’d) MIT Study – Basis For $ per kW Construction Estimate Comparison of Five Nuclear Build Proposals in the U.S. 15
Slide 17: Characteristics – Renewable and Alternative
Technology Discussion Characteristics – Renewable and Alternative Wind Mature technology, commercially available Does not require additional fuel source Offsets greenhouse gases Relatively simple design, short lead time for construction Intermittent generation – not dispatchable Best win
Slide 18: Characteristics – Renewable and Alternative (Cont’d)
Technology Discussion Characteristics – Renewable and Alternative (Cont’d) Landfill Gas Mature technology, commercially available Practical for a large range of landfill sizes Converts a waste material into useable energy Capture and productive use of methane – a potent greenhouse gas Unce
Slide 19: Characteristics – Renewable and Alternative (Cont’d)
Technology Discussion Characteristics – Renewable and Alternative (Cont’d) Concentrated Solar Parabolic trough technology mature, commercially available Other technology types emerging Direct, non-diffused solar resources limited to Southwest U.S. Intermittent generation High capital costs
Slide 20: Characteristics – Renewable and Alternative (Cont’d)
Technology Discussion Characteristics – Renewable and Alternative (Cont’d) Hydrokinetic Emerging technology, first licensed project was August 2009 Varying capacity factors (e.g., ~29-65%) Siting and permitting issues Potential environmental and navigation impacts High cost Grid integrat
Slide 21: Characteristics – Storage
Technology Discussion Characteristics – Storage Pumped Storage Extraordinary operational flexibility Very low O&M costs Almost instant start and low start cost Very high initial capital cost, especially for a low capacity factor plant Siting challenges Compressed Air Energy Storage Excel
Slide 22: Comparison of Capital Costs
Technology Discussion Comparison of Capital Costs Capital Cost Estimates (Baseload) $8,000 IGCC w/CCS TVA PC w/CCS ‐ TVA $7,000 IGCC w/CCS Ind. PC w/CCS ‐ Ind. Nuclear ‐ Ind. New AP1000 BLN AP1000 Capital Costs ($ / kW) 2009 $ $6,000 Geother ‐ Ind. Biomass ‐ TVA USCPC ‐ TVA Biomass ‐ Ind. IGCC ‐ Ind
Slide 23: Comparison of Capital Costs (Cont’d)
Technology Discussion Comparison of Capital Costs (Cont’d) Capital Cost Estimates (Intermediate & Peaking) $8,000 $7,000 Capital Costs ($ / kW) 2009 $ $6,000 Pump Hydro ‐ Ind. N/A Solar PV ‐ TVA Pump Hydro ‐ TVA CAES ‐ Industry N/A CC w/ CCS ‐ TVA $5,000 Solar PV ‐ Ind. Wind ‐ TVA Hydrokinet ‐ TVA S
Slide 24: Comparison of Capital Costs (Cont’d)
Technology Discussion Comparison of Capital Costs (Cont’d) The following are additional industry sources used by TVA in development of capital costs: Recent TVA experience Energy Information Administration (EIA) www.eia.doe.gov/oiaf/aeo/ Environmental Protection Agency (EPA) www.epa.gov EPRI
Slide 25: Screening Inputs
Technology Discussion Screening Inputs The following table provides detailed input used in supply option screening TVA RESTRICTED AND CONFIDENTIAL 24
Slide 26: Screening Inputs
Technology Discussion Screening Inputs After possible resource options are screened on policy and feasibility/maturity, remaining technologies are subjected to economic screening This screening step compares “busbar costs” for each technology by duty cycle to identify most economic options for base,
Slide 27: Modeling Process for Resource Planning
Modeling Process for Resource Planning
Slide 28: Overview: The Inputs/Outputs of the Planning Process
Modeling Process Overview: The Inputs/Outputs of the Planning Process Existing Supply Side DSM Commodity System Options Options Prices Data Environmental Parameters Constraints Reserve System Margin Capacity Planning Loads Targets Model Purchased Power Options Total Plan Cost Detailed Production Opt
Slide 29: Overview: Identify the Resource Options
Modeling Process Overview: Identify the Resource Options Supply side Purchased power agreements — Develop a list of candidate technology — Consider characteristics for conventional options using internal and external and renewable PPA characteristics sources — Capacity schedule (MW amount) — App
Slide 30: Overview: Constraints and Reliability Requirements
Modeling Process Overview: Constraints and Reliability Requirements Include modeling constraints (boundary Set the reserve margin to ensure an adequate conditions) level of reliability Set to ensure that possible capacity plans Capacity expansion modeling optimizes the reflect strategic and/or o
Slide 31: Capacity Planning: “Optimized” Resource Additions
Modeling Process Capacity Planning: “Optimized” Resource Additions Capacity planning is about finding the optimum combination of resources to meet projected demand/energy requirements over the study period The computer model is designed to optimize new resource schedule based on one key study pa
Slide 32: Wrap-Up Discussion
Wrap-Up Discussion Additional comments Recap of action items and follow-up questions Overall feedback on today’s discussion 31
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