Power Generation Technology Data for Integrated Resource Plan of South Africa
Total Page:16
File Type:pdf, Size:1020Kb
POWER GENERATION TECHNOLOGY DATA FOR INTEGRATED RESOURCE PLAN OF SOUTH AFRICA Technical Update, April 2017 Prepared by: Electric Power Research Institute (EPRI) Power Generation Technology Data for Integrated Resource Plan of South Africa Technical Update, April 2017 Project Manager C. Gross System Operations and Planning EPRI Project Manager C. Lyons ELECTRIC POWER RESEARCH INSTITUTE 3420 Hillview Avenue, Palo Alto, California 94304-1338 ▪ PO Box 10412, Palo Alto, California 94303-0813 ▪ USA 800.313.3774 ▪ 650.855.2121 ▪ [email protected] ▪ www.epri.com DISCLAIMER OF WARRANTIES AND LIMITATION OF LIABILITIES THIS DOCUMENT WAS PREPARED BY THE ORGANIZATION(S) NAMED BELOW AS AN ACCOUNT OF WORK SPONSORED OR COSPONSORED BY THE ELECTRIC POWER RESEARCH INSTITUTE, INC. (EPRI). NEITHER EPRI, ANY MEMBER OF EPRI, ANY COSPONSOR, THE ORGANIZATION(S) BELOW, NOR ANY PERSON ACTING ON BEHALF OF ANY OF THEM: (A) MAKES ANY WARRANTY OR REPRESENTATION WHATSOEVER, EXPRESS OR IMPLIED, (I) WITH RESPECT TO THE USE OF ANY INFORMATION, APPARATUS, METHOD, PROCESS, OR SIMILAR ITEM DISCLOSED IN THIS DOCUMENT, INCLUDING MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, OR (II) THAT SUCH USE DOES NOT INFRINGE ON OR INTERFERE WITH PRIVATELY OWNED RIGHTS, INCLUDING ANY PARTY'S INTELLECTUAL PROPERTY, OR (III) THAT THIS DOCUMENT IS SUITABLE TO ANY PARTICULAR USER'S CIRCUMSTANCE; OR (B) ASSUMES RESPONSIBILITY FOR ANY DAMAGES OR OTHER LIABILITY WHATSOEVER (INCLUDING ANY CONSEQUENTIAL DAMAGES, EVEN IF EPRI OR ANY EPRI REPRESENTATIVE HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES) RESULTING FROM YOUR SELECTION OR USE OF THIS DOCUMENT OR ANY INFORMATION, APPARATUS, METHOD, PROCESS, OR SIMILAR ITEM DISCLOSED IN THIS DOCUMENT. REFERENCE HEREIN TO ANY SPECIFIC COMMERCIAL PRODUCT, PROCESS, OR SERVICE BY ITS TRADE NAME, TRADEMARK, MANUFACTURER, OR OTHERWISE, DOES NOT NECESSARILY CONSTITUTE OR IMPLY ITS ENDORSEMENT, RECOMMENDATION, OR FAVORING BY EPRI. THE FOLLOWING ORGANIZATION PREPARED THIS REPORT: Electric Power Research Institute (EPRI) NOTE For further information about EPRI, call the EPRI Customer Assistance Center at 800.313.3774 or e-mail [email protected]. Electric Power Research Institute, EPRI, and TOGETHER…SHAPING THE FUTURE OF ELECTRICITY are registered service marks of the Electric Power Research Institute, Inc. Copyright © 2015 Electric Power Research Institute, Inc. All rights reserved. ACKNOWLEDGMENTS The following organization prepared this report: Electric Power Research Institute (EPRI) 3420 Hillview Ave Palo Alto, CA 94304 Principal Investigators G. Booras C. Lyons B. Nguyen (Nexant) This report describes research sponsored by EPRI. This publication is a corporate document that should be cited in the literature in the following manner: Power Generation Technology Data for Integrated Resource Plan of South Africa. EPRI, Palo Alto, CA: 2015. iii PRODUCT DESCRIPTION This report is an update of the study results published by EPRI in August 2015. Results and Findings This technical update provides cost and performance data on renewable resource-based technologies such as wind, solar thermal, solar photovoltaic (PV), and biomass; fossil fuel-based technologies such as pulverized coal (PC), fluidized bed combustion (FBC), integrated coal gasification combined cycle, open cycle gas turbine (GT), combined cycle gas turbine (CCGT), and nuclear technologies. In addition, an overview of the biogas and underground coal gasification (UCG) process to produce methane and synthesis gas has been provided. Lead-Acid and Sodium Sulfur battery storage technologies have been added to this update to supplement the renewable energy technologies. This update includes technology enhancements, market factors influence, enhancements to design, and revisions to cost and performance data. The Department of Energy (DOE), South Africa is in the process of evaluating these technologies for future capacity additions, and the data in this report will facilitate the integrated resource plan (IRP) process of South Africa. Challenges and Objectives Power generation technologies are on the threshold of efficiency improvements; at the same time, the question of capital and operating costs of new units is somewhat uncertain due to the impact of a global market demand competing for the same resources. This makes a comparative assessment of these technologies with a consistent approach to the cost and performance analysis essential to a power generation company’s strategy for fleet transition from older to newer units. The objective of this report is to address these challenges and provide data on technologies in a consistent manner. Applications, Values, and Use This study is part of EPRI’s ongoing work to address technology improvements and monitor cost and performance of developing and mature technologies. While EPRI promotes collaborative research amongst members, specific reports tailored to individual countries help EPRI staff to collaborate closely with the member staff and gain perspective on unique situations where the technologies may be deployed. This perspective can then be translated into a much broader collaborative effort to benefit all members. Approach This report is an update of an August 2015 report. It utilizes past EPRI research in power generation technologies’ cost and performance along with EPRI staff expertise to update estimates for South African conditions. v Keywords Power generation Nuclear technologies Coal technologies Natural gas technologies Renewable technologies Storage battery technologies vi EXECUTIVE SUMMARY Introduction The DOE South Africa is in the process of preparing an IRP. The DOE South Africa has stipulated that the data included in the IRP must be obtained from an independent source. To obtain this independently sourced data, ESKOM had engaged the Electric Power Research Institute (EPRI) in 2010 and 2012 to provide technology data for new power plants that would be included in the IRPs. The 2010 and 2012 reports have been extensively reviewed with public comments and acceptance. The 2015 report was a technical update of the technologies’ cost and performance with technology enhancements, market factor influences, and additional technology cases for inclusion in the 2015 IRP. The DOE South Africa has requested that the 2015 report be updated to show the costs at the January 2017 ZAR – US dollar exchange rate. For this update, the 2015 baseline cost for each technology was adjusted to January 2017 US dollar using an annual escalation rate of 2.5%. The baseline costs were then converted to ZAR based on the currency exchange rate on January 1, 2017. This technical update incorporates cost and performance data for a number of power generation technologies applicable to South African conditions and environments. Estimates pertinent to South African conditions were developed based on a compilation of existing U.S. and international databases and adjustments based on third-party vendor indices and EPRI in-house expertise specifically tailored to technology design conditions in South Africa. The scope of EPRI’s effort includes presenting the capital cost, operations and maintenance (O&M) cost, and performance data, as well as a comprehensive discussion and description of each technology. A market analysis on the state of the South African power market was also used to support the cost analysis contained within this report. A summary of that research is below. Global Data energy analysts estimate that South Africa consumed 209 TWh of electricity 2014; a slight decrease of 1.3% from 2012 levels. The decrease in consumption is consistent with trends beginning in 2012. In that year, South Africa faced a power supply crunch, during which consumers were urged to reduce consumption in order to avoid power shortages. Although power demand has grown steadily, generation has fallen due to the need for frequent unplanned power plant maintenance. In addition, Mozambique was affected by floods in 2013, which reduced its electricity exports to South Africa by almost 50%, in turn reducing the amount of power available for supply in South Africa in the same year. Capacity margins were as low as 3.3% in March 2013, compared with around 17% in December 2012 (Viser, 2013). In 2014, South Africa generated 233 TWh and was an overall net exporter of electricity. During the 2015 – 2020 forecast period, electricity consumption is expected to increase from 216 TWh vii to 230 TWh. To support this growth and replace the aging fleet of generating units, energy analysts project an addition of approximately 20 GW of installed power generation by 2020. This growth includes the commercialization of two thermal-fired power plants, Kusile Power Station and Medupi Power Station. Both were expected to begin their operations in 2013 but are still under construction due to labor strikes in the region. Unfortunately, the labor strikes are currently common. This influenced EPRI’s decision to reflect a downward trend in productivity compared to the last IRP report published in 2012. The costs of bulk materials in South Africa have escalated significantly. Although raw material pricing tends to be less expensive in South Africa compared to the United States, the potential savings are offset by higher productions costs resulting from less sophisticated production techniques and lower worker productivity. The rationale for the costs presented in this report is as follows: • Estimates (constant January 2017) represent composite material and labor cost estimates from first quarter 2015.