AUGUST 2020 Clean Sources of Dispatchable Electric Power Daniel Aycock Stephen Leff Anthony Artuso How can Virginia achieve a 100% clean energy future by 2050? This report explores technologies that could serve as a pathway to a carbon-neutral Commonwealth, includ- ing an overview of how these technologies function, an assessment of their viability, and recommenda- tions for how Virginia should move forward. ABOUT THE AUTHORS Daniel Aycock worked with the Policy Research team during his time with the VA Clean Energy Project. He served as a lead author on this report. He currently works for CustomerFirst Renewables (CFR), a leading clean energy consulting firm advising organizations seeking to access more renewable power. Stephen Leff is a member of the Policy Research team. He works as a Senior Systems Engineer for BWX Technologies. Anthony Artuso directs the Policy Research team for the VA Clean Energy Proj- ect. He is a visiting scholar at the University of Virginia’s Weldon Cooper Center for Public Service. TABLE OF CONTENTS Executive Summary .......................................................................................................................................... 3 Acronym List ...................................................................................................................................................... 6 Framing the Issue ..................................................................................................................................... 8 Methods ................................................................................................................................................... 11 Technology Summaries ......................................................................................................................... 12 3.1 Clean Dispatchable Generation ............................................................................................... 12 3.1.1 Clean Natural Gas ............................................................................................................. 12 3.1.2 Synthetic Fuels (Hydrogen derived) ................................................................................. 17 3.1.3 Nuclear .............................................................................................................................. 23 3.1.4 Biomass ............................................................................................................................. 27 3.2 Long-Duration Storage .............................................................................................................. 28 3.2.1 Batteries ............................................................................................................................ 29 3.2.2 Gravity ................................................................................................................................ 32 3.2.3 Compressed Air ................................................................................................................. 34 3.2.4 Hydrogen ............................................................................................................................ 35 3.2.5 Thermal .............................................................................................................................. 35 Technology Assessments ...................................................................................................................... 37 4.1 Qualitative Assessments .......................................................................................................... 37 4.2 Economic Assessments ............................................................................................................ 38 4.2.1 Baseload Generation ........................................................................................................ 40 4.2.2 Peaking Generation or Dispatchable Storage ................................................................. 42 4.2.3 Long-duration Storage ...................................................................................................... 44 4.3 Synthesizing the Assessments ................................................................................................. 44 Conclusions, Recommendations, and Policy Implications .............................................................. 48 Appendix A – Individual Technology Assessments .................................................................................... 52 Appendix B – Advanced Nuclear Reactor Summary ................................................................................. 67 Appendix C – Electrolyser Technical Summary .......................................................................................... 69 Appendix D – Fuel Cell Technical Summary ............................................................................................... 71 References ....................................................................................................................................................... 73 1 Figure 1: Summary of Clean Dispatchable Technologies ......................................................................... 11 Figure 2: Baseload Generation LCOE Forecast .......................................................................................... 41 Figure 3: Peaking Generation + Dispatchable Storage – LCOE/LCOS Forecast ................................... 43 Figure 4: Clean Dispatchable Technologies assessed by Value and Technical Readiness ................. 45 Table 1: Summary of all technology assessments .................................................................................... 38 2 EXECUTIVE SUMMARY With the signing of the Virginia Clean Economy Act (VCEA), the Commonwealth of Virginia joined a chorus of state-level and utility company commitments to achieve a 100 percent carbon-free electricity system by 2050. Such commitments are a new phenomenon because they have only recently become viewed as feasible, as the costs of wind and solar power and lithium-ion energy storage technologies have fallen precipitously. Reviews of the recent academic literature modeling pathways to a 100 percent carbon-free electricity system show that combinations of commercially available tools and technologies (wind, solar, lithium- ion batteries, energy efficiency, demand flexibility, etc.) can likely achieve high-percentage carbon-free grids (perhaps 80-90 percent) cost competitively, but getting to 100 percent becomes significantly more expensive due to the variable nature of today’s renewable generation sources and the resulting need to overbuild generation and storage infrastructure. In order to achieve a 100 percent carbon-free grid, additional technologies will be needed to provide “clean dispatchable generation” and/or “long-duration storage” to avoid multi-day or seasonal incongruences between supply and demand for power. In this report, we review a set of technologies at advanced stages of development that could meet these needs, including various forms of “clean” natural gas and synthetic fuels, advanced nuclear, biomass, numerous battery technologies, gravity- and compressed air-based storage, hydrogen, and others. We describe the basic principles of each technology for a non-technical reader and summarize their current status and projected future development based on information in the academic literature and commercial press. We also assess and compare each technology along six qualitative criteria (technical readiness, scalability, reliability, flexibility, environmental attributes, and applicability to Virginia). Economic viability based on current and future projected levelized costs is considered for a variety of use cases, including maximum utilization (baseload), low utilization (peaking), and long- duration storage (up to weeks or months of discharge capability). Although these assessments are not location dependent, we highlight key advantages and challenges for implementation in the Commonwealth of Virginia. In order to synthesize our assessments and identify opportunities for future academic work and policy development, we score and plot the more advanced technologies across two dimensions: technical readiness, and a holistic measure of value that includes cost, environmental rating, reliability and flexibility. Results of that multi-attribute evaluation are shown in the chart below. 3 Our assessment indicates that several of these technologies could become important contributors to a carbon-free electricity system. We provide three recommendations to accelerate development and commercialization of longer term storage and clean dispatchable power technologies in Virginia. 1. Establish a policy environment that supports private investment and enables broad innovation: • Develop market structures that reward the full “value stack” provided by energy storage technologies, • Provide policy and regulatory support for pilot- and demonstration-scale projects for later-stage technologies, and • Promote development of infrastructure required for full commercialization. 2. Support development and commercialization of promising technologies where Virginia could provide leadership in the energy transition: • Maintain a broad technology and market development focus beyond lithium-ion for energy storage policy and regulation, beginning with the energy storage task force that recent legislation requires the Virginia State Corporation Commission (SCC) to convene,