MODELLING A RESILIENT UK ENERGY SYSTEM

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MODELLING A RESILIENT UK ENERGY SYSTEM

• Sussex Energy Group Seminar
• UK Energy security What do we know, and what
  should be done?
• 27 January 2009
• Jim Skea, Modassar Chaudry, Kannan Ramachandran
  and Anser Shakoor

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UKERC Energy 2050 Project

• The UKERC Energy 2050 project aims to show how
  the UK can move towards a low-carbon energy
  system over the next forty years .... the project
  focuses on the two primary goals of UK energy
  policy achieving an 80 per cent reduction in
  carbon emissions by 2050 and ensuring that energy
  is delivered reliably.

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Broad Methodology

• underpinned by high-level core scenarios
• set of scenario variants which address key
  energy policy issues
• a range of UKERC models are the integrating
  analytical tools.but no direct coupling of
  different models
• four cross-centre working groups owning
  specific issues/workstreams and scenario
  variants
• energy supply
• energy demand
• energy markets and security
• energy policy

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Core Scenarios
ENERGY SYSTEM ATTRIBUTES
Resilience
Low Carbon
 
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UKERC Energy 2050 workstreams

• Pathways to a Low Carbon Energy System
• Technology acceleration
• Energy security and resilience
• Lifestyle and Consumption
• Environmental Sensitivities
• (Global Energy Markets)
• (De-centralised energy systems)

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Modelling Tools

• System level models
• MARKAL Elastic Demand (MED) a technology rich
  linear optimisation model of the integrated UK
  energy system, including a wide range of supply
  and demand side responses
• E3MG econometric model, which can be used to
  forecast changes in economic structure, the
  energy system and associated environmental
  impacts
• Network Industry Models
• WASP Wien Autonomous System Planning Model
  electricity generation planning (mixed integer
  programming)
• CGEN Combined gas and electricity network
  non-linear
• Energy Demand Sectoral Models
• Domestic buildings
• Non-domestic buildings
• Transport

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SECTORAL MODELS
Energy service demands
MARKAL-MED
Electricity demand
Gas demand
WASP
System shocks
Resilience indicators
Generation mix
CGEN
Infrastructure
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Security and resilience workstream

• Agree resilience indicators
• Experiment with models to assess interaction
  between indicators and determine interesting
  quantitative specification
• Formalise resilient energy system scenarios
• Use models to assess technology choices/costs
  associated with resilience and compare with low
  carbon scenarios
• Based on literature review, determine a plausible
  set of energy system shocks with a 2025 time
  horizon
• Subject reference, low carbon and resilient
  energy systems to these shocks
• Assess costs and advantages of resilience (not a
  formal CBA as no probabilities attached to
  shocks, nor do they represent full set of
  possibilities)
• Policy analysis

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Resilience Indicators
Resilience is the capacity of an energy system
to tolerate disturbance and to continue to
deliver affordable energy services to consumers.
A resilient energy system can withstand shocks
and provide alternative means of satisfying
energy service needs in the event of changed
external circumstances.

• Supply
• Diversity of primary supply
• Diversity of fuel inputs for electricity
  generation
• Demand
• Reduced final energy demand (and hence exposure
  to energy prices)
• Infrastructure
• Diversity of import options
• Storage (coal, oil and gas)
• Capacity margins in the network industries
• Redundancy in network infrastructure

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Quantification of resilience

• Supply
• No single energy source to take up more than 40
  of primary energy supply
• No single energy source to take up more than 40
  of electricity generation mix
• (we note HHI diversity index as model output but
  cannot use to constrain runs)
• Demand
• UK final energy demand roughly 1.25 annual
  decline after 2010 (3.2 decline relative to GDP)
• (in early years this is roughly compatible with
  an assumption of the high impact of additional
  policies from Updated Energy and Carbon
  Emissions Projections November 2008)
• Infrastructure
• Diversity of import options (can use HHI index as
  a constraint)
• Storage - hard-wired
• Capacity margins in the network industries

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Resilience and low-carbon scenarios key
indicators for 2025 relative to 2000
Resilience
Primary energy demand -20 Final energy demand
-16 Electricity demand 0 Residential demand
-34 Max primary share 39 Max genmix share
40 CO2 emissions -19 CO2 intensity power
464g/kWh Welfare costs

Low Carbon
Primary energy demand -13 Final energy demand
-2 Electricity demand 8 Residential demand
-9 Max primary share 44 Max genmix share
25 CO2 emissions -30 CO2 intensity power
188g/kWh Welfare costs
Primary energy demand -20 Final energy demand
-16 Electricity demand -7 Residential
demand -30 Max primary share 39 Max genmix
share 40 CO2 emissions -30 CO2 intensity
power 360g/kWh Welfare costs
 
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Carbon intensity of grid electricity
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Key conclusions

• the low-carbon scenario contributes to reduced
  energy (import) dependence, but does not go far
  enough to meet overall security goals
• the resilient scenario reduces CO2 emissions, but
  does not go far enough to stay on the pathway to
  the 2050 80 reduction goal
• reduced energy demand is the key to resilience,
  electricity sector de-carbonisation to low carbon
• the residential sector is critical in reducing
  energy/import dependence
• the electricity sector is also key to diversity
  cheap alternatives allow either diverse or low
  carbon generation mixes to make big contributions
  to overall goals
• there is remarkably little progress in
  electricity de-carbonisation in the resilience
  scenario, and progress is slower if resilience
  constraints are added to the low carbon scenario
• in the reference scenario, diversity of primary
  energy (just) meets the resilience
  constraint....the generation mix does not.
• in the low carbon scenario, diversity of primary
  energy fails to meet the resilience
  constraint....generation mix is most diverse in
  the pure low carbon scenario because of the
  uptake of nuclear power.

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The shocks....

• Oil
• Review of past events suggests manifested in
  elevated prices on timescale of months-years
• 200/barrel (with gas price consequences) for 5
  years
• Gas
• Review of past events suggests manifested in
  curtailment/elevated prices on timescale of
  weeks-months
• Loss of Easington terminal at start of winter
  (knocks out Langeled pipeline from Norway plus
  Rough storage)
• Electricity
• Review of past events suggests manifested in
  curtailment on timescale of hours-days
• Specific shocks under development

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Crude oil prices 1861 -2007
Source BP Statistical review of world energy 2008
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Future work

• UKERC Phase I
• model the shocks
• cost-advantage analysis
• policy analysis
• UKERC Phase II
• more work on the external context within which
  the UK operates
• deeper analysis of the relative contributions
  that individual indicators make to security
• investigation of the contribution of demand side
  measures to energy system resilience
• more formal use of diversity indices
  Herfindahl-Hirschman Index Stirling index with
  different levels of disparity between
  technologies/supply sources

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UK Energy Research Centre
www.ukerc.ac.uk