Small Scale Distributed Generation Perspectives on Markets and Challenges and Opportunities ARPA-E Workshop June 1-2, 2011

Transcription

1 Small Scale Distributed Generation Perspectives on Markets and Challenges and Opportunities ARPA-E Workshop June 1-2, 2011 Dan Rastler Electric Power Research Institute

2 Discussion Topics Current Status of Small DG in the US Markets and Opportunities Technology Platforms / innovations Pros and Cons of Available and Emerging Technology Lessons Learned from Past Deployments What will it take to increase market penetration and mass adoption? Technology Considerations Business Models Regulatory Framework Why is not DG adopted now? How would high efficiency DG change the landscape? What is the value proposition to electric utilities? 2

3 Summary and Key Take Aways The Market / Opportunity is Large for Distributed Generation There are many natural gas-based technology platforms: ICE most mature; followed by micro turbine; fuel cells; and stirling engines High efficiency, low cost maintenance and high reliability are key factors Mass market penetration will need a key driver : customer pain ; energy services business model; regulatory driver e.g. CHP=energy efficiency Mass market will require appliance like device Value proposition for electric utilities: avoided new central generation; less T&D investment infrastructure; management of customer summer peak loads ; customer retention ( if they can be a participant in the energy services solution). 3

4 Market Research: Drivers for DER Distributed Energy Resources Save money on energy Greater predictability of energy prices More reliable power Improved power quality Capture waste heat for use Use waste products as fuel Strong prospects Soft prospects Environmental benefits More secure power source 0% 20% 40% 60% 80% 100% Source: EPRI / Primen 4

5 DG Market Potential Based on Customers Stated Needs C&I Peak Shaving C&I, CHP C&I, Electric Only C&I, Standby C&I, Premium Power Total Sector Load Offices Government Multi-family Education Stone/glass/clay & Fab Metals Retail Chemicals & Petroleum Food Processing Electronics Primary Metals Transportation Machinery Hotel/motel Paper Textiles Health Care - 100, , , , ,000 Market Potential, MW 5

6 DG Market Potential Based on Customer Economics MM, Residential, 5% Penetration MM, C, SOFC Proxy MM, Microturbine proxy C&I, New Premium Power C&I, Traditional Premium Power C&I, Electric Only Size of Application <74 kw kw kw kw.6-1 MW MW MW 5-10 MW MW C&I, CHP C&I, Peak Shaving - 20,000 40,000 60,000 80, ,000 Market Potential, MW MM= mass market; C= Commercial sector 6

7 Markets and Opportunity by Size of DG in kw Number of US Establishments where DG could be competitive with retail rates 7

8 Potential Regional Markets for DER EPRI Spark Spread has been a Traditional Driver 8

9 Technology Platforms for Distributed Generation Current Options Aero-derivative CT s MW 40+ % Eff. Modular Small CT s 1-5 MW ~ 40% Eff Emerging Trends Microturbines kw 25-30% Eff efficiency increasing Fuel Cells kw % Eff Many on-site markets Diesel and IC Engines MW 36% Eff. efficiency increasing 9 Hybrids? DG + Storage

10 Technology Platforms UTC Power PureCell 400 kw Capstone 100 kw Bloom Energy 100 kw Energy Server VersaPower ClearEdge Power 5 kw CFCL 2 kw Sunverge 2 kw Li-ion 10

11 Technology Platform s: ICE Photo Courtesy Honda kw Honda Micro CHP 11

12 Microturbines 12

13 Technology Platform Fuel Cells Matsu shita City Gas Ebara City Gas Sanyo LPG Sanyo City Gas ToshibaFCP LPG ToshibaFCP City Gas 13

14 Technology Platform- Fuel Cells CFCL 2 kw Micro chp unit 14

15 Technology Platform- SOFC Fuel Cells - Innovation kw - ~ 60% electric eff. LHV Bloom Energy Versa Power 15

16 Technology Platforms: Stirling Engines Photo Courtsey WhisperGen 16

17 Solar-Thermal Stirling Engine Photo courtesy : Cool Energy 17

18 Pros and Cons of Technology Options ICE Pro: Low cost Con: maintenance Micro Turbines Pro: potential high reliability Con: Low electrical efficiency Fuel Cells Pro: High Efficiency; low emissions Con: High cost; limited life Stirling Engine Pro: Potential high reliability Con: High cost, low electrical efficiency 18

19 What will it take to increase mass market penetration of DG Reliable and low maintenance DG Low reliabilty and high maintenance have impacted earlier initiatives High customer pain point on energy costs High cost of electricity and heat; reliability may be a driver in C&I segment but not residential Energy Service Business Models Sell the Services not the DG box A Regulatory Driver for electric utilities to be involved. Many utilities can not own or rate base DG DG bundled as a Smart Grid investment DG = Energy Efficiency 19

20 Summary Cost of Electricity ($/kwh) Natural Gas at $ 12 / MMBtu DG Applications - Cost to Generate Reciprocating Engines Fuel Cells Turbines Micro Turbines Stirling Engines Figure S-1 1 kw CHP (furnace), kw CHP (space heating), 100 kw CHP, $ MW Baseload, $ MW CHP, $0.106 SOFC 1 kw CHP, $0.211* PEMFC 1 kw (space heating), PEMFC 10 kw CHP, $0.268* $0.334* Purecell 400 kw CHP, $0.163 MCFC 200 kw CHP, $0.184 MCFC 200 kw Baseload, SOFC 1MW Baseload, $0.175* $ MW CHP Mercury, $ MW Baseload Mercury, 25 MW CHP, $0.104 $ MW Baseload, $ KW CHP, $ KW Baseload, $ KW CHP, $ KW Baseload, $ kw CHP, $0.236* 1.2 MW Diesel, $0.637 $0.000 $0.100 $0.200 $0.300 $0.400 $0.500 $0.600 $0.700 $0.800 $/kwh *Non-commercialized products. Cost and performance numbers based on expected values for commercialized product, expected in 2-4 years. 20

21 Aggressive Technology Cost Reduction Scenarios for US Market Levelized Electricity Costs for Micro-CHP Units in the US Levelised Electricity Costs (US$c/Kwh) Marginal residential rate in target markets Typical US Residential Grid Price (2009) 0.00 Stirling Engine 2015 (from previous figure) Stirling Engine aggressive cost scenario Stirling Engine aggressive cost scenario and providing water heating Stirling Engine 3 kwe also providing water heating SOFC 2015 (from previous figure) SOFC - 2 kwe, water heater integration and 7,000 running hours per year SOFC - 3 kwe, power only (dumping the heat), 50% efficiency ICE 2015 (from ICE 5 kwe also previous providing figure) water heating 21

22 Comparison DG vs. Grid NYISO Region $0.500 $0.450 $0.400 Non-Baseload Emissions, lbs/kwh DG Technologies Reciprocating 1 kw CHP (furnace mode) Reciprocating 1 kw CHP (space heating) Net power costs ($/kwh) $0.350 $0.300 $0.250 $0.200 $0.150 Solar NYISO Residential Grid Price, $0.169/kWh SOFC 1 kw CHP PEMFC 1 kw CHP PEMFC 10 kw CHP Stirling 1 kw (CHP) Wind $0.100 Nuclear Biofuel $0.050 Combined Cycle IGCC Pulverized coal $ GHG Emissions (lb CO2/kWh) NYISO - Residential Case 22

23 Comparison DG vs. Grid NYISO Region $0.400 Non-Baseload Emissions, lbs/kwh 100 kw CHP Purecell 400 kw CHP Net power costs ($/kwh) $0.350 $0.300 $0.250 $0.200 Solar $0.150 Wind $0.100 Nuclear Biofuel $0.050 Combined Cycle NYISO Commercial Grid Price, $0.162/kWh IGCC Pulverized coal DG Technologies 60 KW CHP 60 KW Baseload 242 KW CHP 242 KW Baseload $ GHG Emissions (lb CO2/kWh) NYISO - Commercial Case 23

24 Comparison DG vs. Grid NYISO Region $0.400 Non-Baseload Emissions, lbs/kwh 1 MW Baseload $ MW CHP Net power costs ($/kwh) $0.300 $0.250 $0.200 Solar $0.150 Wind Biofuel $0.100 Nuclear $0.050 Combined Cycle NYISO Industrial Grid Price, $0.096/kWh IGCC Pulverized coal DG Technologies MCFC 2000 kw CHP MCFC 2000 kw Baseload SOFC 1 MW Baseload 5 MW CHP 5 MW Baseload 25 MW CHP 25 MW Baseload $ * 1.2 MW Diesel = $0.64/kWh and 1.6 lb CO2e/kWh GHG Emissions (lb CO2/kWh) NYISO - Industrial Case 24

25 Comparison DG vs. Grid CAISO Region Non-Baseload Emissions, lbs/kwh DG Technologies 1 kw CHP (furnace mode) 1 kw CHP (space heating) SOFC 1 kw CHP Net power costs ($/kwh) Solar CAISO Residential Grid Price, $0.143/kWh PEMFC 1 kw CHP PEMFC 10 kw CHP Stirling 1 kw (CHP) Wind 0.1 Nuclear Biofuel 0.05 Combined Cycle IGCC Pulverized coal GHG Emissions (lb CO2/kWh) CAISO - Residential Case 25

26 Utility Value Proposition link to Valuation of DG Asset in Smart Grid Virtual Power Plant Integration and Interoperability Leverage information & Communication Technologies Integration of Multiple Types of Distributed Energy Resources (DER): Distributed Generation Renewable Generation Storage Demand Response Multiple Levels of Integration - Interoperability 26

27 Utility Value Proposition - Example Con Edison Smart Grid Demo Interoperability of Demand Response Resources 27

28 Utility / Societal Value Proposition Utility Societal Comments Procure less Avoided Least Cost? Wholesale power Central Gen Reliable? Less T&D Least markets set Investment in Cost plan Infrastructure plan CapEx Deferral New Business Jobs Regulatory Treatment Reduced GHG Support Regulatory RPS Treatment 28

29 Recommendations Comprehensive Study needed of DG, DER, Storage in Smart Grid: Central vs DG Pardigm Tool and Model>> support policy Accelerate development / deployment of highest electrical efficiency options Accelerate plug & play features of DG appliances Conduct Pilot deployment to demonstrate value proposition and costs / benefits to grid / society Advanced Technology Development Impact? 29