Large Combustion Plant (LCP) Directive Flexibility Mechanisms

Transcription

1 Large Combustion Plant (LCP) Directive Flexibility Mechanisms By Pat Swords Oct 2014

2 Content of the Presentation What are the Flexibility Mechanisms for existing LCPs What advantages have been found by the Member States The potential for the Turkish implementation of the LCP Directive and next steps

3 What is an Existing Plant? LCP Directive 2001/80/EC defined existing plants as those for which an operating license was granted before 1987, i.e. 15 years before the Directive entered force. Existing plants had two options: Opt out with operation for no more than 20,000 hours by end of December 2015 Opt in and ensure compliance, either by meeting the Emission Limit Values (ELVs) or being part of a National Emission Reduction Plan (NERP) - the flexibility mechanism.

4 Options for Existing LCPs

5 NERP "shall reduce the total annual emissions of NOx, SO 2 and particulates from existing plants to the levels that would have been achieved by applying the emission limit values... to the existing plants in operation in the year 2000,... on the basis of: each plant's actual annual operating time, fuel used and, thermal input, averaged over the last five years of operation up to and including The closure of a plant included in the NERP shall not result in an increase in the total annual emissions from the remaining plants covered by the plan.

6 EU Guidance on NERP clarifies: Compliance with the plan can be achieved by fuel switching, combustion modifications, abatement techniques, load factor management, etc. The process of determining the actual compliance measures will be a matter for individual Member States, taking into account, for example, cost-effectiveness, practicability, impact on security and diversity of their energy supplies, obligations under other Community legislation and other relevant constraints.

7 A Member State can also use a combination of a National Emission Reduction Plan for some plants and direct compliance with the LCP Directive for others. "The National Emission Reduction Plan may under no circumstances exempt a plant from the provisions laid down in relevant Community legislation, inter alia Directive 96/61/EC (IPPC Directive). But Best Available Techniques based on local environmental conditions may lead to Emission Limit Values less strict that those in LCP Directive.

8 A form of emissions trading ensues: NERP is limited to a defined number of LCPs within a country; The total emissions under a NERP are calculated as a bubble for each pollutant. The size of the bubble for each pollutant is the sum of what the emissions would have been if the ELVs that would apply to new plants had applied to each existing plant over the 5 year period ; LCPs with higher costs of control could be expected to purchase allowances from those with lower costs; A form of emissions trading arises financial arrangements are not part of the NERP and rest with participants.

9 Advantage of NERP Plants individually do not have to comply with the ELVs specified in the LCP Directive. Although they will nevertheless have to comply with conditions set in their Pollution Control permits. All plants taken together must keep their total emissions equal to or below the level of the bubble. The bubble sets an upper limit to emissions. More flexible than the LCP ELV approach because some plants could emit more than the ELVs in balance with other plants emitting less.

10 The cost advantage? UK LCP Directive Regulatory Impact Assessment of 2002

11 Submission of Irish semi-state Electricity Supply Board (ESB) on cost of NOx control Moneypoint: 900 MWe coal fired LCP commissioned mid-80s; 250 million desulphurisation and DeNox upgrade by CCGT- Combined Cycle Gas Turbine LNB Low NO x burners SCR Selective Catalytic Reduction Graph overleaf shows options for ESB to reduce NO x emissions from 38,000 tpa and cost per tonne which results at each LCP.

12

13 Base Load Plants which run nearly continuous, such as relatively modern coal plants like Moneypoint with their lower operational costs Mid Merit Plants which fill the gap between the peak load and base load. In some cases the Mid Merit power plants are older and less efficient base-load plants, not effective and cheap enough to run full time. Peaker Plants Plant which can ramp up fast for Peak Loads, but have high operational cost.

14 Bottom Line with ESB: Implementing the same ELVs to existing plants can result in widely different cost basis expressed as tonne of pollutant removed. For ESB difference was a factor of six from 3,000 per tonne of NOx removed to 18,000 per tonne. Particularly acute for mid-merit plants, which have a limited remaining lifespan and operate for reduced hours difficult to recuperate capital investment. One size fits all of identical ELV to each existing LCP is capital inefficient.

15 Experience with Finnish peat fired Circulating Fluidised Bed (CFB) LCPs and NOx control Report prepared as part of Submission to on-going update of EU s LCP Best Available Techniques Reference (BREF) document. Cost basis strongly dependent not only on annual operating hours, but lifespan of investment. With NOx controls, the final incremental step associated with SCR to achieve low NOx ELVs comes with a large cost penalty.

16 Valid Conclusion of Finnish Submission to LCP Best Available Techniques Reference Document In existing boiler plants with less operation time left, it s not feasible to invest in emission reduction techniques with high investment costs, like SCR. In that case, the cost for reduced emissions would be high. Also at boilers with only a few years of operation left in the future, impacts on the environment of little higher emission level is less significant than at boilers to operate for several decades in the future.

17 Member States which used an NERP approach UK, Finland, Ireland, Czech Republic, Hungry, Greece, France, Spain, Netherlands and Romania. New Directive on Industrial Emissions (2010/75EC) continues this approach with Transitional National Plan (TNP) defined in Article 32.

18 Potential for Turkey LCP flexibility mechanisms not transposed into 2010 by-law, but willingness to consider future transposition. Existing lignite LCPs present a financial challenge with respect to a one size fits all approach of applying LCP ELVs. Financial benefits of flexibility mechanisms proven elsewhere, especially with respect to older LCPs with limited run hours and remaining lifespan. Environmental Protection at optimised cost!

19 Next Steps Regulatory Impact Assessment for LCP Implementation being prepared. Operators would need to express an interest in the option of flexibility mechanisms and as to which of their LCPs it would apply. Operators would need to assist this project team in assessing the potential cost savings between applying fixed ELVs to these LCPs or developing an NERP approach for the Turkish implementation.

20 Questions?