A MODELLING ANALYSIS OF THE DIFFERENT POLICY OPTIONS … · 2017-11-04 · undergraduate thesis...
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UNDERGRADUATE THESIS OPEN DAY, SESSION 1 2017 A MODELLING ANALYSIS OF THE DIFFERENT POLICY OPTIONS FOR AUSTRALIA’S ELECTRICTY MARKET Author: Alexander Ostermayer Supervisors: Anna Bruce & Iain MacGill SCHOOL OF PHOTOVOLTAIC AND RENEWABLE ENERGY ENGINEERING, UNSW, SYDNEY 2052 AUSTRALIA Energy Market Modelling The Australian Government has committed to reduce national greenhouse gas emissions to 26-28% below 2005 levels by 2030. Considerable emphasis has been placed on Australia’s electricity sector, given its potential as a significant source of emissions reduction opportunities. AEMO + 1. Emissions Intensity Baseline and Credit Trading Scheme (EIS) 2. Explicit tax on CO2 emissions (Carbon Price) 3. Extended Renewable Energy Target (RET) 4. Regulated Closure 5. Current policy - 33,000 GWh RET (BAU) NTNDP 0 50 100 150 200 250 TWh 'All inclusive EIS' 'Coal/Gas EIS' 0 50 100 150 200 250 TWh ‘40-150 Carbon Price' '50% RET' Liquid Fuel Biomass Solar Wind Hydro Natural Gas Brown Coal Black Coal Results: Generation Mix (2017-2040) Scope: Policies Assessed 1. Pathway of carbon dioxide emissions (Annual tCO2-e) 2. Average wholesale price of electricity ($/MWh) 3. Changes to generation mix 4. Investment and retirement Criteria for comparison: 0 40 80 120 160 200 2017 2020 2023 2026 2029 2032 2035 2038 Average Generator Price Received ($/MWh) BAU 40-150 CP 50% RET 800-100 EIS 800-100 Coal/Gas Context Approach How should Australia go about regulating the electricity sector to maximise reduction opportunities? How should policy options be accessed – on what criteria? Aim: To conduct a quantitative comparison between the proposed emission reduction options for Australia’s electricity sector. This was achieved through the use of PLEXOS, a commercially available energy market modelling software package. Data related individual generator characteristics, regional demand forecasts, fuel pricing, and inter-regional transmission constraints were sourced publicly from AEMO (AEMO). Results: Wholesale Prices (2017-2040) 0 50 100 150 200 250 2017 2020 2023 2026 2029 2032 2035 2038 Emissions (tCO 2-e ) BAU 40-150 CP 50% RET 800-100 EIS 800-100 Coal/Gas 28% Target 50% Target Results: Emissions Pathway (2017-2040) Emissions Intensity Scheme – ‘All Inclusive’ vs ‘Coal/Gas’ Both EIS scenarios had identical baseline and emission prices. Comparing both schemes highlights the importance of policy scope. The scenarios had an accumulative difference of 425 MtCO2-e over the 24 year period. Expansion of renewables lacking in ‘coal/gas’ only scenario. Prices similar. Question
Transcript of A MODELLING ANALYSIS OF THE DIFFERENT POLICY OPTIONS … · 2017-11-04 · undergraduate thesis...
UNDERGRADUATE THESIS OPEN DAY, SESSION 1 2017
A MODELLING ANALYSIS OF THE
DIFFERENT POLICY OPTIONS FOR
AUSTRALIA’S ELECTRICTY MARKET
Author: Alexander Ostermayer
Supervisors: Anna Bruce & Iain MacGill
SCHOOL OF PHOTOVOLTAIC AND RENEWABLE ENERGY ENGINEERING, UNSW, SYDNEY 2052 AUSTRALIA
Energy Market Modelling
The Australian Government has committed to reduce national greenhouse gas emissions to 26-28%
below 2005 levels by 2030. Considerable emphasis has been placed on Australia’s electricity sector,
given its potential as a significant source of emissions reduction opportunities.
AEMO+
1. Emissions Intensity Baseline and Credit Trading Scheme (EIS)
2. Explicit tax on CO2 emissions (Carbon Price)3. Extended Renewable Energy Target (RET)4. Regulated Closure5. Current policy - 33,000 GWh RET (BAU)
NTNDP
0
50
100
150
200
250
TWh
'All inclusive EIS' 'Coal/Gas EIS'
0
50
100
150
200
250
TWh
‘40-150 Carbon Price' '50% RET'
Liquid Fuel Biomass Solar Wind Hydro Natural Gas Brown Coal Black Coal
Results: Generation Mix (2017-2040)
Scope: Policies Assessed
1. Pathway of carbon dioxide emissions (Annual tCO2-e)2. Average wholesale price of electricity ($/MWh)3. Changes to generation mix4. Investment and retirement
Criteria for comparison:
0
40
80
120
160
200
2017 2020 2023 2026 2029 2032 2035 2038
Ave
rage
Ge
ne
rato
r P
rice
Re
ceiv
ed
($
/MW
h)
BAU 40-150 CP 50% RET 800-100 EIS 800-100 Coal/Gas
Context
Approach
How should Australia go about regulating the electricity sector to maximise reduction opportunities?
How should policy options be accessed – on what criteria?
Aim: To conduct a quantitative comparison between the proposed emission reduction options for Australia’s
electricity sector. This was achieved through the use of PLEXOS, a commercially available energy market
modelling software package. Data related individual generator characteristics, regional demand forecasts, fuel
pricing, and inter-regional transmission constraints were sourced publicly from AEMO (AEMO).
Results: Wholesale Prices (2017-2040)
0
50
100
150
200
250
2017 2020 2023 2026 2029 2032 2035 2038
Emis
sio
ns
(tC
O2
-e)
BAU 40-150 CP 50% RET 800-100 EIS 800-100 Coal/Gas 28% Target 50% Target
Results: Emissions Pathway (2017-2040)
Emissions Intensity Scheme – ‘All Inclusive’ vs ‘Coal/Gas’Both EIS scenarios had identical baseline and emission prices. Comparing
both schemes highlights the importance of policy scope. The scenarios had
an accumulative difference of 425 MtCO2-e over the 24 year period.
Expansion of renewables lacking in ‘coal/gas’ only scenario. Prices similar.
Question
