WA grid could reach 85% renewables – and cheaper than ‘clean coal’

Repowering WA’s South West Integrated System (SWIS) grid with renewables would not increase the wholesale electricity price. This is the conclusion of modelling by the WA research group Sustainable Energy Now (SEN), using hourly NASA wind and solar data over 10 years.

WA generation has been more expensive than the eastern states because more than 40% is from gas generators less than 30 years old and still being paid off.  There is sufficient gas capacity to provide standby power for 60% renewable energy (RE) generation, enough to replace all coal.

The two oldest coal generators (Muja A and B) are 52 years old and will be closed next year, despite $300 million being spent to refurbish them.

By 2021, 75% of the remaining coal generators will be 31 to 40 years old.  Replacing these with new wind and solar generation would deliver electricity at less than the current cost (Figure 1) and reduce CO2 emissions by 45% (2.1 t CO2 per head).

A high penetration RE generation mix of 85% wind and PV with 15% gas and 6,000MWh of battery storage would cost about $117/MWh, only $3/MWh more than the existing coal/gas/7% RE generation mix, and less than so-called ‘clean’ coal.

Contrary to the AEMO being indifferent as to what ‘strategic reserves’ are used, SEN believes that fast ramping open cycle gas turbines (OCGT’s) with dual-fuel capability are the most effective and proven standby fuelled generation technology.

SEN’s modelling for the 85% scenario shows that about 2500 MW of OCGT capacity and 1000 MW of DSM will be required in addition to the battery storage. All of this is included in the above costing as is the cost of new 300 kV transmission lines to wind and solar farms.

Coal transition scenarios include a conservative cost estimate of $0.5 billion for refurbishment of old coal and liabilities under the 2020 RET.

Figure 1 shows that when a 1.2% annual demand growth to 2030 is taken into account, the 85% RE scenario (blue arrow) reduces CO2 emissions to 15% compared to 2017. New supercritical (so-called ‘clean’) coal with gas (grey line) would cost $2/MWh more and emissions would increase.

Scenarios that maximize nuclear ($203/MWh) and new supercritical coal with carbon capture and storage (CCS) ($146/MWh) are nowhere near cost competitive with the RE scenarios. Retrofitting of the old coal generators with CCS would cost more than the 85% RE scenario and still incur 52% of existing emissions.

Assumed RE technology costs are based on 2016-17 PPA’s reported in Renew Economy (Table 1 below). All RE is costed although up to 30% may be spilled in the high penetration scenarios. Fossil fuel, nuclear and solar thermal generation LCOE’s are calculated using BREE (2013) predicted 2025 CAPEX with cost of capital (WACC) cited from the Finkel Review Report (2017).

The SWIS is an isolated grid about 1/5^th of the area of the NEM and it currently has virtually no storage. It has the advantage of large gas pipelines connecting to NW Shelf gas producers. The 85% scenario assumes 6000 MWh of ‘behind the meter’ battery storage is installed, costed as a $40/MWh subsidy, with the remaining costs recovered by owners reducing their power bills and some income from energy arbitrage.

Another scenario (green arrow in Figure 1) shows that 92% renewable energy could be provided for $129/MWh by including 600 MW of concentrating solar thermal (CST) with 10 hours of molten salt (MS) storage. This is the same cost as ‘clean coal’ with only 7% of the CO2 emissions.

There is potential for pumped hydro storage (PHS) from 2 of the water supply dams and in locations along the coast using the ocean as the lower reservoir.

However, large flows would be required to compensate for the low available heads (< 150m) necessitating very large diameter pipes and large reservoirs, which would increase the cost of these projects. SEN has also modelled a scenario with PHS (Figure 1), but it is more expensive than the CST/MS option.

Regardless of whether or not CST /MS or PHS is added later, 85% wind and solar with battery storage is now the most economic plan for clean energy on the SWIS and it could be achieved by 2030.

SEN’s SIREN and Powerbalance software is free to use and downloadable from: http://www.sen.asn.au/modelling_overview. It can be used anywhere in the world by downloading NASA ‘MERRA’ solar and wind data for the location.

Ben Rose is Principal Energy Modeller for Sustainable Energy Now