Electricity system optimization in the EUMENA region

This report describes results of a techno-economic model optimizing a potential electricity generation system in the EUMENA region for the year 2050. In 32 scenarios, cost optimal systems for electricity generation, transmission and storage are calculated. The optimization goal is minimization of total system cost for annualized investment, operation and maintenance costs as well as fuel costs for the complete system. This includes cost elements for power plants, transmission networks and large-scale hydro as well as thermal storage. Costs for the national distribution grid are not included in this model. The optimized systems must satisfy a strict CO2 reduction goal of 95 % compared specific emissions (gCO2/kWhel) in the year 1990. In some scenarios, this requirement is replaced by a fixed CO2 price that increases costs for use of fossil fuels (Coal, Gas). All solutions are compared by contribution of energy resources to electricity generation and by the resulting cost of electricity. Cost optimality together with the goal to reduce greenhouse gas emission renders the optimal solution in the Base scenario a mix of all available renewable energy sources, with an emphasis on onshore wind power. Major contributors are offshore wind, photovoltaic, concentrating solar power, biomass and hydro power; remaining fluctuations are regulated using combined cycle power plants fueled by natural gas, as far as the CO2 reduction goal allows. The possibility to connect EU and MENA is exploited in order to balance the power input of fluctuating renewable sources. In scenario Base, more than 25 % of European electricity demand is imported from MENA countries. The interconnectors between the two regions have a summed capacity of 188 GW and annual full load hours from 3100 to 7100. These values are significantly higher than other transport lines that have mean full load hours of 2200. Annual total system cost – excluding national distribution – in the base scenario are as high as 324 B€, corresponding to electricity costs of 73.0 €/MWh consumed. This means 5 % lower system costs compared to disconnected EU and MENA systems (scenario 03). Approximately 77 % of the costs are dedicated to generation. Only 9 % are for transport network (neglecting the distribution grids) and 14 % for storage. These shares are quite stable for all investigated scenarios. For comparison, in the cheapest simulated scenario 22 (without restriction on CO2 emissions and no CO2 price), total system cost are as low as 243 B€ or 25 % below base scenario. Wind power is dominating source for electricity production with a share on overall electricity production of around 50 % in all main scenarios. PV accounts for another 10-15 %, whereas the share of CSP is about 3-10 % in main scenarios. The remaining electricity is provided through hydro, biomass and gas fired power plants. Wind power is dominating because of its comparatively low investment costs as well as very good balancing of wind power between regions in a huge and connected power system. Existing hydro storage capacities in European countries, in total 206 TWh from pumped storage and dam lakes, are sufficient to create feasible solutions in all scenarios; flexible CSP is thus used to a relatively small amount, indicating only a minor need for additional 10 storage capacities. In disconnected systems however, more CSP is used for stabilizing the local energy balance in MENA. A sensitivity analysis shows major changes in the optimized system configuration. Changed investment costs for renewable energy technologies increase or decrease their share in the optimal electricity generation mix. Consequently, onshore wind exhibits the biggest absolute changes in the electricity generation. Availability of nuclear power dominates the electricity generation in all countries. CCS has only minor impact on the optimal solution. In scenarios without CO2 limits and low CO2 prices (0, 50 €/t), coal fired power plants provide major shares of electricity, while high CO2 prices (100, 150 €/t) lead to solutions comparable to the base scenario with CO2 limit. The first four main scenarios investigate the influence of high and low future electricity demand and compare a connected EUMENA system with two separated systems in Europe and North African/Middle East countries without interconnections. The remaining 28 scenarios are about sensitivities to changed input parameters. In chapter 2, the model is briefly described. Chapter 3 describes all modeled scenarios. In chapter 4, results of the four main scenarios are discussed in detail. Chapter 5 then highlights the key changes in the system caused by the parameter changes in the remaining scenarios, grouped by scenario types: these are cost variations for technologies (wind onshore and offshore, PV, CSP), availability of technology (nuclear power and CCS), economic parameters (WACC) and political restrictions (grid restrictions, autarky). Parameters and data sources are presented in chapter 6.     «

This report describes results of a techno-economic model optimizing a potential electricity generation system in the EUMENA region for the year 2050. In 32 scenarios, cost optimal systems for electricity generation, transmission and storage are calculated. The optimization goal is minimization of total system cost for annualized investment, operation and maintenance costs as well as fuel costs for the complete system. This includes cost elements for power plants, transmission networks and large-...     »