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Properties of Deeply Decarbonized Electric Power Systems with Storage

Properties of Deeply Decarbonized Electric Power Systems with Storage

Full Title: Properties of Deeply Decarbonized Electric Power Systems with Storage
Author(s): Cristian Junge, Cathy Wang, Dharik S. Mallapragada, Howard K. Gruenspecht, Hannes Pfeifenberger, Paul L. Joskow, Richard Schmalensee
Publisher(s): MIT Center for Energy and Environmental Policy Research
Publication Date: February 25, 2022
Full Text: Download Resource
Description (excerpt):

In order to illuminate the role of energy storage in future decarbonized electric power systems, we construct detailed models, calibrated to midcentury, of optimal assets and hourly operation of power systems under a range of assumptions about generation and storage technologies’ availability and cost. We model three US regions: The Northeast, the Southeast, and Texas. These regions differ in many dimensions, notably in the quality of their variable renewable energy (VRE, wind and solar) resource and load profiles. We find that nearly complete decarbonization of all three systems using only VRE generation and (very little) natural gas, along with Lithiumion storage, can be achieved without reduced reliability or very large increases in system average electricity cost. The incremental cost of going to complete decarbonization of the electric power system without any offsets from other sectors is very high, however, comparable or higher than estimated costs of negative emissions technologies. If technologies more suitable for longduration storage are available, they optimally substitute for dispatchable natural gas capacity and, under plausible assumptions, produce only moderate reductions in system average electricity cost. Substantial industrial demand for hydrogen would make its use for storage in the electric power system more attractive. In decarbonized power systems, the distribution of the hourly marginal value of energy (MVE), which corresponds roughly to the wholesale spot price, will be drastically different from the distributions of spot prices in current systems: there will be more hours of high MVEs and many more hours of very low MVEs. In order to encourage efficient economywide decarbonization, wholesale markets and retail rate structures will need to be significantly modified. In addition, research in the design, operation, and regulation of decarbonized systems should be a high priority.

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