To gain a better understanding of the role of the extension of 2 nuclear reactors and the impact of gas prices, EnergyVille analysed the following scenarios and assumptions until 2040:
- ‘UP18’ scenario: lowest cost scenario following the current policy assumptions and trends. In comparison to the 2017 scenarios commissioned by Febeliec the following updates have been included:
- Gas price projections have been adjusted to a more recent publication by the World Bank (10/2017) and are lower than in the 2017 central scenario;
- The capacity of existing gas-fired power plants decreases faster than in the 2017 scenarios (Source: EDF Luminus);
- By 2020 a combined off shore wind cacapcity of 2.2 GW will be operational.
- ‘UP18-Nuc’ scenario: 2 GW of nuclear capacity remain available within the period 2025-2035. The availability of the nuclear capacity after 2025 is 80% per year, but varies between 0%, 50% and 100% since only 2 reactors of 1 GW each are active.
The ‘UP18 scenario’, production capacity and generation
Lower gas prices and the availability of 2.2 GW offshore wind energy in 2020, partly slows down the growth of onshore wind and solar PV (while still reaching the 13% renewable energy target). Between 2020 and 2030 results show that investments in new onshore wind turbines are equal to the 2017 scenarios, reaching the maximum potential of 8.6 GW. New solar PV installations see a slower growth (almost 6 GW in 2030), primarily due to lower gas prices. Investments in new gas-fired generation (power plants and combined heat and power plants(CHPs)) bring the capacity to the same level as the initial scenarios, approximately 6 GW. However, the production of gas-fired plants is about 25% higher in 2030 due to lower gas prices. Similarly, import of electricity is 40% lower (9.3 TWh).
Between 2030 and 2040 the electricity demand in Belgium will rise by 13% to almost 100 TWh per year, due to the up-take of electric vehicles and the electrification of heating (heat pumps). Offshore wind rises to approximately 3 GW and the PV capacity doubles to 10.6 GW. This increase in renewable capacity enables a small decrease in production by gas-fired plants.
The ‘UP18-Nuc scenario’, production capacity and generation
The extension of 2 nuclear reactors, 2 GW of combined capacity between 2025 and 2035, will have very limited impact on the further growth of renewable generation sources according to the TIMES cost optimisation model. Investments in new gas-fired plants will be postponed and the total capacity remains at 4.8 GW in 2030. The generation by gas-fired plants is approximately 30% lower and import 20% lower compared to the UP18 scenario. After the complete closure of the nuclear power plants in 2035 the capacity and generation in the 2 scenarios are identical. This means that in this scenario by 2035 accelerated investments in gas-fired plants will be needed to replace the nuclear capacity and old gas-fired plants. With a technical life-span of 30 years, these new gas-fired power plants could remain operational till 2065. However, this can be in conflict with the long term goal of -80% to 95% CO2 reduction by 2050. Consequently, significant developments and costs reduction in power-to-gas technologies are needed to provide fuel for these gas-fired plants.
Costs of the a‘UP18’ and ‘UP18-Nuc’ scenario.
The impact of lower gas price projection in comparison to the 2017 scenarios is clearly manifested in the annualized cost of the power generation system. The annual cost in 2030 is more than 12% (or 764 million euros) lower in the UP18 scenario compared to the 2017 central scenario. In the UP18-Nuc scenario the annual power system cost in 2030 is 4% (or 235 million euro) lower than in the UP18 scenario, but it has become clear that the most significant decrease (or uncertainty) can be attributed to the gas prices. After the closure of the 2 GW nuclear capacity in 2035 the annual power system costs will rise, bringing the costs of the 2 scenarios in 2040 to the same level of about 7,2 billion euro per year.
Based on the up-dated scenario analysis it can be concluded that the extension of 2 GW of nuclear capacity will have a minimal impact on the annual power system cost during the 10 year lifetime extension period. The commitment for and investment in gas-fired plants will be needed in either scenario and the development of the gas price in the coming years will play a more crucial role in the annual costs.