A NEW APPROACH TO ECONOMICAL ANALYSIS OF ALTERNATIVE ENERGY RESOURCES Prepared by : Zehra Yumurtacı Nur Bekiroğlu Sevgihan Yıldız YILDIZ TECHNICAL UNIVERSITY

A NEW APPROACH TO A NEW APPROACH TO ECONOMICAL ANALYSIS ECONOMICAL ANALYSIS

OF OF ALTERNATIVE ENERGY ALTERNATIVE ENERGY

RESOURCESRESOURCES

PrPreepared bypared by : : Zehra YumurtacZehra YumurtacııNur BekiroğluNur BekiroğluSevgihan YSevgihan Yılılddıızz

YILDIZ TECHNICAL UNIVERSITY

IGEC-2INTERNATIONAL GREEN ENERGY

CONFERENCE

IGEC-199

Especially after the energy crisis, energy issues have become daily life problems and intensive researches are started on alternative energy sources. Today some serious development is achieved.



CONFERENCE

IGEC-199

Unit Energy Cost And Investment Costs Of Alternative Energy

Sources

>Unit Energy Cost And Investment Costs Of Conventional Fossil

Fuels

All the studies conducted today are on reducing the costs of alternative energy generation. While these studies are going on, fossil fuel plants are still working and changing the ecological balance of earth. The values that change the balance is; CO2, CO, NOX, SOX,

Many storms and various losses occur because of the effect of these storms.

acid rainsand green-house effect.

Air Pollution



CONFERENCE

IGEC-199

In the last years, along with the increase of industrial activity, urbanization and the increase of population, both the usage and the amount of pollutants increase.

Pollutants are in gas, liquid and solid phases. Pollutants from various sources mix into the atmosphere in dust, vapour, ash, smoke, fog etc forms.

Pollutants are two types; one directly released to the atmosphere and one type that react with atmospheric compounds and become pollutants.

Pollutants that are emitted directly from pollutant sources are; sulphurdioxide, nitrogen oxides, carbon monoxide, hydrocarbons and solid particles that remain suspended in air.



CONFERENCE

IGEC-199

Human-made pollution sources are mainly; transportation, solid fuels, electric generation plants, fuels used for industry and heating, and industrial processes.

Pollutants and the medium they are in has the same importance regarding pollution. When a pollution study is to be conducted in an area, the meteorological conditions and the chemical structure of the air should be analyzed.

Harmful effects of air pollution



CONFERENCE

IGEC-199

Air pollution has negative effects on human health, materials, visibility range, plants and animal health.

The effects of air pollution on human health occur due to inhalations of high pollutant content in the atmosphere. The air to breathe should be clean in order to have a healthy and comfortable life.

Therefore, air pollution is harmful regarding both the health of living creatures and economical issues.

Pollution effects plants and terminates them or stops their growth. Air pollution also has a damaging effect on artistic and architectural structures.

Green House Effect



CONFERENCE

IGEC-199

Green house gases have an indispensable place in climate systems. Short wave radiation passes through the atmosphere and reach earth surface.

Earth absorbers the sun radiation and emits long wave earth radiation. A part of this long wave radiation is absorbed by the green house gases in the atmosphere and then emitted. These gases are mainly water vapour, carbon dioxide, methane, dinitrogen monoxide and aerosols. It is calculated that without the natural green house gases, earth would be ~30 °C cooler compared to today.

On the other hand, various human sourced increases of these gases cause a significant increase in earth’s temperature.

Acid rains



CONFERENCE

IGEC-199

The main reasons of acid rains are sulphur and nitrogen oxides. Volcanoes, planktons, decayed plants and such natural sources emit sulphurdioxide. Also, burning of fossil fuels like coal and oil has released more than half these gases. As Sulphurdioxide ascends in the atmosphere, it forms sulfate ions. Afterwards, bonds with hydrogen and forms sulphuric acid. Oxidation generally takes place is the clouds with the effect of ammonia and the catalytic effect of ozone. But all of the sulphurdioxide does not transform into sulphuric acid, a major part remains in the atmosphere. Nitrooxides are also important elements of acid rains. The main sources of these pollutants are exhaust gases and power plants. Like sulphurdioxide, nitro-oxides ascend in the atmosphere and form nitric acid. That reaction occurs in highly polluted clouds where iron, manganese, ammonia and hydrogen peroxide exist.

Pollution Due To Energy Production



CONFERENCE

IGEC-199

The man-made emissions are approximately;



CONFERENCE

IGEC-199

The natural emissions of CO2 are approximately;

8 Gigatons CO2/year,

2 Gigatons from deforestation and

6 from the use of fossil fuels.

While this amount seems low; it is the only part which is not offset by carbon removal, and it is growing rapidly as the world economy expends.

200 Gigatons carbon per year.

The same amount is taken out of the atmosphere every year.



CONFERENCE

IGEC-199

• Prevention : avoid formation of CO2 by higher efficiencies in electricity generation, transmission and use,• Recycling of CO2 by capture, utilization and disposal/storage

• Use of renewable sources of energy like hydro, solar, wind, biomass, etc., and use of nuclear power.

1,8 Gton CO2/year are due to electricity generation from combustion of fossil fuels;

4,2 Gton CO2/year are caused by use of fossil fuels in transportation, industry and private homes.

Three strategies are available to reduce the amount of CO2;

The potential to prevent an increase from today’s



CONFERENCE

IGEC-199

1,8 Gton CO2/ year

in 2010 is

1,5 Gton CO2/year

if best available technologies will be utilized in power industry.The potential to recycle CO2 is much higher, but its utilization hinges on costs of fossil fuel generated electricity, which would increase by 50 – 100 %.



CONFERENCE

IGEC-199

This figure shows the evolution of CO2 emissions caused by the combustion of fossil fuels – coal, oil and gas. It can be fairly safely predicted that more electricity needs to be generated as the needs in less developed countries are growing rapidly.



CONFERENCE

IGEC-199

CO2 can be reduced by fuel switching: a pulverized coal-fired power plant produces 0,83kg CO2 per kWh of electricity generated, whereas this number drops to 0,41 in a natural gas fired combined cycle plant.

Only nuclear power and hydro – power do not generate CO2, although there are other environmental concerns that have to be considered for these technologies. Fossil fuels are often the only available resource in many countries, and the choice of fuel very often depends on the availability and economics of exploitation and transportation.

In this paper we will argue that much more can be done now by using best available technologies, and more by using Technologies in the future to prevent the formation of CO2, by more efficient utilization of fossil fuels, be it in the combustion process itself, or be it in the transmission and-use of electric energy.



CONFERENCE

IGEC-199

1990

Natural gas10%

Large hydro1%

Oil21%

Nuclear3%

“New” renewables

1%

Total fosil fuels 45%

Coal13%

Traditional biomass

6%

2000Traditional biomass

5%

Coal13%

Total fosil fuels44%


1%

Nuclear3%

Oil19%

Large hydro3%

Natural gas12%

2004

Natural gas12%

Large hydro3%

Oil18%

Nuclear3%


1%

Total fosil fuels44%

Coal14%

Traditional biomass

5%



CONFERENCE

IGEC-199

Fuels shares in world primary energy use (%)

0

10

20

30

40

50

60

70

80

90

1990 2000 2004

Oil

Natural gas

Coal

Total fosil fuels

Nuclear

Traditional biomass

Large hydro




CONFERENCE

IGEC-199

The damage caused by the emissions of the fossil fuels (according to EU calculations) is shown in table at below. Largest damage is caused by SO2, NOX and PM10. However it is possible to eliminate these gases by installing a desulphurization system next to a thermal power plant. Since CO2 is difficult to eliminate, the actual threat CO2.

Emission Type Damage Costs ($/t)

SO2 13900

NOX 20100

PM10 18900

CO2 (climate change) 1,76-17,6-84

CO2 (geological storage) 0,38-38-380



CONFERENCE

IGEC-199

The countries that produce the largest amount of CO2 are given in Table at below. It can be seen that 65% of total CO2 emission of the world is from these five countries. The rest of the countries have a role of 27%, 25% of the total CO2 production takes place in the USA.

Countries Total CO2 emissions (Mt)

United States 5229

European Union 3180

China 3007

Russia 1548

Japan 1151

Other Countries 7958

Total 22073

CO2 emission values of the countries



CONFERENCE

IGEC-199

CityTotal (O3 + PM10 + NO2 + SO2 + CO) Damage

(t) (gm-2) ($ x 1000)

Atlanta,GA 1200 10,7 6470

Austin, TX 2770 12,6 14500

Dallas, TX 2600 10,5 14200

Houston, TX 2340 13,4 11900

Indianapolis, IN 2910 10,3 15500

Jacksonville, FL 11100 10,7 60800

Kansas City, MO 2620 9,2 13900

Los Angeles, CA 4210 23,1 23300

Nashville, TN 5870 9,1 31000

Oklahoma City, OK

2120 10,4 11900

Virginia Beach-Norfolk, VA

3280 11,5 18300



CONFERENCE

IGEC-199

When the emission values are analyzed, the highest pollution is in Jacksonville with total 11100 tones and 10,7 grams per meter square.

The damage caused by that is 60,8 million$, this table shows emission values of some cities in the USA. The seriousness of the situation can be realized by looking at the values. As the emission values increase, some natural disasters, mainly hurricanes, occur and large scale damages are received.

In this figure, the increase of hurricanes within years can be observed.



CONFERENCE

IGEC-199

The increase of the hurricane damages with years

In this study, only the hurricanes of 2005 and their physical damages are taken into consideration.



CONFERENCE

IGEC-199

We all know that sentimental damages are impossible to compensate. These damages can be reduced by minimizing emission values.

In next table, all the hurricanes that took place in the USA in 2005 are given.



CONFERENCE

IGEC-199



CONFERENCE

IGEC-199



CONFERENCE

IGEC-199

Total damage costs of all the hurricanes that took place in 2005 is approximately 100 billion $.



CONFERENCE

IGEC-199

If this amount were invested in renewable resources, the potential power amount can be calculated using the data in table at below. (Anthony D, Owen, 2006) (Yumurtacı Z, and et al., 2005)

Cost of traditional and renewable energy technologies current and expected trends



CONFERENCE

IGEC-199

The potential power amount that could be obtained if damage costs according to these values were used as renewable resource plant installation, are calculated, Results of the calculations are given in next table.



CONFERENCE

IGEC-199

Power values that can be obtained using fossil fuels and renewable resource plants



CONFERENCE

IGEC-199

According to these results, if the costs of damages created by the hurricanes in 2005 were spent for energy production, approximately 100,000 MW hydro electrical plants can be installed.

Also the unit price of electricity is lower. Furthermore, not so much CO2 would be released to the atmosphere and the CO2 balance would be maintained.



CONFERENCE

IGEC-199

CONCLUSIONS

Today all the studies conducted worldwide aim to decrease CO2 level.

Kyoto protocol signed by some countries forces the nations to decrease greenhouse gases which are harmful by applying penalties. Countries signed Kyoto Protocol undertake the responsibility of keeping the released the gases namely emissions in a certain level.

The goal is to decrease the emissions of the developed countries by 5,2% from the level in 1990 until 2012.

A new system has been developed to achieve this goal which is named as “carbon price”. This is the price for releasing 1 ton carbon to atmosphere and its value is about 7 Euro/ton carbons.These carbon accounts are being implemented newly to the enterprises and it is estimated that if to high cottas are given to the enterprises this price would go to zero in theory.



CONFERENCE

IGEC-199

However, according to optimistic expectations this price would go to as high as 20 Euros if the system is properly implemented. Thus, decreasing the emission level in 1990 by 5,2% until 2012 goal would be achieved. In December 2005, EU ministers decided that a reduction of 25-50% will be necessary. (www,bbc,co,uk,2005)

Global consumption of fossil energy (oil, natural gas, coal) is predicted to increase by 33-45% from 1990-2010. Global anthropogenic CO2 –emissions are predicted or are by 34-46% from 1990-2010 if the present trends are extrapolated. (Dogobert G, Kesel, 2000)

Ecological balance is degraded with increasing CO2 emissions and thus, disasters increase especially, hurricanes in USA have increased dramatically.



CONFERENCE

IGEC-199

In this study, capacities of the power plants which would be erected with the annual monetary losses of the hurricanes have been determined.

In this calculation, highest capacity is supplied by hydro electrical power plants that are about 100000 MW. Unit cost for hydro power is about 6,2 cent/kWh.

Power that would be delivered by Wave, Tide, Biomass and Biogas energy systems is around 62500 MW. But these power plants have higher unit electricity cost than the formers.

Power that would be delivered by wind power systems is nearly 66000 MW. Unit energy cost is 7,4 cent/kWh on average and it is expected to decrease within time.

Geothermal plants are the next options and they have a potential about 60000 MW. The lowest power is delivered by solar power which is around 20000 MW. However, solar plants have very high unit electricity costs.



CONFERENCE

IGEC-199

When these options are compared in all aspects, hydro power is the most appropriate one. Because, it has lower unit initial installation and unit electricity costs.

Besides, it has proven itself as friendly to environment. No emissions would be released to nature if these hydro power plants were installed and electricity was going to be delivered by a clean source of energy.

Consequently, we would have a cleaner, healthier and more reliable world.



CONFERENCE

IGEC-199

THANK YOU

PrPreepared bypared by : : Zehra YumurtacZehra Yumurtacıı[email protected]

Nur BekiroğluNur Bekiroğlu [email protected] Sevgihan YSevgihan Yılılddıızz

[email protected]

Documents

A NEW APPROACH TO ECONOMICAL ANALYSIS OF ALTERNATIVE ENERGY RESOURCES Prepared by : Zehra Yumurtacı Nur Bekiroğlu Sevgihan Yıldız YILDIZ TECHNICAL UNIVERSITY