Research on power-supply cost of regional power system under carbon-peak target

0 Introduction

In 2020, China clearly established “China’s goal to realize carbon peak by 2030 and achieve carbon neutrality by 2060”, demonstrating China’s firm determination to actively assume the international responsibility for addressing climate change and building a community with a shared future for mankind.Electricity is the central part of the energy transition and a key area for realizing carbon-peak targets.Electric power is the industry with the largest carbon emissions, accounting for 42.5% of carbon emissions in the energy industry in 2020, which is more likely to achieve decarbonization than others from technical and economic perspectives.Therefore, the low-carbon transition in the power industry is crucial for the realization of the “30 ·60” goal.

After China’s “30 · 60” goal was proposed, many research institutions have explored the low-carbon development path.Guided by the “30 · 60” goal and global long-term objectives established in Paris Agreement, the Institute of Climate Change and Sustainable Development,Tsinghua University, analyzed emission reduction paths,technical support, and costs under different policy strengths and temperature-rise constraints from an energy perspective.In this research, the investment in the new infrastructure of energy and power systems, the construction of terminal energy saving and energy replacement infrastructure, and the reconstruction of existing facilities were regarded as cost constraints.However, there was a lack of targeted research on power systems [1].Based on this research, Li Zheng et al.focused on exploring the low-carbon transition path of the power industry, and established an electricity planning model based on typical daily power balance constraints [2] [3].However, these authors mainly considered the construction costs of the power supply and energy storage systems, coal power stranded costs, and carbon capture costs.The costs of adaptive transformation and strengthening of the electric power system owing to the large scale of new energy sources were not considered.They neither considered the time value of the investment cost in the life cycle nor included the pure cost of maintaining the system operation.The State Grid Energy Research Institute divides the cost of power systems into construction investment cost, operation and maintenance cost and environmental emission cost, and analyzes the changing trend of power system cost in the form of average cost per kWh [4].However, the study did not analyze the trend of cost change from the perspective of the life cycle.In addition, only the incremental part of the power-system cost was considered, and the impact of the inertia of the stock part of the power system on the system cost was not considered. [5] and [6], adopted the levelized cost of energy (LCOE) as a measure, which can only reflect the life-cycle cost changes of different power sources, but cannot reflect the system cost brought by largescale new energy access.In other studies [7-10], a variety of models were adopted to construct various feasible paths of carbon peak and carbon neutrality in China from “top-down”or “bottom-up” perspectives; however, the system cost of the carbon-emission reduction path was not considered.

In addition to a series of studies on the carbon-emission reduction path of the energy and power industry [11] [12],foreign research institutions have further studied the cost of decarburization for power systems.In reference [13], the authors initially established the concept of system cost and suggested that the levels of the power plant, grid, and system should be considered to evaluate the power technology costs.The results show that nuclear, coal, gas and other traditional power sources with good peak regulation performance and scale effect have lower additional costs.Wind power, photovoltaic and other new energy due to the intermittent characteristics of peak load regulation, backup and power grid construction, etc.In reference [14], the authors further divided the system costs into four categories of generalized costs, namely construction, balance, grid,and connecting costs.This study compared the total power system costs of six different scenarios with low-carbon constraints, and analyzed the change law of system costs under different values of permeability for wind power and photovoltaic power.However, the system cost division in the above study cannot completely cover the whole link of power supply, and the cost division interface is also different from the investment and construction structure of China’s power system; the relationship between stock and increment or the complex situation of China’s power system has not been covered.

Relevant studies generally focused on systems relatively close to large power grids at the national level.However,provincial and regional power systems will face more restrictions on energy and resource development and more complex inter-regional power flows, and the existing system cost models cannot meet the needs for cost calculation of regional-power-system low-carbon transformation.

Therefore, based on the concept of power system cost,this study focuses on the characteristics of regional power systems, comprehensively considers the relationship between the inertia of system stock cost and the disturbance of incremental cost, and constructs a cost calculation model of regional power systems under a carbon-peak target from the perspective of the life cycle.The system cost of the whole process of power supply, power transmission,system enhancement, operation, and maintenance caused by the realization of a carbon peak finally will transferred to the user side.From the perspective of the kWh cost of electricity, the power supply cost of the system with different carbon peak paths can be more intuitively judged,and the model is able to assist to carry out carbon-peak path planning and formulating relevant policies more scientifically.

1 Overview of power system costs

New energy resources have been widely deployed in recent years.With the continuous development of wind power and PV technology, the LCOE is gradually approaching, or even below, conventional energy.However,with access to a large amount of new energy, auxiliary investments such as supporting power grid construction,scheduling and operation optimization, standby services,and capacity inequality are increasing.In 2012, the Nuclear Energy Agency first defined these types of cost as system costs [13].All power generation technologies, e.g., nuclear power, have system costs and require strong network connections and reliable cooling sources.However, these costs are one order of magnitude below the intermittent cost of new energy sources [14].Therefore, in a power system with high permeability to new energy under the target of carbon peak, the LCOE can no longer meet the comparative demand of energy cost, and the impact of different energy sources on the power grid should be comprehensively reflected through the system cost.

System cost has become a generally accepted concept in power system analysis.It has been generally divided into four categories, namely configuration cost-the power generation cost of the entire power system; balance cost-the cost generated by the uncertainty in the power generation process; grid cost-the transmission and distribution cost due to the distributed nature and location constraints of new energy power plants; and connecting cost-the cost of connecting the power plant to the nearest transmission grid connection point.The impact of rising new-energy penetration on system costs shows a marginal increasing trend.The growth rates of the four types of costs vary.In a mediate-scale system, when the new energy accounts for 10%, the system cost is approximately 5% higher than the traditional system cost; when the proportion reaches 30%,the system cost increases by 21%; when the proportion reaches 50%, the system cost increases by 42%; and when the proportion reaches 75%, the system costs almost double [14].

Under the strong constraint of realizing the “double carbon” goal, the energy structure turns to more green and environmental friendly, and the system cost will become a constraint factor should not be ignored in a power system with new energy sources as the main power source.In addition to ensuring the safe and stable operation of the power system, meeting the growing electric power demand,and realizing the carbon-peak target, the affordability of the system cost should also be considered to ascertain the economic feasibility of the carbon-peak path of the power system.Previous studies on the system cost weakened the inertia restriction of the stock system and ignored the increase of the low-carbon system cost concerning the highcarbon energy cost and the operation and maintenance cost necessary to maintain the safe and stable operation of the power system.Besides, the division of the system cost is insufficient to match the status quo of the power system.The division of system cost is also insufficient to match the current situation of the power system.On the one hand, according to the division of conventional investment interface of power engineering construction in China, the access cost of new power supply is invested by the power supply builder, which is usually included in the power supply cost, rather than divided into configuration cost and connecting cost.On the other hand, in addition to the network cost of serving new energy, the transmission and distribution cost in China also includes the strengthening cost of the stock network, the construction cost of longdistance channels and the operation and maintenance cost.Therefore, it is necessary to build a comprehensive targeted power-supply cost calculation model of the regional power system that considers the relationship between stock and incremental distribution.

2 Power system cost measurement model

2.1 Model description

Combined with the actual construction and operation of China’s power system, this study reclassifies the coverage range of the system cost, including the whole process cost from generation to electricity consumption.The kWh system cost is calculated from the perspective of the life cycle, to reflect the difference more directly and clearly in the impact of different carbon-peak paths on the terminal energy cost.

The cost of a regional power system is divided into three parts: power-supply cost, transmission and distribution cost,and regulation cost.

The configuration cost and connecting cost are combined into the power-supply cost according to the ownership of the investment, including increase the carbon reduction cost and revenue power cost.The grid cost is defined to cover transmission and distribution cost, which contains the conventional strengthening cost and operation and maintenance cost of the power grid in addition to the power grid strengthening cost caused by the increase of new energy penetration rate.Adjust the original balance cost to regulation cost, more accurately express its role in the power system.

The power-supply cost includes the stock and increment parts.The stock part includes the grid cost of the power generation in the stock system, whose increase is caused by the reduction in the capacity of high carbon energy owing to the carbon-peak target, and the power supply cost from outside the region.The incremental part includes the construction cost, the investment of new power supply and the cost of generation, access cost, construction cost of new power access system channels, electricity received cost, and power-supply cost from outside the region.

The cost of transmission and distribution is also divided into stock and incremental parts.The stock part includes stock-fixed assets and operation and maintenance costs of the network.The incremental part includes the target cost of serving carbon, which is the cost of building new clean-power transmission channels outside the region to realize the carbon-peak goal, and the cost of strengthening the distribution network that must be deployed because of the increase in the proportion of new energy in the system.There is also the operation and maintenance cost of maintaining a safe and stable operation of the power system.

The regulation cost includes the existing pumpedstorage and energy-storage system operation cost in the storage system, as well as the construction and operation cost of new pumped-storage and energy-storage systems to adapt to a high proportion of new energy power systems.

The basic composition of this model is shown in Fig.1.

Fig.1 System cost structure

2.2 Mathematical Framework

(1) Power supply cost (CF)

Concerning the stock power supply cost, the initial annual stock power generation cost is the power grid price.The subsequent annual-stock power generation cost is the sum of the power generation cost of the previous year and carbon reduction cost.The initial annual electricity received cost is the settlement price of electricity imported from outside the district, it is defined that the cost of electricity received in subsequent years is the cost of the previous year.Regarding the incremental power-supply cost, the construction cost is the life-cycle kWh cost of the investment in the construction of a new power supply and access system channel, whereas the electricity received cost is the settled price of the electricity supplied by the new transmission channel outside the area.The powersupply cost is the weighted average of the stock cost and incremental cost, with the quantity of electricity as the weight.The power-supply cost is calculated as follows:

where CF,t is the power generation cost in year t; Ωs is the collection of power-supply varieties; Ωq is the collection of channel type; CF,k,t is the power generation cost of power supply k in year t; CF,j,t is the electricity received cost of channel j in year t; CP,k is the feed-in electricity price of power supply k; CFINC,k,t is the incremental cost of power generation in year t; and CD,t is the carbon reduction cost in year t.

(2) Transmission and distribution cost (CS)

With respect to the transmission and distribution cost,the initial annual-stock cost is the initial annual approved transmission and distribution price, and the subsequent annual-stock cost is the transmission and distribution cost of the previous year.The incremental transmission and distribution cost comprises the service carbon target cost, power grid improvement cost, and operation and maintenance cost, which is the life-cycle kWh cost benefiting from the whole society’s electricity consumption.The cost of transmission and distribution is the weighted average of the stock cost and the incremental cost weighted by the quantity of electricity.The transmission and distribution costs are calculated as follows:

where CS,t is the power transmission and distribution cost in year t; Cd is the comprehensive power transmission and distribution price; CSINC,t is the incremental cost of power transmission and distribution in year t; QINV is the weighted average coefficient of stock cost; QINC is the weighted average coefficient of incremental cost.

(3) Regulation cost (CB)

Concerning the regulation cost, the initial annual storage cost is the initial annual storage energy storage and pumped storage energy kWh cost; the subsequent annual storage cost is the transmission and distribution cost of the previous year.The investment and operation costs of energy storage and pumped storage are the life-cycle kWh cost electricity generated by the entire society.The regulation cost is the weighted average of the stock cost and incremental cost weighted by electric quantity.The regulation cost is calculated as follows:

where CB,t is the regulation cost in year t; CE is the initial annual regulation cost; CBINC,t is the incremental cost of regulation in year t; QINV is the weighted average coefficient of stock cost; QINC is the weighted average coefficient of incremental cost.

(4) Power system cost (C)

The formula of the power system cost is:

where Ct is the power system cost in year t; CF,t is the power-supply cost in year t; CS,t is the transmission and distribution cost in year t; CB,t is the regulation cost in year t.

2.3 Basic Data

(1) System characteristic parameters: obtained by the production simulation system.

(2) Unit cost of power supply: The year-by-year prediction curve is formed according to the historical data and considering the impact of technical upgrades on costs.

(3) Total electricity consumption: Regional powerdevelopment-planning forecast data are used.

(4) Investment in transmission and distribution networks:A prediction curve is formed according to the relationship between historical investment in power transmission and distribution networks and new energy permeability.

3 Case study analysis

Taking a certain region in China as an example, this section analyses and compares the system cost between two schemes with different power supply structure.

Scheme 1: “new energy + channel” (N + C).A combination of high proportion of new energy and longdistance transmission channel

Scheme 2: “high nuclear power” (H-NPS).A combination of new energy and nuclear power

It also designs two scenarios-base load scenario and high load scenario-according to different load levels based on data forecasting.

3.1 Computing method

The financial benefit and cost estimation method in Economic Evaluation Methods and Parameters of Construction Projects [15] is applied in this study to reversely deduce the life-cycle kWh cost of different power sources and channels through fixed FIRR.

The calculation process adopts BOOWAY power engineering economic evaluation software.The input parameters and selection rules are shown in the following table 1.The calculation process is shown in Fig.2.

Fig.2 The kWh cost calculation process

3.2 Basic data

Setting 2020 as the benchmark year, and considering the electrification process of different terminals in the region,the maximum load of the entire society in a certain region is predicted through two approaches: base load scenario and high load scenario.The prediction results of the two schemes are shown in Table 2.

Table 1 The life-cycle kWh cost calculates the input parameters and the selection principle

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Table 2 Prediction of the maximum social load of a regional power grid Unit: MW

Scene 2020 2025 2030 2035 Base load 40320 60000 70540 76850 High load 40320 60000 72300 79830

continue

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The main power sources in this area include photovoltaic power station (PV), wind power station (WP), hydropower station (HYP), coal-fired power station (CFP), combined heat and power generation (CHP), gas power plant (GP), nuclear power station (NPS), biomass power generation (BMP),supporting electrochemical energy storage power station(ESP) and pumped storage power station (PSP) to meet the requirements of system regulation, as well as ultra-high voltage transmission channels (UHV) to receive external circuits.

Based on different load scenarios, a production simulation system was used to calculate the two scenarios of “new energy + channel” and “high nuclear power”.Four different carbon-peak path schemes were obtained.The scale of the new power-supply installations and channels in different path schemes are shown in Fig.3-Fig.6.

Fig.3 New power installations and channel scale under base load scenario-New Energy + Channel

Fig.4 New power installations and channel scale under base load scenario-High Nuclear Power

Fig.5 New power installations and channel scale under high load scenario-New Energy + Channel

Fig.6 New power installations and channel scale under high load scenario-High Nuclear Power

The carbon-peak year, carbon dioxide peak, and cumulative carbon emissions from the regional power grid under different carbon-peak path schemes for a period of 35 years are shown in Table 3.

Table 3 Carbon emission under different carbon-peak path schemes Unit: billion tons

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The unit cost of various power sources and transmission channels is shown in Fig.7.

Fig.7 Power supply and channel unit cost

The benchmark FIRR for different power sources and channels that can maintain break-even is as Fig.8.

Fig.8 The benchmark FIRR for different power sources and channels [15]

3.3 Calculation results

(1) Power-supply cost (CF)

According to the calculation model of power-supply cost, the regional power system, and the incremental cost of the entire life cycle of the power supply and transmission channels under the condition of basic return rate in different schemes can be obtained by using economic benefit calculation software; the results are shown in Fig.9-Fig.12.

Fig.9 Incremental cost of power supply and transmission channel under base load scenario-New Energy + Channel

Fig.10 Incremental cost of power supply and transmission channel under base load scenario-High Nuclear Power

Fig.11 Incremental cost of power supply and transmission channel under high load scenario-New Energy + Channel

Fig.12 Incremental cost of power supply and transmission channel under high load scenario-High Nuclear Power

In addition to the new power supply and transmission channels, and as a result of the constraint of carbon peak,coal and thermoelectric power generation will be reduced to different degrees, so the carbon reduction cost (CD) should be considered.The carbon reduction cost per unit can be obtained by calculating the equivalent yield rate of a single unit, as shown in Table 4.

Table 4 Carbon reduction cost of reduced power supply under different carbon-peak paths Unit: CNY/kWh

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The generation cost of all types of power sources, the electricity received cost of the transmission channel, and the power-supply cost can be calculated using Eqs.(1-3); the results are shown in Fig.13-Fig.17.

Fig.13 Different power and channel costs under base load scenario-New Energy + Channel

Fig.14 Different power and channel costs under base load scenario- High Nuclear Power

Fig.15 Different power and channel costs under high load scenario-New Energy + Channel

Fig.16 Different power and channel costs under high load scenario- High Nuclear Power

Fig.17 Power-supply costs under different carbon-peak paths

According to the data above, with the improvement of technology, the power generation cost of PV and wind power decreases year by year, while the output of highcarbon energy is limited, which leads to an increase in the cost of kWh, and causes an increase in the cost of power supply.From the perspective of different carbon-peak paths, owing to the relatively low cost of nuclear power per kWh and reduced power demand from external channels,the power-supply cost will be further reduced after the commissioning of nuclear power units in 2030, which will be 7.8% (base load scenario) lower than the power supply cost of “new energy + channel” plan by 2035.Under the high load scenario, more energy demand leads to a further increase of incoming power demand under the “new energy + channel” scheme.Then the power-supply cost of the scheme is further increased.In this scenario, the powersupply cost of the “new energy + channel” scheme in 2035 is 11.6% higher than that of the “high nuclear power” scheme.

(2) Transmission and distribution cost (CS)

According to the prediction curve formed by the relationship between regional historical transmission and distribution network investment and new energy permeability, and the operation and maintenance cost rate permitted by the transmission and distribution approval method, the investment and operation and maintenance cost scale of regional transmission and distribution network before 2035 can be obtained.The transmission and distribution cost of regional power systems are calculated using Eqs.(4-5), and the results are shown in Table 5.

Table 5 Transmission and distribution cost of a regional power system under different carbon-peak paths Unit: RMB/kWh

Base load N+C 0.1344 0.1372 0.1675 0.1883 H-NPS 0.1344 0.1376 0.1522 0.1640 High load N+C 0.1344 0.1372 0.1787 0.1930 H-NPS 0.1344 0.1376 0.1523 0.1616images/BZ_43_1284_624_2268_693.png

It can be concluded from the data in Table 7 that with the increasing penetration ratio of new energy sources in the power system, the transmission and distribution cost increases yearly.From the perspective of different carbonpeak paths, the transmission and distribution cost of the “high nuclear power” scheme is approximately 10% (base load scenario) lower than that of the “new energy + channel”scheme because the proportion of new energy is lower than that of the “new energy + channel” scheme, and the demand for power grid strengthening and external channels is relatively low.The greater the load demand, the greater the difference.In the high-scenario scenario, the difference reached 16%.

(3) Regulation cost (CB)

The regulation cost includes the life-cycle kWh cost of investment in the construction and operation of energy storage systems and pumped storage power stations.The adjustment cost is calculated using Eqs.(6-7) and economic benefit calculation software; the results are shown in Table 6.

Table 6 Regulation cost of a regional power system under different carbon-peak paths Unit: RMB/kWh

Base load N+C 0.0049 0.0029 0.0021 H-NPS 0.0057 0.0031 0.0019 High load N+C 0.0059 0.0022 0.0025 H-NPS 0.0059 0.0031 0.0023images/BZ_43_1284_2290_2268_2359.png

According to the data in Table 8, the adjustment costs of the “new energy + channel” plan and the “high nuclear power” plan are basically the same.In a high-load scenario,more adjustment capabilities are required than in a base load scenario, resulting in higher adjustment costs.

(4) System power-supply cost (C)

The system cost of the power system in this region until 2035 can be calculated using Eq.(8), as shown in Table 7.

Table 7 Power supply cost of a regional power system under different carbon-peak paths Unit: RMB /kWh

Scene Path 2020 2025 2030 2035 Base load N+C 0.5099 0.5284 0.5529 0.5756 H-NPS 0.5099 0.5295 0.5214 0.5210 High load N+C 0.5099 0.5293 0.5745 0.5926 H-NPS 0.5099 0.5293 0.5212 0.5151

According to the data in Table 7, for the base load scenario, the kWh cost of the power system in this region increases yearly under the “new energy + channel” scheme.In 2035, the kWh cost of the power system in this region will increase by 12.88% compared to that in 2020.Higher system costs are not offset by the falling PV and wind costs.Under the “high nuclear power” plan, with the installation of nuclear power in 2030, the kWh cost of the power system will start to decrease.In 2035, the kWh cost of the power system in this region will increase by 2.18% with respect to that in 2020, and will be 9.49% lower than that in the “new energy + channel” plan.The high scenario follows this trend, but the kWh cost of the power system in the “high nuclear power” plan slightly decreases compared with the base load scenario; However, the kWh cost of the power system under the scheme of “new energy + channel” plan has a pull up of about 3%, which is highly sensitive to load changes.

In conclusion, the “new energy + channel” and “high nuclear power” schemes were compared and analyzed in terms of three aspects: economy, supply security, and carbon target, as shown in Fig.18 and Fig.19.

Fig.18 Comparison of carbon-peak path schemes-base load scenario

Fig.19 Comparison of carbon-peak path schemes-high load scenario

In contrast, the peak carbon emission and power system supply cost of the “high nuclear power” scheme in this region are better than those of the “new energy + channel”scheme.However, the “high nuclear power” scheme is greatly dependent on policies constraints, it is also restricted by the long construction and production cycles of nuclear power.With the clear goal of having carbon peak before 2030 and achieving carbon neutrality before 2060, more invisible costs such as planning, coordination, and overall construction are ought to be considered to ensure the onschedule operation of nuclear power and realize the carbon target within the predetermined period.Although the “new energy + channel” scheme has a slightly higher kWh cost,its construction and operation cycle is shorter and the policy support is stronger.This will guarantee the timely realization of the carbon target with a smaller overall planning cost.Therefore, the “nuclear power” scheme is suitable for regions with existing nuclear power reserves, while the“new energy + channel” scheme is suitable for regions without nuclear power reserves and relatively sufficient new energy resources.On the other hand, the kWh cost of the power system under the “new energy + channel” scheme is sensitive to load changes.A higher load demand will significantly increase the system cost of the scheme, which will have an adverse impact on the sustainable development of new energy.

4 Conclusions

With the goal of “carbon peak by 2030” becoming the consensus and the strict constraint of the subsequent planning and development of the energy system, apart from establishing the energy development path at the national level, the regional energy development path is also required to be coordinated to ensure the realization of the overall emission peak target from bottom to top.Therefore, it is vitally important to develop the emission peak path and cost analysis methods for power grids at regional or provincial level.From the perspective of the life cycle, this study provides a power supply cost calculation model of the regional power system under the carbon peak target.This method can effectively calculate the power-supply cost of the entire link of regional power systems under different carbon-peak paths, and can be used to determine the economy of carbon peak paths to provide a scientific basis for the choice of carbon-peak paths and the formulation of policies.

The example results show that with the increase in new energy permeability, the transmission and distribution cost of the system increases significantly.The plan of“high nuclear power” is better than that of “new energy +channel” in terms of carbon emission reduction capacity and economic efficiency, but the policy binding force of nuclear power construction is strict and has some uncertainty.Therefore, to ensure the realization of the goal of carbon peak, power systems in different regions are suggested to choose the path of carbon peak according to the characteristics of regional energy resources and project reserves, combined with a comprehensive analysis of the system cost.

At the same time, to realize the goal of carbon peak while promoting the improvement of low carbon energy technology and reducing the decarbonization cost, it is necessary to make every effort to improve the energy efficiency of the whole society, to build an energy utilization management system, and to promote the efficient use of energy in the whole society.Also, to establish a complete carbon-peak policy support system, it needs to improve the transmission and distribution cost monitoring system.By reasonably allocating the power grid construction and operation cost, promoting the reform of electricity prices,improving the trading mechanism, and gradually restoring the commodity attribute of electricity, it will perfectly ensure the economy of low-carbon transformation of power systems and promote the sustainable development of decarbonization.

Acknowledgements

This work was supported by National Key R&D Program of China (2018YFB0905000).

Declaration of Competing Interest

We declare that we have no conflict of interest.