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Power System Management
EECS 4460/5460-901

Lecture #11

Power Generation Alternatives – FUEL

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Is Historical Volatility in our Past?
(Indexed 1970-2010)

1 Prices are not adjusted for inflation. See “Nominal Dollars” in Glossary.
2 Wood and wood-derived fuels, and biomass waste; excludes fuel ethanol and biodiesel.
Prior to 2001, also includes non-biomass waste.
3 Based on nominal dollars.
4 Liquefied petroleum gases.

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Nuclear Fossil Steam
(Coal) Gas Turbine Renewables

2009 5.35 32.30 51.93 0

2019 6.81 24.28 23.11 0

Fuel Costs: Simple Summary
Average Costs in $/MWHr
EIA Electric Power Annual – October 2020

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Receipts
(Mtons) Cost
($/MMBtu) Receipts (Kbarrels) Cost
($/MMBtu) Receipts
(M Mcf) Cost ($/MMBtu)

2009 981 2.21 88,951 7.02 8,119 4.74

2019 560 2.02 24,556 9.07 11,693 2.89

Fossil Fuel Deliveries and Costs
EIA Electric Power Annual – October 2020
Coal
Petroleum
Natural Gas

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Natural Gas Now Competitive with Coal

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With Regional Variations

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Recent Gas Fired Generation by Region

Anthracite
86-97% carbon; .6-.8% sulfur (by weight)
Highest heating value (used by metals industry); 15000 BTU/lb
Less than 1% of U.S coal production – Northeastern PA.

Bituminous
45-86% carbon; 2-4% sulfur (by weight)
Most abundant in U.S.;100-300Million Years; 11000 BTU/lb
About 46% of all U.S. coal production – 74% from WV, IL, PA, KY, IN

Subbituminous
35-46% carbon; <2% sulfur (by weight) Lower heating value than bituminous; 8500 BTU/lb About 45% of all U.S. coal production – 89% from WY Lignite 25-35% carbon; .4-1.0% sulfur (by weight) Lowest Heating Value; 5900 BTU/lb 9% of all U.S. coal production – 50% from TX, 43% ND ND facility to convert to synthetic natural gas Types of Coal 8 Coal as a Resource is Regional Appalachia – 26% 78% Underground WV largest Interior – 19% 56% Underground IL largest Western – 56% 91% Surface WY largest @73% 9 Overall Coal Production Declining 10 Coal Volumes for Power Generation Declining as Well 11 Coal Prices Continue to Fall 12 Coal-fired generation continues to decline Pandemic impacted coal generation With coal plant retirements continuing Natural Gas Geology 16 Natural Gas Production and Delivery 17 Gas Transmission Network 18 Associated Production Trend Pre-Pandemic Natural Gas dry production is also regional 20 Shale Production “Expansion” 21 Marcellus and Utica 22 Fracking Simplified High pressure stream of water, sand and chemical injected Mixture velocity dislodges rock, releasing gas to the surface Worldwide, belief is trillions of shale gas could be released 23 Issues with Shale Gas Fracking Improvement of U.S. Energy Security Positive regional economic effect Health effects?? Increased truck traffic/on-site diesel generators Seismic activity risk Ground water quality concerns Management of wastewater (recycle/injection) Banned in NY, VT and MD; France, Germany and others Financial business model for shale companies 24 Earthquake Trends and Wastewater Injection from Shale Wells 25 Shale Efficiencies are Improving Production and Consumption Trend 27 Production and Consumption 28 Global oil supply has exceeded demand March 2020: Saudi Arabia cuts price in dispute with Russia Resulted from proposals to cut production amid the pandemic Results in 65% quarterly fall in price U.S. prices fall 34 %, crude price by 26% April 2020: U.S. futures fall below zero for the first time WTI crude for June delivery fell to $11.95/bbl Output reduced April 2020: Deal reached to cut output by about 10% Week-long negotiations between OPEC and the group of 20 Nations May 2020: U.S. shale oil producers cut output dramatically Further reductions expected Oil prices “rally” to $40/bbl – sustainable? Market rebalancing or “plaster on an open wound”? Winter 2021 cold spell boosts prices to $60/bbl COVID-19: Energy Markets Impacted IEA Oil Recovery Forecast International Energy Agency - April 27, 2020 Gas futures initially rose slightly in response to oil March 10: January 2021 forwards up to $2.69/MMBtu Anticipated slowdown in associated gas drilling will trim inventory Demand still largely weather-driven Price “recovered” down to pre-COVID levels, $1.60-$1.80/MMBtu, Winter 2021 cold spell sees regional price spikes LNG deals have been impacted Structural challenges existed before the pandemic Some contract cancellations from “force majeure” clauses Exports down due to COVID but recovering Natural Gas Markets are Less Impacted Natural Gas Price History (1975-2012) 32 Remember the Big Picture… With forecasted consumption increasing Source: EIA AnnualOutlook 2021 Nuclear Fuel Cycle 35 Mined Uranium is Concentrated by Milling 36 Enrichment is Next 37 5% Enrichment Limit for Commercial Nuclear 38 Fabrication is the Final Step 39 Fabricated Fuel Assemblies 40 The “Saga” of Yucca Mountain 1982 – Congress passes Nuclear Waste Policy Requiring two repositories 1986 – Three sites are selected: Hanford WA, Deaf County TX and Yucca Mt. NV 1987 – Congress amends the Act and selects Yucca Mt. 1994 – Excavation and tunneling begins 1998 – DOE fails to meet deadline for accepting waste 2000 – New Guidelines are issued and NV files lawsuit 2008 – DOE submits license for NRC approval 2015 – NRC issued Safety Evaluation Report Concept: The Federal Government is responsible for high level nuclear waste through DOE 41 Yucca Mountain Recently … 2016 – Exploratory work halted; site abandoned. 2018 – “Revival’ bill approved by Congress with provisions for temporary storage. NV Governor vows to oppose. 2021 – Biden administration announces opposition Meanwhile, 77,000 metric tons of spent fuel is currently being safely stored at 121 locations across 39 states. By the way, more than 160 million Americans live within 75 miles of those sites. Yucca Mt. is about 100 miles northwest of Las Vegas, next to the Nevada Test Site 42 Spent Fuel: Dry Cask Storage Spent Nuclear Fuel is Currently being Stored at the Plants in Dry Storage Casks – Concrete or Steel 2-6 Dozen Fuel Assemblies per Cask Filled with Inert Gas and Sealed 43 Spent Fuel Storage 44 Long Term Trend: Import Uranium Supply 45 Global Uranium Market 46 Nuclear Fuel Cost is Driven by Uranium Supply $29.50 Feb. 2021 47 One uranium fuel pellet creates energy equivalent to one ton of coal, 149 gallons of oil or 17,000 cubic feet of natural gas. An 1110MW PWR has 193 fuel assemblies, over 50,000 fuel rods and some 18 million fuel pellets A single fuel assembly spends about 5-6 years in a reactor A reactor is “refueled” about every two years - about 1/3 of the fuel is replaced and the remainder “reshuffled” Why nuclear fuel costs ($/MWhr) are low 48 Power System and the Environment Next: