Wind Energy in NZ Presentation to The Energy Economics Summer School

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Wind Energy in NZ Presentation to The Energy Economics Summer School
Wind Energy in NZ
       Presentation to The Energy
       Economics Summer School

Grenville Gaskell, NZ Wind Energy Association
February 2021
Wind Energy in NZ Presentation to The Energy Economics Summer School
Contents
>   About NZWEA
>   A Historical Perspective
>   Advantages of Wind Power
>   National Trends
>   Environmental Impacts
>   An Operational View
>   Climate Change Imperative
>   Domestic and Commercial Wind
    Turbines
>   Summary
Wind Energy in NZ Presentation to The Energy Economics Summer School
About NZWEA
▪       Established 1997
▪       An industry association
        ▪   Promotes the development of wind as a reliable,
            sustainable, clean and commercially viable energy
            source
        ▪   Policy & regulatory advocacy, public awareness and
            industry development
    ▪       Represents around 50 companies:
        ▪   Generators and developers
        ▪   Turbine manufacturers, equipment suppliers, consultants
▪       Utility and community scale generation
Wind Energy in NZ Presentation to The Energy Economics Summer School
Wind Energy in Perspective
▪   Internationally
    ▪   500 to 900 A.D - used for pumping water
    ▪   1890’s - pumping water and electricity
    ▪   1980’s - first large scale wind farms
    ▪   1991 - first off shore wind farm
    ▪   2002 - first 3MW wind turbine
    ▪   2020 - Offshore wind 12MW turbine
▪   New Zealand
    ▪   1970’s - research commenced
    ▪   1980’s - recognition of commercial opportunities
    ▪   1990’s - first turbines and commercial deployment
    ▪   2004 - first grid connected wind farm (Te Apiti)
    ▪   2020 - first coastal wind farm (Waipipi)
Wind Energy in NZ Presentation to The Energy Economics Summer School
Why Wind?
▪   Renewable - produces no greenhouse gases
                                  Tonnes C02-e per GWh
          Coal                              1000
          Gas                               455
          Geothermal                        115

▪   Low investigation costs
▪   Cheapest form of new generation and scalable
▪   Consistent resource
    ▪   Short term variability but seasonally reliable
    ▪   Spatial diversity smooths output
▪   Synergies with hydro generation
▪   The renewable that best fits NZ’s demand profile
Wind Energy in NZ Presentation to The Energy Economics Summer School
The declining cost of renewables

Lazard LCOE version 12.0
Wind Energy in NZ Presentation to The Energy Economics Summer School
14.04.2021

 Improving performance

                                                          3.3 MW                                                                            NEW
                              3.0 MW                                                   3.45 MW             3.45/4.2 MW
                                                                                                                                           in 2017
                                                                                                           • New rotor: 150 m
                                                                                                           • New segment: IEC T-class   4.2MW &
                                                   • Upgrade to 3.3 MW nominal      • Upgrade to 3.45 MW   • Up to 4.2 MW Power
  Wind                   • First Vestas 3 MW WTG     rating                           nominal rating         Optimised Mode             150 Rotor
                                                   • New rotors: 105m, 117m, 126m   • New rotor: 136 m     • Platform naming: 4MW
                                                                                    • Up to 3.6 MW Power
                                                                                      Optimised Mode
  Tropical/strong wind
                                                                                                                                                      Double digit
                                                                                                             V117-4.2 MW™                              AEP gains
                                                                                                                                                      across wind
  High Wind                 V90-3.0 MW™                 V105-3.3 MW™                 V105-3.45 MW™           V105-3.45 MW™                              classes

                                                                                     V112-3.45 MW™           V112-3.45 MW™
                                                        V112-3.3 MW™                                         V117-3.45 MW™
  Medium Wind              V112-3.0 MW™                                              V117-3.45 MW™
                                                                                                             V126-3.45 MW™
                                                        V117-3.3 MW™
                                                                                     V126-3.45 MW™           V136-3.45 MW™              Up to
  Low wind
                                                        V126-3.3 MW™                 V136-3.45 MW™           V136-4.2 MW™               56%
                                                                                                             V150-4.2 MW™                 AEP
                                                                                                                                        increase
  Year of Announcement          2010                      2012/13                          2015                    2017                 since 2010*

  1
Wind Energy in NZ Presentation to The Energy Economics Summer School
NZ Demand Context
▪   NZ demand profile is winter peaking
▪   All renewables positive but wind matches daily
    and seasonal demand bests
▪   Spatial diversity key to
    managing wind’s variability
▪   Significant hydro variability
▪   Transpower on wind ”a low cost source with
    stronger alignment with winter peaks”
▪   On solar “ produces the least energy when NZ
    needs it most such as during cold, dark winter
    months”
Wind Energy in NZ Presentation to The Energy Economics Summer School
9

        Intermittency

    New Zealand power system 2050
Wind Energy in NZ Presentation to The Energy Economics Summer School
Mostly, We Like Wind but…
                ▪   76% of support for wind
                    (EECA survey 2011)

                ▪   Increasing number of
                    community wind
                    initiatives
                ▪   Visual impacts and
                    noise the main issues
                ▪   Challenge is for
                    developers and
                    operators to be good
                    neighbours
Electricity Generation in NZ
Generation stages:
▪     1900 - 80’s hydro
▪     1970’s - 2000’s thermal
▪     1990’s - 2020 geothermal
▪     2000’s - 2050 wind & solar
▪     Offshore wind?
Key challenges managing
variability and dry year risk

    ICCC Accelerated Electrification Report (April 2019), – “modelling
    suggests wind will be the dominant form of new renewable
    generation out to 2035”
Trends in NZ
•   Historic generation trends now in decline
•   Price of natural gas and carbon is accelerating the case
    for the long-term substitution of baseload thermal plant
•   New role firming wind & hydro as renewables increase
•   Renewables are increasing
    - Around 85% now
    - Potentially 90%+ 2035
•   Thermal plant closures in 2015
    - Otahuhu 400MW
    - Southdown 130MW
•   Future of TCC and Huntly?
•   Hydro moving more to support
    other renewables
NZ - Wind Generation Today

                  ▪   19 wind farms, 2 under
                      construction
                  ▪   690 MW generating capacity
                  ▪   Around 5% of NZ’s annual
                      generation
                  ▪   2000MW consented
                  ▪   Consent challenges with
                      new technology
                  ▪   Unlikely all will be built
Vision: Wind Energy 20% by 2035
 ▪   20% wind energy
     ▪   NZ has an exceptional resource
     ▪   Fits with the existing electricity system
     ▪   Will deliver economic benefits
     ▪   Wind can replace the majority of NZ’s gas – fired
         baseload generation
     ▪   Lowest long run marginal cost
     ▪   Generation profile enhances actual revenue earned
 ▪   Target 690 MW to 3,100 MW by 2035
     ▪   Requires around 150MW / $300m investment p.a
 ▪   Transpower wind forecast – 2,900 MW
     (2035), 6,500 MW (2050)
2019 the restart of growth…
▪   Improved outlook with decarbonisation
    ▪   Electrification plus thermal displacement
▪   355 MW committed in 2019
    ▪   Waipipi 133 MW / $276m
    ▪   Turitea 222 MW / $464m
    ▪   On average powers 182k homes, 580k EV’s
    ▪   Increase wind from 5% to 7.6% of total generation
▪   Potential
    ▪   Mt Cass 93 MW / $200m
    ▪   Harapaki (Hawkes Bay) 160 MW / $330m
    ▪   Kaimai 100 MW / Omamari 73 MW
    ▪   Repowering Tararua 72 MW
Environmental Impacts
▪   RMA key to the sustainable management
    natural and physical resources
▪   Construction Phase
    ▪   Earthworks
    ▪   Visual
    ▪   Noise
    ▪   Ecology
    ▪   Transportation / traffic effects
▪   Operation Maintenance Effects
    ▪   Visual and Landscape
    ▪   Noise
    ▪   Ecology
    ▪   Productive land
RMA Challenges and
        Opportunities
▪       Balancing perspectives
▪       Every site is different
▪       Stakeholder management
▪       Time and Cost
▪       Consistency of interpretation
        ▪   Amenity impacts - noise and visual
        ▪   National Policy Statement for Renewable Energy
            Generation
▪       Key opportunities
    ▪       New resource management system being developed
    ▪       Need to recognise climate change imperative
    ▪       Consenting process which recognise scale and impact
Operational Challenges

▪       Health and safety
▪       Wind speed
▪       Maintenance windows
▪       Market and rules
▪       Landowner and stakeholder management
▪       Ensuring compliance with consents
▪       Changing regulatory environment impacting
        investment decisions
    ▪    Transmission / distribution pricing
The Climate Imperative
▪   NZ net emissions increased 57% since 1990
▪   Increase due to agriculture, transport and forest
    harvesting
▪   Energy sector only 40% renewable
▪   Opportunity in transport and industrial processes
▪   Zero Carbon Act target net zero by 2050
▪   CCC advice - current Paris NDC target of 30% below
    2005 by 2030 not compatible with global efforts
▪   On current projections NDC shortfall 100 Mt Co2-e
▪   Shortfall to 1.5 degrees another 100 Mt Co2-e
▪   Potential cost without savings at $50/t = $10B / $20B
▪   Domestic reduction focus but offshore mitigation
    required
Highlighting the Opportunity

 •   Limited opportunity in the electricity sector
 •   Accelerated electrification needs to be renewable
CCC Draft Report…

▪   Transformational change
    required
▪   Proposed budgets are
    achievable, affordable and
    socially acceptable
▪   Accelerate EV’s
▪   Process heat conversions
▪   Phase out fossil fuel
    baseload generation
▪   Increase renewable
    generation
▪   Target 60% renewable energy by 2035 (40% today)
Domestic Wind
▪   Several types
    ▪   horizontal – as per most windfarms
    ▪   Vertical
    ▪   Generally 5 kW or smaller
▪   Cost around $10k + per kW
▪   Difficult in urban areas
    ▪   Wind turbulent, weak and erratic
▪   Require speed of 4.5m/second
▪   Tower mounting improves performance
▪   Best for rural areas with consistent wind speed
▪   Community wind has possibilities
Domestic Wind
▪   Several types
    ▪   horizontal – as per most windfarms
    ▪   Vertical
    ▪   Generally 5 kW or smaller
▪   Cost around $10k + per kW
▪   Difficult in urban areas
    ▪   Wind turbulent, weak and erratic
▪   Require speed of 4.5m/second
▪   Tower mounting improves performance
▪   Best for rural areas with consistent wind speed
▪   Community wind has possibilities
A Way Forward
▪       Wind is a key technology to enable decarbonisation
▪       Big wind with spatial planning to improve variability
▪       Enable community and industrial solutions
    ▪    Integrated with other technologies – solar and batteries
    ▪    Promotes regional growth and support for wind
    ▪    Utilises NZ’s abundant resource
▪       Potential of using wind to create green hydrogen
▪       Requires a change to planning instruments
▪       Scale of growth needs to be recognised
    ▪    0.6 GW to around 6.0 GW by 2050
    ▪    Site selection and consenting a priority
    ▪    Training resources to develop and operate new windfarms
Wind is Now…

From a science experiment
25 years ago wind offers an
amazing opportunity
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