Gaining Speed



Author: Velocity Suite Power Plant Analyst

Wind Generation and CO2 Savings in Iowa

Is coal on its way out as an energy source? It can sound like it, as utilities announce new retirements, and talk of climate change and new regulations grows. Carbon Dioxide (CO2) is a driving force in these topics. The US Environmental Protection Agency (EPA) has proposed new rules and standards to govern CO2 emissions from power plants, and many fear the impacts to coal fired power plants and the market. Many who support such new initiatives advocate power generation switching to CO2 free sources – for example, wind and solar – but is that about to happen? Here we take a look at the wind generation trend in Iowa, its impacts, and what that could mean for coal.

Wind generation is on the rise in the United States, especially in Iowa. A majority of states now generate some portion of electricity from wind.

Wind Generation Map2

Iowa leads the country with 27.7% of total energy produced in 2013 from wind sources. The only larger source of energy in the state is coal with 58.87% of total generation. Iowa led South Dakota (25.95%), Kansas (19.39%) and Idaho (16.17%) in percent of total generation from wind, and trailed only Texas (35 GW) in total wind energy generated (15.5 GW) in 2013. Wind has grown to play a major role in the electric portfolio of the state.

Between 2008 and 2013 wind generation has developed to meet a growing portion of Iowa’s energy needs. The 27% generation from wind is a 20 point increase from 2008 to 2013 in Iowa. In addition, overall generation has increased 7% over that time, indicating that the growth of wind is not due to “picking up slack” from elsewhere. Wind generation’s rise has been spurred by the large increase in capacity recently built. Between 2008 and 2013 Iowa saw over 5 GW of wind capacity added compared with a 200 MW decrease in coal capacity. This results in wind totaling almost 30% of the state’s available capacity, and as such, wind is meeting a growing portion of Iowa’s rising electricity needs.

Iowa Capacity Chart2

As wind capacity and generation grows, it has displaced energy generated from other sources, primarily fossil fuels. The decrease has affected all fossil fuels, but none as much as coal. Since 2008, generation from coal in Iowa has decreased by 7 GW, a 7 percentage point decrease of the state’s generation portfolio. However, coal is still responsible for more than 50% of the state’s total generation.
As coal generation is reduced, so too are the externalities associated with burning the fuel, specifically CO2. To determine how much CO2 has been avoided being emitted, we can construct a simple model using Iowa’s actual generation and the 2008 generation by fuel percentages. This model assumes that coal continues to make up 76% of Iowa’s generation portfolio in each of the 5 years from 2008 to 2013. From the results below we can get a picture of what the generation portfolio might have looked like.

Projected_Gen

Under this scenario, coal would generate 10 GWs more energy last year than actual, thus producing more CO2. Using this information and a weighted average heat rate for each fuel (Source: EIA 923), we can estimate the mmBtu not burned over the course of 5 years. Then, using either the observed CO2 rate (lbs/mmbtu) gathered from US EPA CEMS data or a default rate from the US EPA for each fuel we can estimate the tons of CO2 that would have been emitted under the scenario. The results of the scenario are represented in the following tables.

Avoided_Data

Each year the tons of avoided CO2 increase as the actual fuel portfolio shifts towards less generation from coal. Using observed CO2 rates results in a larger saving of CO2, as observed rates are higher than the default rates. Under the observed rates scenario, Iowa avoided 2.3 million tons of CO2 from coal in 2009 increasing each year to 10.475 million tons from coal in 2013. The total 5 year savings under this model are estimated at 29.74 million tons of CO2. Using the default rates achieves a more modest savings: only 2.37 million tons in 2009 and 10.47 million in 2013 for a 5 year total of 29.13 million tons from coal. According to a US EPA estimate, these savings are equivalent to removing between 5.1 and 5.2 million cars from the road.

As discussed earlier, Iowa generated 27% of total energy from wind last year. Capacity factors – the percent of available capacity used for generation – for wind generators have increased slightly, and as such we might expect that the state will continue to produce this level of generation from its wind resources. In light of this assumption, significant further growth in wind generation – and CO2 savings as a result – would have to be achieved through the construction of more wind capacity.

Looking at new capacity projects in a Permitted or Under Construction phase, another 1,000 MW of wind capacity over the next five years is slated to become commercially available. (An expanded search for projects that are proposed, app pending or feasibility study status additional capacity would be an additional 2,000 MW by 2018.) The additional capacity, coupled with no new fossil fuel projects in these advanced stages would lead to wind making up just over 34% of Iowa total available capacity. If the future fuel portfolio of generation holds to the current pattern we could see wind top 30-32% of the state’s total generation, and might further reduce coal’s percent of generation in the state (depending on future demand).

Iowa New Capacity Chart2

In the end, wind generation is on the rise in the state of Iowa. The percent of the states total energy produced from wind has increased 20% from 2008 to 2013, and has led to a subsequent decline of 17% of total generation from coal. We can use this data and expected additions in the next five years to estimate that wind might increase another 3-4% over the next five years given a 5% increase in capacity. Similarly we can couple generation and emissions data to estimate that over the 5 years to 2013, Iowa has reduced its CO2 footprint by between 31.7 and 33.1 million tons of CO2 based on 2008 levels. With the prospect of more wind capacity in the future Iowa could be building wind turbines that, like trees, are eating the state’s carbon footprint.

RELATED PRODUCTS

Velocity Suite >>
EV Power >>