The U.S. Power Sector Decarbonization: Investigating Technology Options with MARKAL Modeling 36th USAEE/IAEE Conference Sept 23-26, 2018 Chris Nichols Energy Markets Analysis Team

Overview Using the MARKAL 9-region model, we projected a variety of scenarios out to 2050 to examine the impacts of CO2 reduction strategies and CCS R&D Conclusions: There are inconsistencies between the near-term CO2 reduction strategies and long-term (COP 21) mitigation ambitions. Deep decarbonization stimulates end-use electrification and higher dependence on CO2 management in the power sector. 80% CO2 reductions are achievable in the model, but only with very high prices. Delay in decarbonization might render the goal unachievable. CCS significantly lowers the cost of ambitious decarbonization pathways

Scenarios

CO2 emissions – historical and projected Between 2007 and 2016, CO2 emissions fell by 14%; decomposition analysis shows that the largest CO2 reduction was due to decreased consumption during 2007–2009 recession. In the 80% reduction case, emissions go down to levels around those of the 1930’s

Marginal CO2 Emissions Abatement Costs in Power Sector Marginal abatement cost (MAC) curve shows the cost of the last abated unit of energy system CO2 for a defined abatement level In the 80% CO2 reduction scenario without CCS R&D goals the U.S. power sector can abate about 14 GtCO2 at extremely high long-term CO2 prices that reach $800/tCO2 by 2050 CO2 reduction in all other scenarios (with or without CCS R&D goals) are up to 14–16 GtCO2 abatement.

Electricity generation - Reference Case without and with DOE R&D Move to natural gas, some deployment of CCS in R&D scenario related to CO2 EOR

Electricity generation – High Gas Price without and with DOE R&D Renewables displace gas and more CCS deploys in the R&D case for EOR

Electricity generation – $50/mt CO2 & 5% increase without and with DOE R&D CCS on NG and biomass with more renewables in the without R&D case – larger shift to CCS in the R&D case

Electricity generation – 80% reduction case without and with DOE R&D Increase in electricity generation with other sector electricification; substantial CCS deployment in R&D cases

Conclusions The viability of deep decarbonization by 2050, if the U.S. follows current trends through 2025, is in question - with an important inflection point around 2030 Decarbonization in the power sector alone is insufficient to meet economy-wide goals consistent with COP-21, so increasing the deployment of low-emission or emissions-free vehicles is a crucial part of meeting climate change targets CCS plays a vital role in deep reduction strategies, lowering the marginal abatement cost and providing further reductions in emissions Link to the full paper: https://www.sciencedirect.com/science/article/pii/S0140988318301026