1. Fuel Diversity for Electric Power Generation in New England
David L. O’Connor
Commissioner
Massachusetts Division of Energy Resources
Electric Restructuring Roundtable
April 12, 2002
T:p-info/presentations/renewables and energy efficiency/fuel diversity041202

2. How to Evaluate Fuel Diversity in N.E.?
How does fuel use in N.E. compare to U.S?
What are recent trends in N.E. fuel use?
How should we measure fuel diversity?
What do forecasts show?
What public policies might influence fuel diversity?

3. Capability to Burn Natural Gas Increased
U.S. Installed Capacity
Capability to Burn Natural Gas Increased
Source: EIA Annual Energy Review

4. New England Installed Capacity
Capability to Burn Natural Gas Increased
Source: ISO-NE Celt Report, DOER

5. Nuclear and Coal Plants Are Used the Most
U.S. Capacity Factors
Nuclear and Coal Plants Are Used the Most
Nuclear
Coal
Gas
Petro

6. New England Capacity Factors
Nuclear and Coal Plants Are Used the Most
Nuclear
Coal
Gas
Petro

7. Natural Gas Use Increased, Others Decreased
U.S. Generation
Natural Gas Use Increased, Others Decreased
Source: EIA Power Annual

8. New England Generation
Natural Gas and Renewables Use Increased,
Nuclear and Oil Use Decreased
Source: EIA Power Annual

9. Concentration of Fuels Used for Generation
2000
Source: EIA Power Annual, DOER

10. Fuel Diversity in New England
Generation from new gas plants has increased fuel diversity in N.E.
Increased gas use matches development of nearby gas supplies and new pipelines.
Capacity exists for greater use of several fuels in response to fuel price changes.

11. Fuel Diversity Policy Considerations
Reliability
Security
Price Level
Price Volatility
Environmental Impacts
Impacts on Other Sectors

12. Tradeoffs Among Three Fuels
Coal
Lower, stable price
Very reliable supply
Greater environmental impacts
Natural Gas
Sometimes volatile price
Generally reliable supply
Modest environmental impacts
Renewables
Higher but stable price
Less reliable supply
Lesser environmental impacts

13. New England Generation in 2005
Nuclear and Oil Use Varies with Fuel Prices,
Gas Use Increases Regardless
Source: EIA Annual Energy Outlook 2002
Source: DOER Energy 2020 Forecast

14. Concentration Ratios EIA Base Forecast
2005
Source: EIA Power Annual, DOER

15. New England Generation in 2010
Natural Gas at 43% Under Two Scenarios
Source: EIA Annual Energy Outlook 2002
Source: DOER Energy 2020 Forecast

16. Concentration Ratios EIA Base Forecast
2010
Source: EIA Power Annual, DOER

17. Public Policies That Might Influence Fuel Diversity
Air & water regulations for coal & oil plants
Changes in ISO-NE rules for plant dispatch
Maintenance of duel-fuel infrastructure
Renewable Portfolio Standards
Energy efficiency, demand response and distributed generation