1. International Energy Workshop (IEW)
International Institute for Applied Systems Analysis (IIASA)
June , 2003
Evaluations of R&D Strategy for Advanced Combined Cycle Power Systems in Japan with an MIP model based on GERT
Keigo Akimoto, Ayami Hayashi,
Takanobu Kosugi, Toshimasa Tomoda
Research Institute of Innovative Technology for the Earth (RITE), JAPAN

2. Contents 1. Outline of the study 2. Model framework
3. Development processes of new power generation technologies expressed by GERT networks
4. Model formulations with explicit expression of technology development processes
5. Model assumptions
6. Simulation results
7. Conclusion

3. Outline of the Study
<Objectives> Optimization of power expansion planning of Japan including the R&D expenditures for new technologies
Development of a new mixed integer programming (MIP) model, taking into account both technology developments and their practical use
Explicit modeling of development processes based on GERT (Graphical Evaluation and Review Technique)
Optimization of power expansion planning and revelation of spillover effects of elemental technologies* by model analysis results
* Power generation technologies are broken down into many elemental technologies in the model.

4. Model Framework
Technologies to be evaluated: Electric power technologies
Conventional coal fired (37 %-HHV)
IGCC (43, 48, 50, 55 %)
IG-MCFC-CC (55 %)
IG-SOFC-CC (60 %)
Conventional LNG fueled (43 %)
LNG combined cycle (49%)
Advanced LNG combined cycle (55, 60 %)
LNG-MCFC-CC (60 %)
LNG-SOFC-CC (65 %)
Conventional oil fired (35 %)
Wind power
Photovoltaics
Nuclear power
Hydro & geothermal
Electricity storage (pumping-up)
* The R&D processes of the red colored technologies are explicitly modeled by GERT.

5. Model Framework (contd.)
Time span:
Exogenous scenario of electricity demand
Optimization of total investment on technology development and practical use in electric power sectors of Japan under the constraint of electricity demand satisfaction
From 2000 to 2050, representative time points: 25
Load duration is expressed by the four kinds of time periods:
instantaneous peak, peak, intermediate and off-peak

6. A Part of the Assumed R&D Processes

7. Model Formulations Objective function: Constraints: where
V : electricity generation (decision var.), F : capacity of installed tech. (decision var.)
I : additional expenditures for the elemental technology development (decision var.)
d : coefficient of discount (5%/yr), PV : fuel cost, PF : plant construction cost
r : annual expense rate, Eff : thermal efficiency, ED : electricity demand
SP : shadow price of electricity in a no-climate regulation case
ES : energy saving of electricity (decision var.), Loss : distribution loss of electricity
h : annual average usage rate, HOURk : hours in k-th time zone

8. Model Formulations (contd.)
Constraints (contd.):
All of the decision variables are larger than 0.
where
d : binary decision variables representing whether a technology is available or not
TMT : required years for technology development (decision var.)
TC : lead time, D t : years between t-1 -th and t-th time points
TD : required years for development of elemental tech. (decision var.)
I : additional expenditures for development of elemental tech. (decision var.)
TDbase : standard required years for development time of elemental tech.
TDmin : minimum required years for development time of elemental tech.
l : decrease in development time, M : large value of natural number (e.g.,=108)
f(x) : function for technology development time formulated by GERT logics

9. Model Assumption - Facility Cost of Power Generation -

10. Development times of elemental technologies
* Development time with additional 1.0 billion YEN (≈ 8.0 million US$) expenditures on the elemental technology

11. Development times of elemental technologies (contd.)
- Data was collected through a questionnaire to experts in Japan; the answers arrived from 27 out of 38 experts for LNG-CCs and IGCCs, and those arrived from 27 out of 33 experts for FCCCs.

12. Model Assumption - Fossil Fuel Price -
- The CIF prices of crude oil and coal are exogenously assumed by using the endogenous results by a world energy systems model, Dynamic New Earth 21 (DNE21)
- The LNG price is assumed to change in proportion to the oil price

13. Model Assumption - Electricity Demand -

14. Model Simulation
Decision variables: about 3600 including about 600 binary variables.
Constraints: about 3200
Solver: ILOG CPLEX® with the parallel MIP solver
Simulation Cases:
- Two cases of carbon reduction policies:
- Two cases of expenditures for technology development:
No-regulation Case
Regulation Case (constant emission: 85GtC/yr)
Optimum Strategy in Standard Case
Optimum Strategy with Additional Expenditures for the Elemental Technology Developments

15. Electric Power Plant Capacity in the No-emission-regulation Case for Scenario M
- Without Additional Expenditures With Additional Expenditures -
1.2 billion US2000$ reduction

16. Electric Power Plant Capacity in the Emission-regulation Case for Scenario M
- Without Additional Expenditures With Additional Expenditures -
7.9 billion US2000$ reduction

17. Optimized Additional Expenditures on Elemental Technology Developments

18. No-emission-regulation Case
Optimized Additional Expenditures on Elemental Technology Developments (contd.)
No-emission-regulation Case
Robust strategy under uncertain electricity demands
For low electricity demand (Scenario L)
For middle and high electricity demands (Scenarios M and H)
Integration technologies for IGCC-55%
Integration technologies for LNG-CC-55%
Oxide dispersion strengthened (ODS) superalloy tech. for gas turbine
blade (TIT: 1700deg.C)
Cooling structure design tech. for gas turbine blade (1700deg.C)
ODS superalloy tech. for gas turbine vane (1700deg.C)
Ceramic matrix composite tech. for gas turbine blade (1700deg.C)
Integration technologies for IGCC-48%
Integration technologies for LNG-SOFC-CC-65%
Manufacturing technologies for pressure resistant vessel of SOFC
Manufacturing technologies for gas shield vessel of SOFC

19. Emission-regulation Case
Optimized Additional Expenditures on Elemental Technology Developments (contd.)
Emission-regulation Case
For low electricity demand (Scenario L)
For middle and high electricity demands (Scenarios M and H)
Integration technologies for IGCC-55%
Integration technologies for IGCC-48%
Integration technologies for LNG-CC-55%
Oxide dispersion strengthened (ODS) superalloy tech. for gas turbine
blade (TIT: 1700deg.C)
Cooling structure design tech. for gas turbine blade (1700deg.C)
ODS superalloy tech. for gas turbine vane (1700deg.C)
Ceramic matrix composite tech. for gas turbine blade (1700deg.C)
Integration technologies for LNG-SOFC-CC-65%
Manufacturing technologies for pressure resistant vessel of SOFC
Manufacturing technologies for gas shield vessel of SOFC

20. Conclusion
A mixed integer programming model for the developments and the practical use of the technologies has been developed, in which technology development processes are explicitly modeled based on GERT.
Power expansion planning of Japan including the R&D expenditures of advanced combined cycle power systems are evaluated using the model.
The simulation results indicate that the selection of the cost-effective technologies and the concentrated investment on them are important in the case of additional expenditures for technology R&D.

22. Model Formulations (contd.)
- Calculation of Development Completion Time Based on GERT -
(1) Exclusive-OR
(2) Inclusive-OR
(3) AND
where T : completion time of node, t : required time of arc
P : success probability of node, p : success probability of arc

23. Model Formulations (contd.)
- Calculation of “min” & “max” -
(1) “min” logic
where M : large value of natural number (e.g., =108 )
(2) “max” logic

24. Outline of Technological Structure of IGCCs
Source: Hayashi et al., 2000

25. Outline of Technological Structure of Combined Cycle Systems of Fuel Cells

26. Shadow Price of Electricity without and with Additional Expenditures for Scenario M