Does the Electricity Sector in 2050 Belong to Solar Power? A Case Study on Portugal
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Examensarbete för masterexamen
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Southern European countries, such as Portugal, can successfully use solar power
to meet their climate targets given their favorable exposure to insolation. Solar
power is a variable renewable energy source (VRES). Consequently, other electricity
generation sources and energy storage technologies become important to work in
harmony with solar power to ensure a resilient electricity system.
This thesis considers the year 2050 and Portugal as basis of its assumptions. Further,
it uses a green-field investment model to outline which uncertainties are associated
with solar becoming the major source of energy in the electricity sector in 2050.
Additionally, it investigates how solar power being the major electricity supplier in
the electricity sector influences the system Levelized Cost of Electricity (LCOE). An
extensive sensitivity analysis, by performing a Monte Carlo analysis, evaluates different
uncertainties correlated with different technologies’ development: investment
and fuel costs. Also different scenarios are studied to better understand how different
uncertainties impact the optimal share of solar power. These scenarios include
expensive battery storage, carbon capture and storage (CCS) technologies, and an
addition of hydrogen demand.
The results show that solar power, despite of being primarily influenced by the solar
power investment cost, is also impacted by the investment cost of battery storage.
When battery storage investment costs is, on average, lower than 91 EUR/KWh, solar
power becomes the major electricity generation source of the electricity sector when
the solar power investment cost is lower than 650 kEUR/MW. Still, at times when the
demand cannot be met by only solar power and the excess energy stored in batteries,
wind power, CCS technologies, and biogas power plants become important. Nuclear
power becomes extremely important at times when solar power is frequently complemented.
The system LCOE, from decreasing the solar power investment cost from
800 kEUR/MW to 200 kEUR/MW is reduced by 24%, reaching a lowest of 48 EUR/MWh.
CCS technologies promote an increase in system LCOE by 4 EUR/MWh, while adding
a demand for hydrogen lowers system LCOE by 2 EUR/MWh.
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Ämne/nyckelord
Carbon Capture and Storage (CCS), Expensive Battery Storage, Hydrogen Demand, Monte Carlo Analysis, System Levelized Cost of Electricity (LCOE)