Exploring the future low-carbon electricity system: impacts of nuclear power and demand patterns

Licentiate thesis, 2021

To achieve the climate goals set by the Paris Agreement, the global electricity system is expected to transition towards a low-carbon electricity system. The future low-carbon electricity system is uncertain regarding both generation and demand. First, the cost of variable renewable energy (VRE) technologies, such as wind and solar, has been decreasing over the past decade and the share of  VRE in the electricity system is increasing. This trend is likely to continue for the foreseeable future. However, there is no consensus as to whether the goal of deep decarbonization of the electricity system can be accomplished without large cost escalation if nuclear power and fossil fuel plus carbon capture and storage (CCS) are excluded. Second, the future electricity demand is highly uncertain due to economic growth, e-mobility, electric heating, electric cooling, etc. These factors affect not only the volume of annual electricity demand, but also the inter-temporal electricity demand pattern. The change in demand pattern may affect a low-carbon electricity system with a high penetration level of wind and solar, as such a system is less capable of load following, as compared with the conventional electricity system based on dispatchable thermal power plants.

This thesis investigates the impacts of nuclear power and demand patterns on the future low-carbon electricity system, and addresses the following research questions: What is the cost of a future low-carbon electricity system without nuclear power for Sweden?; and How will the electricity demand pattern affect the electricity system cost and the electricity supply mix? A greenfield techno-economic cost optimization model with a high temporal resolution for the electricity system is developed and used to answer these questions.

The results of this work reveal that including nuclear power in the electricity system reduces the nodal net average system cost by 4% for Sweden. This implies that the economic rationale for Sweden as a country to invest in nuclear power is limited if there is a transition towards a low-carbon electricity system in Europe. In addition, we find that varied electricity demand patterns (seasonal and diurnal variations) affect only slightly the electricity system cost, except for the case of summer peak, where the system cost may increase by up to 8%. The demand pattern may have a stronger impact on the electricity supply mix, especially solar and storage capacities, than on the electricity system cost.

This thesis contributes to a better understanding of the potential future low-carbon electricity system. The results are beneficial in identifying the implications for the planning of the future electricity system, policy support for low-carbon technologies, and demand profile treatment for modeling studies.