The role The role ofooffofhydros hydroshydrosand ...epe.gov.br/sites-pt/publicacoes-dados-abertos/publicacoes... · The role The role ofooffofhydros hydroshydrosand aannddandRES RES

Empresa de Pesquisa Energética

Ministério de Minas e Energia



Luiz Augusto Barroso President

The role The role The role The role ofofofof hydroshydroshydroshydros andandandand RESRESRESRES

COP 22, COP 22, COP 22, COP 22, MarrakechMarrakechMarrakechMarrakech, , , , NovemberNovemberNovemberNovember 2016201620162016

Ricardo Gorini

Director



• Among other issues, the Brazilian NDC will aim to:

• Achieve an estimated 45% share of renewables in the energy matrix by 2030;

• Obtain at least a 66% share of hydropower in electricity generation by 2030, not

considering self-produced electricity;

• Expand the use of renewable energy sources (RES) other than hydropower in the

total energy mix to between 28% to 33% by 2030;

• In other words, the Brazilian NDC recognizes that hydropower plays an important

role to boost RES in the country

• Same philosophy of the Chilean 2050 Energy plan, for example

• This presentation will discuss why hydropower is key to leverage RES and paths

for a sustainable hydro development in the country

Background: the Brazilian NDC…Background: the Brazilian NDC…Background: the Brazilian NDC…Background: the Brazilian NDC……and the role of hydro power to boost RES penetration…and the role of hydro power to boost RES penetration…and the role of hydro power to boost RES penetration…and the role of hydro power to boost RES penetration

2



• Installed capacity of the Brazilian power system: 150,000 MW

• Hydroelectric share (91 GW): 61% of installed capacity

• Hydro plants located in several river basins with significant storage capacity

• Cascaded hydro system with multiple ownership

Hydro development in BrazilHydro development in BrazilHydro development in BrazilHydro development in Brazil

3

Owner:



HydrosHydrosHydrosHydros must must must must dealdealdealdeal withwithwithwith inflowinflowinflowinflow variabilityvariabilityvariabilityvariability

4

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Feb-0

9Apr

-09

Jun-

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-09

Oct-09

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9Fe

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Apr-1

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Feb-

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1

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Average flowsAverage flows


Ministério de Minas e Energia 5

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

Feb-

09Apr

-09

Jun-

09Aug

-09

Oct-09

Dec-0

9Fe

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Jun-

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h............andandandand inflowinflowinflowinflow uncertaintyuncertaintyuncertaintyuncertainty



How to deal with hydro inflow uncertainty?How to deal with hydro inflow uncertainty?How to deal with hydro inflow uncertainty?How to deal with hydro inflow uncertainty?

1. Portfolio effect:

diversification of basins

2. Transmission network

3. Hydro storage has a key

role: store water in wet

seasons for utilization in

the dry season (or dry

years)

6



COP 22

2016

SmallSmallSmallSmall HydroHydroHydroHydro (P ≤ 50 MW, A ≤ 3km2)

Installed Cap: 5.700 MW

Potential: 18.000 MW

A large fraction of the Brazilian

yet-to-be-developed hydro

potential is from small hydro.

Wind Power Wind Power Wind Power Wind Power Installed Cap: 10.000 MW

Potential: Above 300.000 MW

Relative newcomer technology,

but most competitive in recent

auctions.

RES have added a lot to this RES have added a lot to this RES have added a lot to this RES have added a lot to this lanscapelanscapelanscapelanscape…………

BiomassBiomassBiomassBiomassInstalled Cap: 12.900 MW

Potential: 53.000 MW

Now a days a large fraction of

the sugarcane bagasse is wasted

in low-pressure boilers.

Solar PVSolar PVSolar PVSolar PVInstalled Cap: 34 MW

Potential: No limit

A bet for the future as the

radiation indices are high all over

the country.



• RES are smaller scale projects

• Diversifies construction (and other) risks

• Smaller construction time

• Important attribute to “hedge” against load growth uncertainty

• Resource potential with geographical complementarity

• Location close to load centers

• Wide range of investors

• Local capital

• Investment (foreign) funds

A A A A portfolio of portfolio of portfolio of portfolio of hydroshydroshydroshydros and renewables combines economies of scale and flexibilityand renewables combines economies of scale and flexibilityand renewables combines economies of scale and flexibilityand renewables combines economies of scale and flexibility

And today Brazil has a renewable portfolioAnd today Brazil has a renewable portfolioAnd today Brazil has a renewable portfolioAnd today Brazil has a renewable portfolio

8



And renewables are competitive in BrazilAnd renewables are competitive in BrazilAnd renewables are competitive in BrazilAnd renewables are competitive in Brazil

Brazil: wind prices have fallen 60%60%60%60% from the Proinfa* times, wind capacity has risen 10101010----foldfoldfoldfold

9

*PROINFA was the first RES support mechanism in the country (2002) and based on a feed-in tariff (administratively set). Proinfa is now over.



ExampleExampleExampleExample: : : : windwindwindwind capacitycapacitycapacitycapacity evolutionevolutionevolutionevolution

10

• 10 GW of wind capacity operating, additional 8 GW under construction



WhyWhyWhyWhy are RES are RES are RES are RES competitivecompetitivecompetitivecompetitive in in in in BrazilBrazilBrazilBrazil????

• In most coutries worldwide, renewables require subsidies

• 120 billions in Germany, for example

• Reasons:

• Variability in energy production

• Wind + solar: ± 3 GW (15 min), ± 8 GW ( 60 min) in Germany

• Back up with thermal generation

• Difficulties to build transmission facilities

• Example: Midwest in the US

WhyWhyWhyWhy waswaswaswas itititit differentdifferentdifferentdifferent in in in in BrazilBrazilBrazilBrazil????

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IsIsIsIs thethethethe windwindwindwind productionproductionproductionproduction variabiiltyvariabiiltyvariabiiltyvariabiilty smallersmallersmallersmaller in in in in BrazilBrazilBrazilBrazil????

12

Today: 1000 MW ramp needed in 1 hour

Difference of 900 MW between forecasted and actual wind

production values

Fonte: ONS

NO



Answer: storage + transmissionAnswer: storage + transmissionAnswer: storage + transmissionAnswer: storage + transmission

• Hydro reservoirs make up for production variability of wind/solar

and seasonality of biomass

• Requires a robust transmission network, which was already build

for the hydros

• The “energy warehouses” of hydroplants were essential for the

economic feasibility of renewable energy sources in Brazil

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Bonus: production complementarity between hydro, wind, Bonus: production complementarity between hydro, wind, Bonus: production complementarity between hydro, wind, Bonus: production complementarity between hydro, wind, biomass and solarbiomass and solarbiomass and solarbiomass and solar



These complementarities have been recognized These complementarities have been recognized These complementarities have been recognized These complementarities have been recognized internationally and recently (2016) enlightened…internationally and recently (2016) enlightened…internationally and recently (2016) enlightened…internationally and recently (2016) enlightened…

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Available at: www.irena.org



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)TroubleTroubleTroubleTrouble in Paradisein Paradisein Paradisein Paradise: : : : prohibitionprohibitionprohibitionprohibition of of of of reservoirsreservoirsreservoirsreservoirs

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ToToToTo makemakemakemake thingsthingsthingsthings worseworseworseworse… … … … supersupersupersuper runrunrunrun of of of of thethethethe riverriverriverriver hydroshydroshydroshydros

• The lack of storage did not result from a technical-economical optimization of the

projects but from social-environmental constraints

• The three largest new hydro projects in Brazil – Santo Antônio, Jirau and Belo

Monte, with 18 GW of installed capacity, are run of the river plants

• This lack of storage will have important implications in the system, since the

variability of inflows to these plants is much greater than those of the existing

plants

17



ExampleExampleExampleExample: Madeira : Madeira : Madeira : Madeira riverriverriverriver hydrohydrohydrohydro plantsplantsplantsplants

0

1000

2000

3000

4000

5000

6000

7000

8000

Jan Fev Mar Abr Mai Jun Jul Ago Set Out Nov Dez

GW

h

Inflow energy in the wettest months is 7,5

times greater than the one of the driest

month

18



0

2000

4000

6000

8000

10000

12000

Jan Fev Mar Abr Mai Jun Jul Ago Set Out Nov Dez

GW

h

19

Inflow energy in the wettest months is 20

times (!) greater than the one of the driest

month

ExampleExampleExampleExample: Belo Monte : Belo Monte : Belo Monte : Belo Monte hydrohydrohydrohydro plantplantplantplant



ConsequenceConsequenceConsequenceConsequence: : : : lesslesslessless flexibilityflexibilityflexibilityflexibility + + + + thermalthermalthermalthermal dispatchdispatchdispatchdispatch

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• Perspectives of the worsening of the situation in the future:

• Wind variability in extreme events in 2016= 1 GW

• Perspective is that in 2030 the wind variability may reach 8 GW

8,000

9,000

10,000

11,000

12,000

13,000

14,000

15,000

16,000

17,000

18,000

19,000

MW

h/h

Despacho termelétrico SIN Média móvel semanal



What can be done?What can be done?What can be done?What can be done?

• Construction of cost-effective controllable (dispatchable) generation

• Current solution in the world, see the many discussions held here in Marrakech

• RES can indeed be flexible in different time intervals

• Examples include biomass, small hydros & wind, but scale is an issue

• Hydros has been in the wish-list of the international community

• Investment in storage

• Batteries to complement (back up) distributed RES production variability

• Cost of batteries is still an issue to upscale it to mainstream

• Again, hydro has been in the wish list of the international community

• Pumped storage hydros - to complement (back up) mainstream RES production variability – has been the way in many countries

21



Example: ChileExample: ChileExample: ChileExample: Chile

22



Example: USExample: USExample: USExample: US

23



Revisiting the discussion of hydro developmentRevisiting the discussion of hydro developmentRevisiting the discussion of hydro developmentRevisiting the discussion of hydro development

24

• The future of the electricity industry is towards a low-carbon matrix and RES are

key to meet this goal

• Renewable portfolios will be key to this target and hydros are RES are

complementary, not competitors, as resources towards a low-carbon Brazilian

energy matrix

• Hydro development in Brazil needs to be revisited and carried out under a

coordinated approach with the following long-term guidelines:

• Hydro development as a driving force for sustainability, inclusiveness and

social/environmental development

• Coordination between the public, private, civil society and academic sectors

to implement sustainability standards for hydro development

• Local population benefiting (economically) from the hydro development

• Communication is everything

• In other words, build the right dams, build the dams right





COP 22

2016

Avenida Rio Branco, 1 - 11o andar

20090-003 - Centro - Rio de Janeiro

http://www.epe.gov.br/

Luiz Augusto Barroso

President

Ricardo Gorini

Director

E-mail: [email protected]

Telefone: + 55 (21) 3512 - 3100

Twitter: @EPE_Brasil

Facebook: EPE.Brasil

Documents

The role The role ofooffofhydros hydroshydrosand ...epe.gov.br/sites-pt/publicacoes-dados-abertos/publicacoes... · The role The role ofooffofhydros hydroshydrosand aannddandRES RES