Identifying Sustainable Electricity Options for Chile

Access to files

•   FULL-TEXT.PDF (pdf)

Abstract

This research aims to assess the environmental and economic sustainability of current and future electricity generation in Chile from a life cycle perspective. Life cycle assessment has been carried out for each technology taking into account resources, energy, emissions and waste flows across the life cycle stages from cradle to grave. As a result, eleven environmental impacts have been estimated. The year 2050 has been chosen as the target year for the future scenarios that have been obtained through an investment optimization model. This linear programing model has been created to find cost-optimal options that enables high renewable penetration with operation flexibility provided by short- and long-term storage options. A multi-criteria decision analysis (MCDA) has been applied to support decision-making; this consists of aggregating several indicators into a single score. About 60% of power is currently supplied by coal, gas and oil, 34 % by hydropower, while biomass, biogas, wind and solar photovoltaics (PV) produce the remainder. The results reveal that in the current electricity system hydropower is the most sustainable option across all impacts, followed by wind and biogas. Electricity from natural gas has lower impacts than biomass, solar PV and wind for seven, six and four impacts respectively. Solar PV has the highest abiotic depletion due to the use of scarce elements in its manufacture. Coal and oil are the least sustainable options with impacts mostly attributed to fuel production and combustion. The use of petroleum coke as secondary fuel in coal plants worsens the impacts. While in the past 10 years the electricity demand grew by 44%, all the impacts except ozone depletion increased by 60%-170%. The economic figures show that hydropower and coal have the lowest costs of 49.9-64.9 and 75.3 $/MWh respectively. Despite this, in the last decade the country has endured high hydrological variability, volatile fossil fuel prices, gas curtailments, high level of market concentration, and high power demand, that have caused large electricity prices (126 $/MWh) to affect the Chilean economy and society. The current power options plus concentrating solar power and geothermal have been the options considered to develop future scenarios. Twelve scenarios have been modelled based on different constraints. Six are renewable electricity (RE) scenarios, which phase-out all fossil fuel options by 2050. The other six are Business as usual (BAU) scenarios, which do not include this constraint; the renewable electricity contribution in the BAU scenarios ranged from 80% to 88%. The results suggest that all scenarios have lower environmental impacts than at the present. For example, the BAU scenarios have 51% lower environmental impacts than the current electricity system, while the RE scenarios have 87% lower impacts. The depletion of resources in the future scenarios is higher than the present mainly due to solar PV contribution. Due to the high costs, natural gas and oil are not included in any scenario, while biomass power had marginal power contribution. When solar PV reaches above 20% of electricity share, other renewable power options experience energy spillage and thermal power plants are cycling more often, resulting in a reduction of capacity factors and leading to a rising of costs. MCDA helped to identify the most sustainable scenario: RE260-Base, and to highlight the importance of hydropower to keep the system costs low thanks to its long-term storage capacity.

Keyword(s)

Environmental impacts; Global warming; Investment optimization; Levelized costs of electricity; Life cycle assessment; Power generation; Renewable technologies

Bibliographic metadata

Institutional metadata

Record metadata