The current expansion of natural gas (NG) development in the United States requires an understanding of how this change will affect the natural gas industry, downstream consumers, and economic growth in order to promote effective planning and policy development. The impact of this expansion may propagate through the NG system and US economy via changes in manufacturing, electric power generation, transportation, commerce, and increased exports of liquefied natural gas. We conceptualize this problem as supply shock propagation that pushes the NG system and the economy away from its current state of infrastructure development and level of natural gas use. To illustrate this, the project developed two core modeling approaches. The first is an Agent-Based Modeling (ABM) approach which addresses shock propagation throughout the existing natural gas distribution system. The second approach uses a System Dynamics-based model to illustrate the feedback mechanisms related to finding new supplies of natural gas - notably shale gas - and how those mechanisms affect exploration investments in the natural gas market with respect to proven reserves. The ABM illustrates several stylized scenarios of large liquefied natural gas (LNG) exports from the U.S. The ABM preliminary results demonstrate that such scenario is likely to have substantial effects on NG prices and on pipeline capacity utilization. Our preliminary results indicate that the price of natural gas in the U.S. may rise by about 50% when the LNG exports represent 15% of the system-wide demand. The main findings of the System Dynamics model indicate that proven reserves for coalbed methane, conventional gas and now shale gas can be adequately modeled based on a combination of geologic, economic and technology-based variables. A base case scenario matches historical proven reserves data for these three types of natural gas. An environmental scenario, based on implementing a $50/tonne CO 2 tax results in less proven reserves being developed in the coming years while demand may decrease in the absence of acceptable substitutes, incentives or changes in consumer behavior. An increase in demand of 25% increases proven reserves being developed by a very small amount by the end of the forecast period of 2025.
This paper is the output from SNL's involvement in the Western Area Power Administration (WAPA), the Colorado River Energy Distributors Association (CREDA), and the Upper Colo rado River Commission's (UCRC) sponsored Phase II work to establish market and non - market valu es (NMV's) of water and hydropower asso ciated with Glen Canyon Dam (GCD) operations and the Colorado River ecosystem. It describes the purpose and need to develop a systems model for the Colorado River Basin that includes valuations in the economic, hydrologic, environmental, social, and cultural sectors . It outlines the benefits and unique features associated with such a model and provides a roadmap of how a syste ms model would be developed and implemented. While not meant to serve as a full development plan, the ideas and concepts herein represent what the Sandia National Laboratories (SNL) research team believes is the most impac tful and effective path forward to address an ever increasing complex set of problems that occur at the basin - scale and beyond .
People save for retirement throughout their career because it is virtually impossible to save all you’ll need in retirement the year before you retire. Similarly, without installing incremental amounts of clean fossil, renewable or transformative energy technologies throughout the coming decades, a radical and immediate change will be near impossible the year before a policy goal is set to be in place. This notion of steady installation growth over acute installations of technology to meet policy goals is the core topic of discussion for this research. This research operationalizes this notion by developing the theoretical underpinnings of regulatory and market acceptance delays by building upon the common Technology Readiness Level (TRL) framework and offers two new additions to the research community. The new and novel Regulatory Readiness Level (RRL) and Market Readiness Level (MRL) frameworks were developed. These components, collectively called the Technology, Regulatory and Market (TRM) readiness level framework allow one to build new constraints into existing Integrated Assessment Models (IAMs) to address research questions such as, ‘To meet our desired technical and policy goals, what are the factors that affect the rate we must install technology to achieve these goals in the coming decades?’
The Water, Energy, and Carbon Sequestration Simulation Model (WECSsim) is a national dynamic simulation model that calculates and assesses capturing, transporting, and storing CO2 in deep saline formations from all coal and natural gas-fired power plants in the U.S. An overarching capability of WECSsim is to also account for simultaneous CO2 injection and water extraction within the same geological saline formation. Extracting, treating, and using these saline waters to cool the power plant is one way to develop more value from using saline formations as CO2 storage locations. WECSsim allows for both one-to-one comparisons of a single power plant to a single saline formation along with the ability to develop a national CO2 storage supply curve and related national assessments for these formations. This report summarizes the scope, structure, and methodology of WECSsim along with a few key results. Developing WECSsim from a small scoping study to the full national-scale modeling effort took approximately 5 years. This report represents the culmination of that effort. The key findings from the WECSsim model indicate the U.S. has several decades' worth of storage for CO2 in saline formations when managed appropriately. Competition for subsurface storage capacity, intrastate flows of CO2 and water, and a supportive regulatory environment all play a key role as to the performance and cost profile across the range from a single power plant to all coal and natural gas-based plants' ability to store CO2. The overall system's cost to capture, transport, and store CO2 for the national assessment range from $74 to $208 / tonne stored ($96 to 272 / tonne avoided) for the first 25 to 50% of the 1126 power plants to between $1,585 to well beyond $2,000 / tonne stored ($2,040 to well beyond $2,000 / tonne avoided) for the remaining 75 to 100% of the plants. The latter range, while extremely large, includes all natural gas power plants in the U.S., many of which have an extremely low capacity factor and therefore relatively high system's cost to capture and store CO2.
People save for retirement throughout their career because it is virtually impossible to save all youll need in retirement the year before you retire. Similarly, without installing incremental amounts of clean fossil, renewable or transformative energy technologies throughout the coming decades, a radical and immediate change will be near impossible the year before a policy goal is set to be in place. Therefore, our research question is, To meet our desired technical and policy goals, what are the factors that affect the rate we must install technology to achieve these goals in the coming decades? Existing models do not include full regulatory constraints due to their often complex, and inflexible approaches to solve for optimal engineering instead of robust and multidisciplinary solutions. This project outlines the theory and then develops an applied software tool to model the laboratory-to-market transition using the traditional technology readiness level (TRL) framework, but develops subsequent and a novel regulatory readiness level (RRL) and market readiness level (MRL). This tool uses the ideally-suited system dynamics framework to incorporate feedbacks and time delays. Future energy-economic-environment models, regardless of their programming platform, may adapt this software model component framework or module to further vet the likelihood of new or innovative technology moving through the laboratory, regulatory and market space. The prototype analytical framework and tool, called the Technology, Regulatory and Market Readiness Level simulation model (TRMsim) illustrates the interaction between technology research, application, policy and market dynamics as they relate to a new or innovative technology moving from the theoretical stage to full market deployment. The initial results that illustrate the models capabilities indicate for a hypothetical technology, that increasing the key driver behind each of the TRL, RRL and MRL components individually decreases the time required for the technology to progress through each component by 63, 68 and 64%, respectively. Therefore, under the current working assumptions, to decrease the time it may take for a technology to move from the conceptual stage to full scale market adoption one might consider expending additional effort to secure regulatory approval and reducing the uncertainty of the technologys demand in the marketplace.