The West South Central Census Division, which includes Texas, Oklahoma, and Louisiana, is where much of the Nation's natural gas-fired capacity is located. The Northeast and Pacific Contiguous Census Divisions also use natural gas to generate a substantial portion of their electricity. About 40.4 percent of the West South Central Division's CO2 emissions from the generation of electricity comes from gas-fired plants, representing approximately 45.6 percent of all CO2 emissions from natural gas combustion for electricity generation in the Nation. About three-fourths of the Pacific Contiguous Census Division's CO2 emissions are from natural gasfired plants; however, most of that division's electricity generation is produced at nonfossil-fueled plants, such as hydroelectric and nuclear plants. Nonfossil Fuels Nonfossil-fueled generation from nuclear, hydroelectric, and other renewable sources (wind, solar, biomass, and geothermal) represented about 30.0 percent of total electricity generation in 1999 and 30.6 percent in 1998. The use of nonfossil fuels and renewable energy sources to generate electricity avoids the emission of CO, that results from the combustion of fossil fuels. Due to lower marginal costs, nuclear and hydroelectric power generation typically displace fossil-fueled electricity generation. Nuclear plants increased their output by 8.1 percent in 1999 as several plants in the East North Census Division returned to service, contributing to a record capacity factor of 86 percent for nuclear plants in 1999. Nuclear energy provided 19.7 percent of the Nation's electricity in 1999 Two-thirds of the Nation's nuclear power is generated in the New England, East North Central, South Atlantic, and Middle Atlantic Census Divisions, which generate 27.6 percent, 21.0 percent. 26.0 percent, and 35.6 percent, respectively, of their electricity with nuclear power. More than one-half of the Nation's hydroelectric capacity is located in the Pacific Contiguous Census Division, which includes California, Oregon, and Washington. In the Mountain Census Division, Idaho generates virtually all of its electricity at hydroelectric plants. The availability of hydroelectric power is affected by both the amount and patterns of precipitation. High snowpack levels in the Northwest increased hydroelectric generation in Washington and Oregon during 1999, despite the fact that on an annual basis both States received less precipitation in 1999 than they did in 1998. However, the remainder of the Nation experienced dry conditions in 1999, decreasing the amount of hydroelectric power available to displace fossil-fueled generation." Factors Contributing to Changes in CO2 Emissions and Generation The primary factors that alter CO2 emissions from electricity generation from year to year are the growth in demand for electricity, the type of fuels or energy sources used for generation, and the thermal efficiencies of the power plants. A number of contributing factors Influencing the primary factors can also be identified economic growth, the price of electricity, the amount of Imported electricity, weather, fuel prices, and the amount of available generation from hydroelectric, re newable, and nuclear plants. Other contributing factors Include demand-side management programs that en courage energy efficiency, strategies to control other air ermissions to comply with the requirements for the Clean Air Act Amendments of 1990, and the installation of new capacity utilizing advanced technologies to increase plant efficiency, such as combined-cycle plants and combined heat and power projects. Annual changes in CO2 emissions are a net result of these complex and variable factors. As estimated in this report, the amount of anthropogenic CO, emissions attributable to the generation of elec tricity in the United States increased 1.4 percent since the previous year. In 1999, fossil-fueled generation increased by about 2.9 percent; however, almost all of the increase was associated with natural gas, the least carbon-intensive fossil fuel. The increase in CO, emissions from the combustion of natural gas for electricity generation Capacity factor is the ratio of the amount of electricity produced by a generating plant for a given period of time to the electricity that the plant could have produced at continuous full-power operation during the same period. Based on national level consumption and generation data presented in the Electric Power Monthly, and assuming a net summer nuclear capability of 99,000 MW, a 1-percent increase in the annual nuclear plant capacity factor (equivalent to 8,672,400 megawatthours of additional nuclear generation) translates into a reduction in annual consumption of either 4.4 million short tons of coal. 14 million barrels of petroleum, or 92 billion cubic feet of gas, or most likely a combination of each. 9 Energy Information Administration, Electric Power Annual 1999, Volume 1, DOE/EIA-0348(99)/1 (Washington, DC, forthcoming). 10 Energy Information Administration, Cost and Quality of Fuels for Electric Utility Plants, 1999, http://www.eia.doe.gov/ cheaf/electridty/cy/cq_sum.html. Department of Energy and Environmental Protection Agency/ Carbon Dioxide Emissions from the amounted to 46 million metric tons, while the CO2 emissions from the combustion of petroleum and coal decreased 16 million metric tons. The national average output rate declined from 1.350 pounds of CO, per kilowatthour in 1998 to 1.341 pounds CO2 per kilowatthour in 1999. The primary driver of this change was the decreased output rate for coal-fired electricity generation, which went from 2.117 pounds of CO, per kilowatthour to 2.095 pounds of CO, per kilowatthour. A change in the output rate for coal-fired electricity generation in the absence of significant change in non-emitting generation will have the greatest effect on the national average output rate of CO2 per kilowatthour both because coal-fired generation dominates the industry and is the most carbon-intensive fuel. Economic Growth Economic factors influence the demand for electric power. In 1999, a strong economy was measured by the 4.2-percent increase in the Gross Domestic Product (GDP)." Electricity consumption grew by 1.7 percent,12 while the average national price of electricity decreased 2.1 percent, from 6.74 cents in 1998 to 6.60 cents in 1999. Although the growing demand for electricity is primarily met by a corresponding growth in generation, a small amount is met by imported power, primarily from Canada. Weather Weather is another factor affecting the year-to-year changes in the demand for electricity. Both 1999 and 1998 were record-breaking years in terms of warm weather in the United States. The availability of hydroelectric power to displace fossil-fueled power was limited by dry conditions in much of the Nation, with the exception of the Pacific Northwest States. During the summer months, the demand for power for air conditioning is a major factor in setting record high peak demands for some utilities. In 1999, electricity generating plants consumed almost as much coal as the record amount consumed in 1998 and increased their natural gas consumption to meet the continuing high demand for electricity in the summer of 1999. Demand-Side Management (DSM) Energy efficiency programs and DSM activities, such as improving insulation and replacing lighting and appliances with more energy efficient equipment, can reduce the demand for electricity. The reductions in demand achieved by DSM programs contribute to avoided CO2 emissions. In 1998, 49.2 billion kilowatthours of energy savings were achieved by DSM activities at electric utilities, a decrease from 56.4 billion kilowatthours in 1997. Declining levels of energy savings reflect, in part, lower utility spending on DSM programs. In 1998, utilities' total expenditures on DSM were $1.4 billion, a decrease of 13.1 percent from the previous year, and nearly 50 percent below the 1994 spending level." Data for 1999 are not yet available. Fossil and Nonfossil Fuels for Electricity The fuel or energy source used to generate electricity is the most significant factor affecting the year-to-year changes in CO, emissions. Because hydroelectric and nuclear generation displace fossil-fueled generation when available, CO2 emissions increase when hydroelectric or nuclear power is unavailable and fossil-fueled generation is used as a replacement. Conversely, CO2 emissions can be reduced through a greater use of nuclear, hydroelectric, and renewable energy for electricity generation. Collectively, nonfossil-fueled electricity generation by nuclear, hydroelectric, and renewable energy sources that do not contribute to anthropogenic CO2 emissions remained almost unchanged in 1999 as compared to 1998, with much of the increase in nuclear generation being offset by an absolute decrease in hydroelectric power generation and other generation from fuels such as municipal solid waste, tires, and other fuels that emit anthropogenic CO2 when burned to generate electricity. As stated previously, the amount of available hydroelectric power is affected by precipitation patterns. In 1999, hydroelectric power generation was lower in all regions, except in the Northwestern States. Oregon, Idaho, and Washington typically generate more than 90 percent of their power at hydroelectric plants and export power to California. Hydroelectric power generation 11 http://www.bea.doc.gov/bea/dn1.htm, Department of Commerce web site, accessed May 10, 2000. "Retail sales by utilities grew 1.73 percent from 1998 to 1999 Retail sales by marketers in deregulated, competitive retail markets are not included. The addition of an estimated 48 billion kilowatthours in retail marketer sales would result in an increase in electricity consumption of 2.45 percent from 1998 to 1999. 13 Energy Information Administration, Electric Power Annual 1999, Volume I. DOE/EIA-0348(99)/1 (Washington, DC, forthcoming). 14 DSM data for 1999 will be available in the latter part of 2000. Department of Energy and Environmental Protection Agency/ Carbon Dioxide Emissions from the increased in 1999 in these States, reducing the need for fossil-fueled generation and contributed to keeping CO2 emissions low in the Pacific Contiguous Census Division. Nationally, hydroelectric power generation decreased by 3.6 percent in 1999. Nuclear power generation increased by 8.1 percent to a record level in 1999, which contributed to keeping CO2 emissions lower by displacing fossil-fueled generation, particularly in the East North Central Census Division. Several nuclear plants came back online in 1999, helping to increase the average nuclear capacity factor to 86 percent. An absolute increase in the amount of nuclear power more than offset the loss of some hydroelectric power in 1999. Fuel Quality and Price The amount of CO2 emissions from the combustion of fossil fuels to generate electricity varies according to the quality of the fuels, defined by their carbon content and the associated heating value (Btu) is The Btu content of fuels is a determinant of the number of kilowatthours that can be produced and carbon content is a determinant of the amount of CO, released when the fuel is burned. Fossil fuels are categorized as either coal, natural gas and other gaseous fuels, or petroleum and petroleum products. Coal-fired electricity generation has the highest output rate of CO2 per kilowatthour produced, averaging 2.095 pounds per kilowatthour in 1999. Petroleum-fired electricity generation averaged 1.969 pounds per kilowatthour, and natural gas-fired electricity generation had the lowest rate of 1.321 pounds per kilowatthour. With coal-fired plants generating the majority of electricity in the Nation and having the highest output rate, they produced the greatest share of CO2 emissions from electricity generation, approximately 80 percent of the total. Some plants are capable of switching fuels to take advantage of the least expensive or the most available resources. In 1998, the price of crude oil reached its lowest level since 1976, causing the price of petroleum delivered to electric utilities to fall below that of natural gas for the first time since 1993. This factor is important when considering the capability of some electric plants to burn the least expensive of these two fuels. As a result of falling prices in 1998, petroleum-fired gen eration was higher in 1998 than in 1997. However during 1999, the price of petroleum began to increase, and generation from petroleum plants declined. Petroleum has a higher output rate of CO, than natural gas; there fore, switching from petroleum to natural gas can have a beneficial effect on both the overall amount and output rate of CO, emissions. In 1999, virtually all of the increase in fossil-fueled generation was from natural gas-fired plants. Coal-fired electricity generation was close to unchanged, while petroleum-fired electricity generation fell. Most of the increase in CO, emissions from gas-fired plants was offset by the decline in CO2 emissions from petroleumand coal-fired plants. Thermal Efficiencies of Power Plants CO2 emissions from electric power generation are influenced by the efficiency with which fossil fuels are converted into electricity. In a typical power plant, about one-third of the energy contained in the fuel is converted into electricity, while the remainder is emitted as waste heat. Substantial improvements in generation efficiency can be achieved in the future through the replacement of traditional power generators with more efficient technologies, such as combined-cycle generators and combined heat and power (CHP) systems. In these types of systems, waste heat is captured to produce additional kilowatthours of electricity or displace energy used for heating or cooling. Both strategies result in lower CO2 emissions. The national average thermal efficiency of power generation from fossil fuels in 1999 was estimated to be 32.54 percent, slightly higher than the previous year's average of 32.42 percent." The average thermal efficiency of coal-fired plants went from 33.15 percent to 33.54 percent in 1999. The improvement in efficiency is also reflected in the national average output rate of pounds of CO, per kilowatthour. The output rate for coal-fired plants decreased from 2.117 pounds of CO2 per kilowatthour in 1998 to 15 Heating value is measured in British thermal units (Btu), a standard unit for measuring the quantity of heat energy equal to the quantity of heat required to raise the temperature of 1 pound of water 1 degree Fahrenheit. "Boiler type and efficiency, capacity factor, and other factors also affect the number of kilowatthours that can be produced at a particular plant. 17 The thermal efficiency is a ratio of kilowatthours of electricity produced multiplied by 3.412 Btu to the fuel consumed, measured in Btu. This ratio is dependent on the estimated generation and fuel consumption for 1999. Uncertainty and an undetermined degree of variation in both generation and fuel consumption data for the nonutility sector may contribute to an apparent change in the ratio, which should be regarded as a preliminary value at this time. Department of Energy and Environmental Protection Agency/ Carbon Dioxide Emissions from the 2.095 in 1999. Petroleum-fired plants and natural gasfired plants showed slightly lower thermal efficiencies in 1999, with a corresponding change in the output rate. The rate for petroleum-fired plants increased from 1.915 to 1.969 pounds of CO, per kilowatthour, and natural gas-fired plants' output rate increased from 1.314 to 1.321 pounds of CO2 per kilowatthour. Conclusion The emission of CO, by electric power plants is not controlled because no standards or required reductions currently exist. Some technology is available to limit CO2 emissions, but it is extremely expensive. The options to limit the emission of CO2 from electricity generation are to encourage reduction of the overall consumption of electricity through energy efficiency and conservation initiatives, to improve combustion efficiency at existing plants or install new units that employ more efficient technologies, such as combined-cycle units and combined heat and power (CHP) systems, and to replace fossil-fueled generation with nonfossil-fueled alternatives, such as nuclear, hydroelectric, and other renewable energy sources. Comparison of Projected with Actual CO2 Emissions and Generation by Fuel Type Each year, the Energy Information Administration prepares the Annual Energy Outlook (AEO), which contains projections of selected energy information. Projections for electricity supply and demand data, including CO2 emissions and generation by fuel type, are made for the next 20 years. To evaluate the accuracy and usefulness of the forecast, a comparison was made between the latest forecast for 1999 (from the AEO2000) and the estimated actual data for 1999 (Table 5). The near-term projections in the AEO are based on a combination of the partial-year data available when the forecast was prepared, the latest short-term forecast appearing in the Short-Term Energy Outlook, and the regional detail contained in the National Energy Modeling System (NEMS). Consequently, comparisons with the actual data for 1999 are not a definitive indicator of the accuracy of the longer-term projections appearing in the AEO. Nevertheless, they do provide a useful preliminary gauge for tracking and measuring the projections against actual data over time. Total electricity-related CO2 emissions for fossil fuels in 1999 were 1.4 percent below the projected emissions level, while the actual total generation from fossil fuels was 0.9 percent above the projected generation level. The largest percentage difference between projected and actual generation by fuel (other than for "Other") was for natural gas-fired generation, which was 3.7 percent higher than projected, but with a corresponding difference in CO, emissions of 7.7 percent. However, the largest absolute difference between projected and actual CO, emissions by fuel was for coal-fired generation, whose ernissions were 75 million metric tons, or 4.0 percent, below the projected level, even while generation was 0.2 percent higher. Three primary factors contribute to the divergence in projected and actual CO2 emissions: • Efficiency of generating units. Average generating efficiencies for coal-fired capacity were higher in 1999 than those assumed by NEMS, on the order of about 4 percent. On the other hand, the efficiency of natural gas-fueled capacity was about 4 percent lower than the NEMS assumptions. Because coalfired units produce more than three times the generation of natural gas-fired generators, the impact of the higher efficiencies of coal-burning capacity outweighs the lower actual efficiencies for natural gas capacity. Efficiencies for petroleumbased generation, a much smaller share of overall supply, were 5.6 percent lower than the NEMS assumptions. • Total generation requirements. Overall electricity generation was 1.6 percent higher in 1999 than projected. This was due to the combined effects of higher sales, lower imports, and higher losses for electricity than expected. The incremental generation requirements were met in part by higher natural gas-fired generation, as well as greater reliance on nonfossil sources of electricity such as nuclear and renewables. To the extent that natural gas-fired generation was above the forecast, higher CO2 emissions resulted. • Increased nuclear and hydroelectric generation. Nuclear generation was 30 billion kilowatthours, or 5.7 percent, above the projected levels in 1999. The difference was due primarily to improving performance of nuclear generating units, beyond that assumed in the projections. Also, hydroelectric generation was 13 billion kilowatthours, or 4.3 percent, above projections. Given the same overall level of generation, higher nuclear and hydroelectric projections would have resulted in less projected Department of Energy and Environmental Protection Agency/ Carbon Dioxide Emissions from the 70-630 D-01--37 Table 5. U.S. Electric Power Industry Projected and Actual Carbon Dioxide Emissions and Generation, *Other fuels include municipal solid waste (MSW), tires, and other fuels that emit anthropogenic CO, when burned to generate electricity. MSW generation represents the largest share of this category. MSW projections in the Annual Energy Outlook 2000 are assumed to have zero net CO2 emissions. Due to a change in the accounting for MSW by the Environmental Protection Agency, future AEOs will estimate the CO2 emissions attributed to the non-biomass portion of this fuel. If this had been done for the AEO2000, CO2 emissions for MSW would have been 14 million metric tons for 1999. Includes nuclear and most renewables, which either do not emit CO, or whose net CO2 emissions are assumed to be zero. "Data for 1999 are estimated. Note: Actual data for CO2 emissions and electricity generation for 1999 are preliminary. Components may not add to total due to independent rounding. Sources: Projections: Energy Information Administration, Annual Energy Outlook 2000, DOE/EIA-0383 (2000) (Washington, DC, December 1999) and supporting runs of the National Energy Modeling System. Actual: Carbon dioxide emissions and generation: Table 1; other data: Energy Information Administration, Monthly Energy Review, April 2000, DOE/EIA-0035(2000/04) (Washington, DC, April 2000); Energy Information Administration, Short-Term Energy Outlook, May 2000 (EIA Web site, www.ela.doe.gov/emeu/steo/pub/contents.html). generation from fossil fuels, thus bringing electricity-related CO2 emissions more in line with actual data. Voluntary Carbon-Reduction and Both the DOE and the EPA operate voluntary programs Include DOE/EIA's Voluntary Reporting of Greenhouse EIA's Voluntary Reporting of Greenhouse Gases Program collects information from organizations that have undertaken carbon-reducing or carbon-sequestration projects. Most of the electric utilities that report to the Voluntary Reporting Program also participate in voluntary emission reduction activities through DOE's Climate Challenge Program. In 1998, as part of the Voluntary Reporting Program, 120 organizations in the electric power sector reported on 1,166 projects Department of Energy and Environmental Protection Agency/ Carbon Dioxide Emissions from the |