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What kind of new generating plant for the Netherlands?

An upgrade of the CE model

In the context of the current Dutch debate on the preferred option for new power stations in the Netherlands, CE Delft has used a cash-flow computer model, developed in-house, to calculate the cost efficiency of various types of generating plant as a function of fuel prices and CO2 prices. The preferred option for industry and the energy sector is coal-fired generating plant, because of the lower electricity production costs. From the angle of climate policy and NEC policy, renewables or gas-fired stations are preferable, but these have higher production costs. On the other hand, future climate policy is very likely to involve introduction of higher charges for CO2 emissions, which will push up production costs, particularly in the case of coal-fired plant. One solution to this problem might be CO2 capture and sequestration. An alternative is not to go for coal or gas, but for nuclear. The main conclusions from CE’s analysis are as follows:
  • From about € 20 - €40 per tonne CO2 upwards, coal-fired and gas-fired power stations with CO2 capture and sequestration are more cost-efficient than those without.
  • With high fuel prices, and considering only CO2 impacts (and not risks or other, environmental impacts), nuclear power is the cheapest option from about € 30 per tonne CO2 upwards.
  • With low fuel prices, Gas Turbine Combined Cycle Plant with CO2 capture and sequestration is structurally cheaper than nuclear.
  • Cogeneration of heat and power is a better option than pure power generation: it reduces CO2 emissions by several hundred kilotonnes, creating a significant difference in the cost efficiency of the two types of plant.

Authors CE

Harry Croezen
Frans Rooijers

Delft, November 2006

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