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Environmental costs of electricity generation

TR 2012/18
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Report: TR 2012/18

Author: T Denne (Covec Ltd)

Abstract

This report examines the environmental costs of alternative technologies for electricity generation. It is an update to a previous report that provided information on the market and environmental costs.

The report aims to provide technical information both to assist Waikato Regional Council in its development of policies relating to energy and its local communities in considering the implications of proposals for new plants. It also provides some context for the consideration of national versus local interest in electricity supply.

The report is limited to the implications of electricity generation; it does not consider the impacts of transmission which are the subject of analyses in other fora.

The previous (2006) study examined a limited number of costs. It included private costs of electricity generation based on recent studies undertaken for the Ministry of Economic Development (MED). The environmental effects were limited to emissions of CO2, CH4, N2O, SO2 and NOx. Since this publication there have been changes in the policy setting for greenhouse gas emissions that changes the nature of the costs of these emissions. In addition, there have been new studies that have examined the costs of individual pollutants, especially particulates. This report summarises this new information.

The results in this report do not reflect a comprehensive analysis of all external effects; rather the analysis has been limited to the most significant impact categories. International studies of the full life cycle impacts of generation have suggested that the effects are dominated by those associated with air emissions from generation.

Environmental costs of electricity generation [PDF, 1.2 MB]

Contents
  Executive summary i
1 Introduction 1
1.1 Scope 1
1.2 Rationale 1
2 Private costs 3
2.1 Structure of electricity costs 3
2.2 Generation costs and wholesale pricing 4
2.3 Existing plants 5
2.4 Costs of new plants 7
3 Costs of emissions to air 10
3.1 Carbon dioxide (CO2) 10
3.2 Methane (CH4) and nitrous oxide (N2O) 16
3.3 Sulphur dioxide (SO2) 17
3.4 Small particulates 25
3.5 Nitrogen oxides (NOx) 26
3.6 Summary of impacts 27
4 Total costs 29
5 References 31