Impact of CO2 Emissions Policy and System Configuration on Optimal Operation of an Integrated Fossil-Renewable Energy Park

Abstract

Future electricity generation systems may include the widespread use of renewables along with fossil fuels. In recent work we developed novel computational procedures for modeling and optimizing the operations of an integrated fossil-renewable power generation system with CO2 capture, subject to a daily average CO2 emission constraint. System components were modeled using energy and mass balances, and a formal optimization procedure was applied to determine the optimal hourly dispatch of system components to maximize operating profit in response to time-varying electricity prices and wind generation. In this study we extend this work by assessing other policy schemes and system designs. First, in lieu of an emission performance standard, CO2 taxes of $10/Mg CO2 to $70/Mg CO2 are applied. Second, we consider emission performance standards ranging from 0.326 Mg CO2/MWh to 1.001 Mg CO2/MWh for systems with oversized and heuristically-sized components. Optimized operating profit shows a nonlinear response to varying emission constraint levels. Taken together, our findings illustrate the effect of different policy schemes on optimized operating economics and CO2 emission levels, and quantify the potential benefits of flexibility in an integrated energy system.