Combined heat and power plants in decarbonized energy systems: Techno-economics of carbon capture and flexibility services at the plant, city and regional levels

Sammanfattning: Our present energy system is the main driver of climate change. Variable renewable electricity generation and carbon dioxide removal (CDR) are key technologies in the transformation to a sustainable energy system, but their broad implementation implies challenges related to energy system flexibility and energy requirements of CDR technologies. The aim of this thesis is to investigate the potential and incentives for CHP plants in Sweden to contribute with CDR and flexibility services in the energy system. A techno-economic assessment scheme that considers variability in boundary conditions, such as electricity prices, and includes the CHP plant, city, and regional energy system levels is developed and applied. System optimization modeling and process-level case studies are performed to investigate how CHP plant flexibility measures are utilized and valued, and to estimate the cost and potential of CDR from Swedish CHP plants. The results indicate a large potential for Swedish CHP plants to contribute to CDR, with at least 10 MtCO2/year being available for capture and storage. The realizability of this potential is challenged by the cost of carbon capture which increases notably for CHP plants that are small and have few full load hours. CHP plants can cost-effectively contribute with flexibility provision in the studied electricity system, although the impact on the total system is limited, as the installed capacity of CHP plants is small relative to the magnitude of net load variability. From a plant perspective, the plant revenue can increase if the operation is scheduled to follow electricity price variability, but this requires a significant level of price volatility and access to large-scale thermal energy storage for maximum benefit. The fuel price has a strong impact on the competitiveness of biomass-fired CHP plants on a regional level, that compete with power-to-heat technologies in the district heating sector. In contrast, in cities, there are stronger incentives for CHP plants as heat producers regardless of how the surrounding energy system and market prices develop, due to a limited availability of other technology options and a limited grid connection capacity to drive power-to-heat.