02 iws bruce smiths role of ro and pv in the power and water portfolio of the future

Burden or Benefit?

The Role of RO and PV in the Abu Dhabi Power and Water system Bruce Smith, Planning and Forecasting Director, ADWEC January 2017 1

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ADWEC’s Planning Objectives Defined in Law and Licence: Policy directions (e.g. emissions targets, technology choices)

Security of Supply

Minimise Total System Cost

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The Impact of Gas Cost on Generation Cost

For gas fired generation we are moving from a world fuel was less than 50% of the cost to one where it is likely to be over 80% 3

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The Impact of Gas Cost on Generation Cost

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Gas Costs Saved by PV 10 9 8 Marginal gas price ($/MMBTU) Range of bids 7 received by ADEWA 6 5 4 Range of corresponding gas prices

3 2 1 0 20

Unweighted LEC of $29.2 MW/h equivalent to 10.7 fils/KWh 30

40

50

60

70

80

90

LCOE for Solar PV ($/MWh)

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Why RO? • • • •

Lower energy consumption Lower capital cost (higher variable O &M) Greater operational flexibility Unit cost less affected by changes in demand 6000 Gas cost to generate electricity that the steam could have produced

5000

4000 Cost ($/MIGD) 3000

2000

Direct electricity cost

1000

0

Variable O&M cost

RO LRMC

MSF LRMC

MED LRMC

Capex cost

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Why RO? 50

System Water Production Costs in 2020 vs Gas Price

45

Water Production Cost in AED/TIG

40

46.4 40.5

35

34.6

30 25

25.7

20

19.8

15 13.9 10 5 0

2

1

1

2

3

4

3

4

5

6

7

8

6

5

9

10

11

12

Gas Price in USD/MMBTU

New RO Plant

Total System

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Thank You

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