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Assessing social costs and benefits from air pollution control at a

coal-fired power plant

Final version: June 2010

Jonathan van der Kamp

European Institute for Energy Research (EIFER) Emmy-Noether-Str. 11

D – 76131 Karlsruhe vanderkamp@eifer.org

Abstract

In the framework of EU environmental policy-making, cost-benefit analyses (CBAs) are increasingly applied. This is particularly the case for legislation concerning air pollution control, thereby affecting mainly the energy and the transport sector. According to economic principles, the environmental benefits of investments into air pollution control measures should outweigh the corresponding private costs. In the current paper, this principle is verified, taking a coal-fired power plant as an exemplary case. A social cost-benefit analysis (CBA) is conducted concerning the installation of a selective catalytic reduction (SCR) for the abatement of NOx emissions. Environmental benefits, expressed as a reduction in external costs, are calculated by EcoSenseWeb1. The results show that substantial health benefits are achieved through reduced emission levels. This also translates into a positive evaluation from a public welfare point of view by means of the CBA. However, the selected approach has some shortcomings, amongst which is the non-consideration of up- and downstream processes. Therefore, as a first step towards improving the methodology, a simplified approach is presented, yielding the external costs related to additional up- and downstream processes. Using this extended approach, the result of the CBA is reassessed. Another shortcoming is the uncertainty connected to the EcoSenseWeb parameter settings. This issue is addressed by a sensitivity analysis in which the EcoSenseWeb parameter settings are varied. Meanwhile, including further processes and modifying the parameter settings, does not change the basic outcome of the CBA. An outline of future research is given and a link to environmentally extended input-output (EE IO) tables is established. The prospective aim is to combine external costs and life cycle assessment (LCA) in the framework of societal life cycle costing.

1 EcoSenseWeb is a web-based software developed by the IER (Institute of Energy Economics and the Rational Use of Energy, University of Stuttgart ) for the calculation of external costs in the energy sector, cf. chapter 2.1

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Contents

1 Introduction... 3

1.1 Context & Objectives ... 3

1.2 Structure ... 4

2 Methodological Background ... 4

2.1 EcoSenseWeb ... 4

2.2 Cost-Benefit Analysis (CBA)... 7

3 CBA of a SCR Installation at a Coal-Fired Power Plant... 8

4 Extended CBA including Up- and Downstream Processes & Evaluation of Uncertainty... 11

5 Uncertainty - Influence of EcoSenseWeb Parameter Settings on the External Costs... 13

6 Conclusion and Outlook on Future Research ... 16

7 Bibliography... 17

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1 I

NTRODUCTION

1.1 Context & Objectives

In the framework of EU environmental policy-making, cost-benefit analyses (CBAs) are increasingly applied. This is particularly the case for legislation concerning air pollution control, where comprehensive impact assessment studies were carried out, comparing the social costs and benefits related to different levels of environmental protection (cf. Pye and Holland (2007), di Valdalbero and Valette (2010) and Entec UK Limited (2010)). The economic principle, stating that the social benefits of a specific policy or measure should outweigh the social costs, also holds true for the micro level. Therefore, the current paper addresses the following question:

• How can an up-to-date method for external cost quantification be used for conducting a social CBA that assesses the installation of an emission abatement technology at a coal-fired power plant?

For the purpose of this study, the installation of a selective catalytic reduction (SCR) for the reduction of NOx emissions at a coal-fired power plant is evaluated. An important premise for conducting social CBAs is the inclusion of external costs (Pearce et al. 2006). In the case of electricity generation, these are costs to society that are not or only partly incorporated into the electricity price. For single facilities in the energy sector, external costs can be calculated by means of the web-based software EcoSenseWeb that was released in 2007 during the EU-funded NEEDS (New Energy Externalities Developments for Sustainability)2 project. EcoSenseWeb is based on the ExternE (Externalities of Energy)3 methodology and allows for the site-specific quantification of external costs. It yields external costs in the following impact categories: human health, damage to building materials and to crops, terrestrial biodiversity losses and climate change. Yet, the implemented CBA has some shortcomings. First, for conventional power plants EcoSenseWeb only allows for including external costs due to selected air pollutants and in specific categories (see above) and thus assesses only a part of the total external costs. Second, the CBA focusses on the process of electricity generation, as EcoSenseWeb provides only limited means to include up- and downstream processes. This second shortcoming, which relates to principles of life cycle assessment (LCA), shall be partly overcome in this paper by applying a simplified approach for the inclusion of external costs from relevant up- and downstream processes. This leads to the following question:

• How does the result of the initial CBA evolve when additional up- and downstream processes are included in the assessment?

2 For more information refer to www.needs-project.org, last visited : 10/03/30 3 For more information refer to www.externe.info, last visited : 10/06/07

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Another critical point concerning the use of external costs is their inherent uncertainty. This issue is addressed by a sensitivity analysis in which the influence of the EcoSenseWeb parameter settings on the quantified external costs is assessed. For future research, the aim is to proceed towards societal life cycle costing (Hunkeler et al. 2008), combining not only private costs and elements of life cycle impact assessment (LCIA) but replacing standard impact category results by their external costs.

1.2 Structure

After describing the methodological background of EcoSenseWeb and CBA, environmental benefits related to the installation of a SCR at a coal-fired power plant are assessed with help of EcoSenseWeb. The result is then used in the CBA of the SCR installation. Subsequently, an extended approach is applied including the external costs of further relevant up- and downstream processes. This is followed by an analysis of the uncertainty connected to the EcoSenseWeb parameter settings. In the outlook, the link to environmentally extended input-output (EE IO) tables and societal life cycle costing is pointed out.

2 M

ETHODOLOGICAL

B

ACKGROUND

2.1 EcoSenseWeb

General information

EcoSenseWeb is an internet-based software tool for the site-specific quantification of external costs from emission sources. It has been developed at the IER (Institute of Energy Economics and the Rational Use of Energy, University of Stuttgart) and it was released during the NEEDS project in 2007. The EcoSenseWeb methodology is based on the Impact Pathway Approach (IPA), developed in ExternE, and further amended by the latest findings of NEEDS. External costs resulting from different pollutant groups are assessed in different ways in EcoSenseWeb. The assessment of classical air pollutants is carried out step-by-step according to the IPA. By contrast, fixed cost factors lumping the steps dispersion, exposure and monetization into one value are used for greenhouse gases (GHGs), micro pollutants and radio nuclides. For GHGs also avoidance costs are available. All of these cost factors originate from other models. Moreover, external costs of biodiversity losses related to changes in land use can be calculated in EcoSenseWeb. Detailed information about EcoSenseWeb is given in the official user manual (Preiss and Klotz 2008). EcoSenseWeb version 1.3 was applied in this study.

The impact pathway approach for the assessment of impacts from classical air pollutants

The IPA is a “bottom-up” approach that describes the conceptual procedure in order to calculate the external costs of a specific activity. In EcoSenseWeb, specific impact pathways of classical air pollutants are included. These impact pathways describe effects on:

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• Human health: mortality and morbidity effects due to emissions of SO2, NOx, PM10, PM2.5, NH3 and NMVOC,

• biodiversity: losses through eutrophication and acidification due to emissions of SO2, NOx and NH3,

• building materials: damage due to emissions of SO2, NOx and NH3,

• crops: effects due to emissions of SO2, NOx and NH3.

Details concerning these emission pathways, the corresponding dose-response functions (DRFs), as well as the monetary valuation can be found in Preiss and Klotz (2008, p. 48ff).

Assessment of GHG emissions, micro pollutants and radio nuclides

In the case of GHGs, micro pollutants and radio nuclides, EcoSenseWeb does not assess each of the single steps of the IPA separately. Instead, fixed damage factors for each single pollutant are multiplied by the annual amount of emissions of the corresponding pollutant to yield the annual external costs (Preiss and Klotz 2008, p. 24ff).

Input data and calculation parameters for external costs calculations

The input data the user is requested to enter in EcoSenseWeb is summarised in Tab. 1.

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Tab. 1 User input data in order to define an emission source in EcoSenseWeb

Category Parameter Unit

Information on power plants General information

Flue gas specifications Location of the facility

Building properties

Description

Electricity production per year Full load hours per year Volume stream Temperature Country Longitude Latitude Stack heigt Stack diameter text GWh / a h Nm³ / h K ° E ° N m m Emissions of air pollutants

Major parts

Minor parts (micro pollutants)

SO2, NOX, PM10, PM2,5, NH3, NMVOC Cd, As, Cr, Ni, Hg, Pb Cr-VI, CH2O Dioxin mg / Nm³ µg / Nm3 µg / Nm3 µg / Nm3

Land use change area

Land use before / after

km²

Emissions of GHGs CO2, CH4, N2O t / a

Radio nuclide emissions see Preiss and Klotz (2008, p. 26ff) Bq / kWh Source: adapted from http://ecosenseweb.ier.uni-stuttgart.de/io_data.html, last visited: 10/06/07

After entering the input data, the user is able to adapt distinct calculation parameters according to his needs. Unless stated otherwise, EcoSenseWeb standard settings are applied in this study.

EcoSenseWeb standard settings

EcoSenseWeb allows the user to adjust certain settings when configuring a case study. In the following, selected standard settings and their implications are shortly explained.

Currency and base year: All cost data is expressed in €2000.

Methodology for the assessment of health damage through classical air pollutants: Impacts on human health through classical air pollutants are calculated by using a certain number of so-called core DRFs.

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Moreover, the toxicities of different primary and secondary particles are treated as equal (Preiss and Klotz 2008, p. 33).

Climate change: Different assessment methods can be chosen for the quantification of external costs from GHG emissions. The default setting uses a cost factor of 19 €2000 per tonne of CO2,equiv emitted. Alternatively, either a self-determined cost factor, factors derived through a marginal damage costs (MDC) approach, or through a marginal abatement costs (MAC) approach can be selected as basis for the calculation (Preiss and Klotz 2008, p. 35f).

2.2 Cost-Benefit Analysis (CBA)

A CBA is a policy instrument for decision-making that compares the social costs and benefits of one or several specific activities or projects. In the given context, the term social includes both private and external effects. Therefore, external costs are an integral part of CBAs. When avoided, they constitute social benefits. According to Pearce et al. (2006, p. 45), the decision-rule of a CBA is as follows:

{ t} > 0 t i t i t t i t i

s

C

s

B

+

+

*

(

1

)

*

(

1

)

, , , , With: i: affected individuals t: time horizon B: social benefits C: social costs s: discount rate

This rule states that if for a certain sum of individuals and during a certain time period the total discounted benefits exceed the total discounted costs, the activity or project in question can be seen as advantageous from a public welfare point of view. In other words, the decision rule tests if the net present value of the project in question is positive. The rationale of discounting indicates that future costs and benefits are given less weight than today’s costs or benefits (Pearce et al. 2006, p. 42). An overview of CBAs and the use in an energy policy context is given in Melichar et al. (2009).

It is important to note that a CBA constitutes only one instrument among others for the assessment of public or private projects. In addition, not all elements that have an influence on the final decision are included in a CBA. Missing elements in the present case are, for instance, non-quantified externalities (e.g. direct emissions of pollutants into water), geo-political considerations (e.g. affecting the security of supply) or potentially changing regulatory constraints.

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3 CBA

OF A

SCR

I

NSTALLATION AT A

C

OAL

-F

IRED

P

OWER

P

LANT

Technical details on the coal-fired power plant

For the purpose of this study, an existing pulverised-combustion (PC) hard coal-fired power plant with a capacity of 600 MW is taken as exemplary case. The assumed location of the power plant is Western Europe. Basically, two scenarios are compared: one scenario without and one scenario with a SCR for the reduction of NOx emissions. Besides the SCR installation, the power plant is assumed to be equipped with a wet limestone scrubber for the abatement of SO2 emissions and with an electrostatic precipitator for the abatement of particulate matter (PM). The power plant’s operating time is 3500 full load hours per year, generating 2050 GWh of electricity. In Tab. 2, the effect of the SCR installation on the EcoSenseWeb input data is displayed. All other input data is equal in both scenarios.

Tab. 2 EcoSenseWeb input data without and with SCR

Without SCR With SCR

Power plant information

Electricity production [GWh / a] * 2050 2039.75

Emissions of classical air pollutants

NOx [mg / Nm³] 740 200

* Net electricity production; in the scenario with SCR, it is assumed that 0.5 % of the power plant capacity is used for the operation of the SCR (European Commission 2006, p. 116). As a consequence, the net electricity production is decreased by 0.5 % and the specific emissions per kWhel increase.

External costs before and after the installation of a SCR

In order to estimate the environmental benefits, the external costs without and with SCR are calculated by means of EcoSenseWeb. The results are presented in Figure 1.

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External costs of a coal-fired power plant before and after the installation of a SCR [€-Cent (2000) / kWh] 0.00 1.00 2.00 3.00 4.00 5.00 Climate change 1.68 1.69 Biodiversity 0.21 0.09 Building materials 0.04 0.03 Crops 0.03 0.00 Human health 2.57 1.22 Without SCR With SCR

Figure 1 - Marginal external costs of a coal-fired power plant without and with SCR, calculated using EcoSenseWeb 1.3

As can be seen above, the SCR installation has an imporant influence on the external costs related to human health that are decreased by over 50 %. This decrease can be attributed to the reduced formation of secondary inorganic aerosols (SIAs) in the form of nitrates. On the other hand, a slight increase in external costs related to climate change can be observed which is due to the small loss in power plant efficiency caused by the energy demand of the SCR.

CBA of the SCR installation

Adding up the marginal external costs among all impact categories in Figure 1 yields the total marginal external costs as displayed in Tab. 3. Further, when multiplied by the amount of electricity produced, the yearly total external costs can be derived that are also given below.

Tab. 3 Marginal and absolute quantified external costs of a coal-fired power plant before and after the installation of the SCR

Without SCR With SCR

Marginal external costs [€-Cent2000 / kWhel] 4.54 3.03 Absolute external costs [million €2000 / a]* 92.980 62.049 * based on a yearly net electricity production of 2050 GWh

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Comparing the absolute quantified external costs before and after the installation of the SCR leads to the following annual social benefit:

• 30.9 million €2000

The remaining input parameters of the CBA are as follows: Affected individuals

Effects in all countries that are implemented in EcoSenseWeb are considered (for details, refer to Preiss and Klotz 2008, p.11ff).

Time horizon

The power plant with SCR is expected to operate from the year 2010 to the year 2030 (t = 0 to 20). Discount rate

Following a recommendation of the CASES (Cost Assessment of Sustainable Energy Systems) project, a social discount rate of 3 % for both costs and benefits is selected for the CBA (Kuik et al. 2008, p. 129). Social costs

In the present context, the term social costs refers to private costs only since the external costs are included in the social benefits. The private costs consist of the investments and the annual operating costs of the SCR during its lifetime. The cost data presented hereafter is derived from a spreadsheet provided by the Expert Group on Techno-Economic Issues (EGTEI 2005) for a SCR at a coal-fired power plant similar to the one in the current study:

- Annualised total costs (per annum over 20 years): 2 895 728 €

This leads to a repartition in time as displayed in Tab. 4.

Tab. 4 Annualised investments and operating costs of the SCR [million €2000 / a]

2010 2011 ... 2030

Annualised total costs 2.896 2.896 2.896 2.896

Source: EGTEI (2005)

Result of the CBA

Integrating the above defined input data into the general formula of a CBA (cf. Section 2.2) yields: t t t t t t

Mio

Mio

− = = − = =

30

.

9

.€

*

(

1

.

03

)

2

.

896

.€

*

(

1

.

03

)

20 0 20 0

= 491.1 million € - 46 million € = 445.1 million € > 0 As a result, it can be stated that the investment into the SCR can be seen as advantageous from a public welfare point of view.

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4 E

XTENDED

CBA

INCLUDING

U

P

-

AND

D

OWNSTREAM

P

ROCESSES

&

E

VALUATION OF

U

NCERTAINTY

The CBA as presented in chapter 3 has some shortcomings, amongst which is the disregard of up- and downstream processes. In an attempt to make the CBA more comprehensive and to overcome this shortcoming, the air emissions caused by the SCR operation (including ammonia provisioning and catalyst disposal) are now included in the assessment framework of the CBA. External costs related to the operation of the SCR were already considered in the initial CBA in chapter 3 in terms of a reduced net electricity generation. Unfortunately, the available dataset does not enable to determine the air emissions due to ammonia provisioning and catalyst disposal separately but instead provides aggregated air emissions including the SCR operation phase. Therefore, a partial double counting cannot be prevented. Air emissions due to construction and dismantling of the coal-fired power plant itself and of other auxiliary services were not considered since it is assumed that these emissions will not vary due to the SCR installation. For the time being, no complete life cycle inventory was created but instead a simplified approach is applied, consisting of two stages:

Step 1: Total annual emission quantities of the most relevant GHGs and air pollutants (CO2, CH4, N2O, PM10, SO2 and NOx) for the considered processes are defined.

Step 2: These emission quantities are multiplied by a generic pollutant-specific external cost factor in order to yield the additional external costs.

Additional external costs caused by the operation of the SCR

Step 1: A single dataset containing aggregated air emissions due to the processes SCR operation, ammonia provisioning, and catalyst disposal is taken from ecoinvent (2009). This data is based on the amount of NOx retained (in kg) and was therefore multiplied by the annual amount of NOx retained by the SCR of the exemplary coal-fired power plant.

Step 2: The default external cost factors per ton of pollutant emitted are taken from NEEDS (European Commission 2009, p. 7ff). It is important to note that these factors constitute EU-27 average values and thus do not take site dependent aspects (e.g. receptor distribution, meteorological conditions) into account. Multiplying the emission quantities by the external cost factors leads to the additional external costs as presented in Figure 2.

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External costs due to the operation

of the SCR

0.00 20000.00 40000.00 60000.00 80000.00 100000.00 120000.00 140000.00 160000.00 180000.00

CO2 CH4 N20 PM10 SO2 NOx SUM

E x ter n al c o sts [E u ro (2000 )]

Figure 2 – Annual external costs per pollutant and in total due to the operation of a SCR at a coal-fired power plant

As a result, the processes related to the SCR operation lead to additional external costs of 163 072 € per year. Compared to the external costs calculated in the CBA of chapter 3, the number is rather small. Owing to the assumed double counting, the actual figure is expected to be even lower.

CBA of the SCR including up- and downstream processes

The annual benefits are assumed to be reduced by 163 072 € due to the additional external costs caused by the SCR. Nonetheless, given the considerably positive result of the original CBA, this change in benefits does not affect the conclusion of the CBA. The result of the extended CBA is:

t t t t t t

Mio

Mio

− = = − = =

30

.

76

.€

*

(

1

.

03

)

2

.

9

.€

*

(

1

.

03

)

20 0 20 0

= 488.5 million € - 46 million € = 442.5 million € > 0 As a result, the evaluation of strongly beneficial projects, such as the installation of the SCR at the investigated coal-fired power plant, is hardly affected by including additional effects from the “next-best” upstream and downstream processes. Another factor that may influence the result of a CBA is the uncertainty connected to the calculation of external costs via EcoSenseWeb. For this reason, the following chapter analyses the influence of the EcoSenseWeb parameter settings on the quantified external costs.

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5 U

NCERTAINTY

-

I

NFLUENCE OF

E

CO

S

ENSE

W

EB

P

ARAMETER

S

ETTINGS ON THE

E

XTERNAL

C

OSTS

Influence of the EcoSenseWeb parameter settings on the quantified external costs

As it is demonstrated in the following, the calculation parameter settings of EcoSenseWeb have a considerable influence on the quantified external costs.

The EcoSenseWeb input data used for this analysis is identical to the input data in the CBA of chapter 3 without SCR installed. In order to yield the minimum and maximum quantifiable external costs, the parameters have been adjusted as presented in Tab. 5.

Tab. 5 EcoSenseWeb parameter settings for the calculation of the minimum (ESW_Min) and maximum (ESW_Max) external costs of a coal-fired power plant

Calculation parameters ESW_Min ESW_Max

Assessment of damages on human

health (Methodology Applied) SIA_D_PPM_Core SIA_E_PPM_AddSens

Background emission scenario,

situation in … 2010 2020

Meteorological Year avg future

Assessment of damages resulting

from climate change MDC – Regional Values(e.g. 7.3

2000/t CO2 emitted in 2010)

MDC – World Average Equity Weighted

(e.g. 19.1 €2000/t CO2 emitted in 2010)

Notes:

- SIA_D_PPM_Core: core set of DRFs; particles of different origin are treated differently

- SIA_E_PPM_AddSens: core set of DRFs is supplemented by additional sensitivity DRFs; equal treatment of particles from different origins

- MDC – Regional Values: marginal damage costs approach; differences in income levels across the world are not accounted for during the determination of climate change damages

- MDC – World Average Equity Weighted: marginal damage costs approach; different income levels in different parts of the world are accounted for, which leads to varying levels of climate change damages across the world

- Defining an own cost factor for the assessment of GHG emissions was excluded from the analysis, since it would allow putting virtually infinite costs or no cost at all on GHG emissions

The quantified external costs are presented in Figure 3.

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Minimum and maximum quantifiable external costs of a coal-fired power plant [€-Cent (2000) / kWh]

0.00 2.00 4.00 6.00 8.00 Climate change 0.6541 1.7305 Biodiversity 0.2069 0.1861 Building materials 0.0424 0.0424 Crops 0.0326 0.0438 Human health 1.4551 4.2248 ESW_Min ESW_Max

Figure 3 – Minimum and maximum quantifiable external costs of a coal-fired power plant, calculated using EcoSenseWeb 1.3

In case of the ESW_Min scenario, the quantified marginal external costs amount to 2.4 €-Cent2000 per kWhel, whereas in the ESW_Max scenario marginal external costs of 6.2 €-Cent2000 per kWhel are quantified. This means that the maximum value is roughly 2.6 times higher than the minimum value. As can be observed in Figure 3, the difference in external costs is mainly due to the categories climate change and human health. Regarding climate change, the difference can be explained by the inclusion or exclusion of equity weighting, which means accounting for income differences across the world when estimating climate change damages. In the ESW_Max scenario, additional DRFs for human health damages were employed, leading to higher external costs. Further, different kinds of particles are assigned an equal damage factor according to the ESW_Max scenario. In the ESW_Min scenario, by contrast primary particles are assigned more weight and secondary particles in the form of sulphates and nitrates are assigned less weight. Relatively high NOx emissions that are partly transformed into nitrates thus lead to higher external costs when particles are treated equally. Moreover, future background emissions and meteorological conditions are expected to cause higher external costs. In general, the results underline the importance of specifying the parameter settings when calculating external costs via assessment tools such as EcoSenseWeb.

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Influence of the EcoSenseWeb parameter settings on the result of the CBA

In this section, it shall be verified if the EcoSenseWeb parameter settings have an influence not only on the quantified external costs but also on the outcome of the CBA including the up- and downstream processes of the SCR. For this purpose, the minimum parameter settings as described in Tab. 5 are applied in order to yield the lower bound quantifiable environmental benefit of the SCR installation. Except for the parameter settings, all input data is equal to the data as described in chapter 3. In Figure 4, the quantifiable external costs without and with SCR are presented.

Minimum quantifiable external costs of a coal-fired power plant

without and with SCR [€-Cent (2000) / kWh]

0.00 0.50 1.00 1.50 2.00 2.50 3.00 Climate change 0.6541 0.6574 Biodiversity 0.2069 0.0852 Building materials 0.0424 0.0289 Crops 0.0326 0.0002 Human health 1.4551 0.7611

ESW_Min without SCR ESW_Min with SCR

Figure 4 – Minimum quantifiable external costs of a coal-fired power plant without and with SCR (including up- and downstream processes), calculated using EcoSenseWeb 1.3

Comparing the total quantifiable external costs between the scenario without SCR and with SCR yields an annual environmental benefit of 20.4 Mio. €2000. Integrating these benefits into the CBA formula leads to the following result:

t t t t t t

Mio

Mio

− = = − = =

20

.

264

.€

*

(

1

.

03

)

2

.

9

.€

*

(

1

.

03

)

20 0 20 0

= 321.7 million € - 46 million € = 275.7 million € > 0 Although the net present value is substantially lower than in the initial CBA, the investment into the SCR can once more be seen as advantageous from a public welfare point of view.

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6 C

ONCLUSION AND

O

UTLOOK ON

F

UTURE

R

ESEARCH

In order to promote the use of external costs and other impact assessment methodologies in policy decision-making, it is necessary to provide comprehensive quantitative data. In theory, it is therefore desirable to combine concepts like LCIA and external costs and to extend the current methodology by including further impact categories. This is also among the goals of the EXIOPOL project4.

In the current paper, a basic CBA approach was extended by integrating additional up- and downstream processes into the assessment framework. On the one hand, this leads to a more detailed analysis and can therefore be seen as an improvement. On the other hand, this simplified approach still has various limitations, such as the double counting of the SCR operation process, the generic emission and cost data that has been used, and the restricted amount of considered impacts. Further, it has been found that the inclusion of additional input data in the CBA has only a minor impact on the overall result since the benefits clearly outweigh the costs in the initial scenario. It can thus be questioned, if the added information that is gained justifies the additional effort of an extended analysis. Of course, the answer to this question depends on the particular case.

Applying a hybrid approach that combines EE IO tables and process-oriented LCA (Suh et al. 2003) can help extend the system boundaries and identify further relevant up- and downstream processes. This, in turn, enables to conduct a more detailed assessment study. In this perspective, the EE IO database that is being developed during EXIOPOL could be used for a more complete assessment of external costs from certain processes or products. However, the high degree of aggregation in EE IO tables in terms of space and processes is a drawback for the use in rather specific cases, such as the one in the present paper. Consequently, if information from EE IO tables is transferred to assessments at the micro level, the unspecific nature of this data has to be kept in mind.

In order to conduct more comprehensive external cost assessments, it would be interesting to analyse how the concepts of LCA, EE IO tables and external costs can be combined in impact assessment studies (at both the micro and the macro level). The aforementioned concepts are likewise connected to societal life cycle costing, as presented by Hunkeler et al. (2008). Societal life cycle costing is a conceptual framework for sustainability assessment and aims to combine information on economic, environmental and societal costs. As a consequence, the general aim of future research is to improve the methodology of societal life cycle costing and to apply the findings to a case in the energy sector.

4 For more information refer to http://www.feem-project.net/exiopol/, last visited : 10/06/07

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7 B

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Hunkeler, D., Lichtenvort, K., Rebitzer, G., (Editors) (2008), Environmental Life Cycle Costing. CRC Press. ISBN: 1-4200-5470-8.

Kuik, O., Brander, L., Nikitina, N., Navrud, S., Magnussen, K., Fall, E.H. (2008), "Deliverable 3.2 of the CASES project: WP3 Report on the monetary valuation of energy related impacts on land use changes, acidification, eutrophication, visual intrusion and climate change". Institute for Environmental Studies (IVM), VU University Amsterdam, Amsterdam. p. 130.

Melichar, J., Ščasný, M., Hunt, A., Navrud, S. (2009), "Cost-benefit analysis – Review of the Methodology and Practical Step-By-Step Guidelines for Applications in the Energy Sector - Deliverable 4.1 - RS 3a of the NEEDS project". CUEC, UBATH and SWECO, Prague, Bath and Stockholm. p. 69. Online available at: http://www.needs-project.org/2009/Deliverables/Rs3a%20D4.1_final.doc. Pearce, D., Atkinson, G., Mourato, S. (2006), Cost-Benefit Analysis and the Environment. OECD, Paris.

ISBN: 92-64-01004-1.

Preiss, P., Klotz, V. (2008), "EcoSenseWeb V1.3 - User’s Manual & “Description of Updated and Extended Draft Tools for the Detailed Site-dependent Assessment of External Costs”.". Institute of Energy Economics and the Rational Use of Energy (IER), University of Stuttgart, Stuttgart, Germany. p. 63.

Pye, S., Holland, M. (2007), "Evaluation of the costs and benefits of the implementation of the IPPC Directive on Large Combustion Plant". AEA Energy and Environment, Harwell, UK. p. 28. Online available at: http://www.cafe-cba.org/assets/ippc_ec_lcplant.pdf.

Suh, S., Lenzen, M., Treloar, G.J., Hondo, H., Horvath, A., Huppes, G., Jolliet, O., Klann, U., Krewitt, W., Moriguchi, Y., Munksgaard, J., Norris, G. (2003), "System Boundary Selection in Life-Cycle Inventories Using Hybrid Approaches". Environmental Science & Technology, 38 (3), p. 657-664.

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Internet pages

EGTEI 2005

“Costs for NOx abatement techniques (28/04/2005)”,

Centre Interprofessionnel Technique d’Etudes de la Pollution Atmosphérique (CITEPA) - Expert Group on Techno-Economic Issues (EGTEI): http://www.citepa.org/forums/egtei/egtei_doc-Comb-Ind.htm, last visited: 10-03-30

Software & databases

EcoSenseWeb 1.3, software for the calculation of external costs of an emission source. Developed at the IER (Institute of Energy Economics and the Rational Use of Energy), University of Stuttgart. Online available at: http://ecosenseweb.ier.uni-stuttgart.de/, last visited: 10-03-31

Ecoinvent 2009, ecoinvent data v2.1, database of the Swiss Centre for Life Cycle Inventories, dataset used: “NOx retained, in SCR, GLO, [kg] (#882)”, online access via http://www.ecoinvent.com, last visited 10-03-31

www.needs-project.org www.externe.info http://ecosenseweb.ier.uni-stuttgart.de/io_data.html, last visited: 10/ http://www.feem-project.net/exiopol/ http://circa.europa.eu/Public/irc/env/ippc_rev/library?l=/emissions_trading/strakeholder_february&vm=detailed&sb=Title http://ftp.jrc.es/eippcb/doc/lcp_bref_0706.pdf http://www.needs-project.org/2009/Deliverables/RS1a%20D6_1%20External%20costs%20of%20reference%20tech nologies%2024032009.pdf. http://www.needs-project.org/2009/Deliverables/Rs3a%20D4.1_final.doc available at: http://www.cafe-cba.org/assets/ippc_ec_lcplant.pdf. Costs for NOx abatement techniques (28/04/2005)”, http://www.citepa.org/forums/egtei/egtei_doc-Comb-Ind.htm available at: http://ecosenseweb.ier.uni-stuttgart.de/, last visited: 10-03 ss via http://www.ecoinvent.com,

References

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