Environmental Externalities of
 Energy Options - Basics and
        Applications



    Y. Matsuki
    August 7, 2009
    ...
Different energy systems
 Coal
 Oil
 Gas
 Nuclear
 Biomass
 Hydro
 Wind
 Photovoltaic
Emissions from coal energy
 CO2
 Sulphates and nitrates from SO2and
 NOx emissions
 Particulate matter from Primary
 parti...
Impacts of coal energy
 CO2
 Climate change
 Sulphates and nitrates from SO2and NOx emissions
 Increased mortality and mor...
Severity of the impacts of coal
energy
  The severest --- !!!
  Severe, but not as the severest --- !!
  Severe, but not a...
Severity of the impacts of coal
energy
  CO2 Climate change
  !!!
  Sulphates and nitrates, mortality and morbidity
  !!!
...
Impacts from oil energy
 CO2, sulphates and nitrates
 !!! – same as coal
 Particulates, ozone
 !! – same as coal
 Oil impo...
Impacts from gas energy
 CO2, nitrates!!! - Same as coal, but no
 salphates, and no particulate matter)
 Ozone
 !! – same ...
Impacts from other energy systems
 Nuclear: Severe accident, !-!!!
 Nuclear: Reprocessing, !!
 Nuclear: Waste disposal, !
...
How such tables were made?
 Assessment of health and
 environmental impacts from energy
 systems
 Assessment of damage
 co...
Summary of Cost Estimates in mECU/kWh
                    Canada                                France                    ...
Summary of Cost Estimates in mECU/kWh (continued)
                  Greece                                    US          ...
Why those tables were made?
 Electricity Pricing in the US
 EU expansions in the 1990s
 Preparation for the expansion of
 ...
What will you make, if you have
such an information with you?
  Attract somebody to do something, such as
  Make the Gover...
How to use the results?
Distinguishing externalities
 Emission of discharge
 Change in concentration
 Impact
 Damages
 Externalities
Distinguishing externalities
 CO2
 Increased concentration of CO2 in atmosphere
 Estimates are imprecise but impacts are t...
SO2
Formation and dispersion of sulphates, for example
Increased risk of morbidity and mortality from
respiratory problems...
Radio-nuclides (in the event of a nuclear power plant
accident)
Increases in radionuclide concentrations for thousands
of ...
Noise from wind turbines
Increase in noise levels at locations near
wind farm
Undesirable effects on auditory senses
Willi...
Reduced flow of waterfall caused by dam
Reduced flow of waterfall caused by dam
Reduced visual aesthetics of waterfall
Eco...
How to internalize it
 Name of the impact and damage
 Way in which damages are
 internalized
 Examples
How to internalize it
 Occupational injury, including long
 term health effects
 Wages and health insurance
 Some portion ...
Damage to aquatic life from mine runoff
Regulations that set standards on allowable
discharges
Many countries have water r...
Human health effects from air polltution
Regulations on discharges and/or on
maximum local concentration
National Ambient ...
Effects of global climate change due
to CO2
Taxes
Norway, for example, has carbon
taxes
Damage from oil spills
Payments of fines
In the USA, the Oil Pollution Act
requires the responsible party to pay
the cost ...
Effects of nuclear power plant
accident
Insurance requirements
In the USA, the Price-Anderson Act
requires utilities to ca...
Ecological and human health effects from
SO2 emissions
Tradable emission permits
In the USA, there is trading of SO2 emiss...
All types
Voluntary installation of pollution
abatement equipment
Many electrical utilities install scrubbers,
electrostat...
If you want to start it, what you
have now?
  Method to learn
  Computer codes to make wide range
  of the assessment
    ...
What is “externality”?
 Values that are not included in the market price
 of electricity
 Damages to Human health (death, ...
What else will be shown now?
 How to calculate how many people
 die many years after by the air
 pollution
 How to calcula...
Top issue
 Loss of life expectancy for chronic
 mortality from particles
 [Dockery et al 1993, Pope et al 1995]
 have foun...
How can you calculate the externalities?
How to calculate the monetary
value of the health impacts

D=          (x)·f(x,C(x,Q))·Uv(x) dx
     impact of Area
D: dam...
That’s it?
  No.
  What’s been shown is the basic
  method for students.
  Then, what comes next?
  The next comes with th...
Can we really make the Ukraine
Case Study?
 We do have emission data from
 power plants from this year
 And, we have the m...
Olga Brondzya’s Thesis
 Trypilska Power Station in Ukrainka
 Using SimPact Computer Code for 50
 km distance + 1000 km dis...
Emissions
Trypilska Power Station in Ukrainka
Pollutants        Tons/year


PM10              21,951
                  (50...
Map around Ukrainka (<50km)
Simplified Gaussian Plume Model in SimPact
              for 50 km radius
Uniform World Model
Damage Cost total in UAH
  With Ukrainian Unit Cost:
    = 0.30 UAH/kWh

    Electricity price 0.2872 UAH/kWh
Is it extern...
:( yet we don’t know….
 The bigger power plants in Ukraine
 The different populations and their
 distributions in the othe...
What do you think about those?
Ukraine-specific externalities,
from the recent news topics
 Coal power
   Accident record of coalmines
   Rehabilitation ...
Issues in Ukraine
 Is coal energy cheap?
   Delayed respiratory disease
   How can the people’s perception of the
   risk ...
General ways by which damages
can be internalized in the prices
  Occupational injury – wages and health
  insurance
  Hum...
Available Learning Resource
 Guideline documents
   IAEA (1999), “Health and environmental impacts
   of electricity gener...
Conclusions
 Externalities of energy generation systems
 are proven to be significant.
 There is a developed methodology t...
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Different Energy Systems and Impacts - Qualitative Discussions

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AACIMP 2009 Summer School lecture by Yoshio Matsuki. "Environmental Externalities of Energy Options - Basics and Applications" course. 1st hour.

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Different Energy Systems and Impacts - Qualitative Discussions

  1. 1. Environmental Externalities of Energy Options - Basics and Applications Y. Matsuki August 7, 2009 Presented at the Summer School of the NTUU “KPI”
  2. 2. Different energy systems Coal Oil Gas Nuclear Biomass Hydro Wind Photovoltaic
  3. 3. Emissions from coal energy CO2 Sulphates and nitrates from SO2and NOx emissions Particulate matter from Primary particulate emissions Ozone formed from NOx Mining Coal transport by rail and truck
  4. 4. Impacts of coal energy CO2 Climate change Sulphates and nitrates from SO2and NOx emissions Increased mortality and morbidity Particulate matter from primary particulate emissions Increased mortality and morbidity Ozone formed from NOx Increased morbidity and possibly increased mortality risk Mining Illness from coal dust Injury and deaths from mining accidents Coal transport by rail and truck Injury and death from accidents Air pollution from trucks Road pavement damage
  5. 5. Severity of the impacts of coal energy The severest --- !!! Severe, but not as the severest --- !! Severe, but not as the above two --- !
  6. 6. Severity of the impacts of coal energy CO2 Climate change !!! Sulphates and nitrates, mortality and morbidity !!! Particulate matter, mortality and morbidity !! Ozone, morbidity and possibly mortality !! Mining, illness from the dust !! Mining, injury and death from accidents !! Coal transport by rail and truck, injury and death from accidents !! Coal transport by truck, air pollution from truck ! Coal transport by truck, road pavement damage !
  7. 7. Impacts from oil energy CO2, sulphates and nitrates !!! – same as coal Particulates, ozone !! – same as coal Oil import Energy security costs !! Oil spill Damage to aquatic life !
  8. 8. Impacts from gas energy CO2, nitrates!!! - Same as coal, but no salphates, and no particulate matter) Ozone !! – same as coal Facility/pipeline leakage Damage from accidents ! to !! Climate change !
  9. 9. Impacts from other energy systems Nuclear: Severe accident, !-!!! Nuclear: Reprocessing, !! Nuclear: Waste disposal, ! Biomass: Nitrates from NOx, !! Biomass: Particulate matters, !! Biomass: Ozone, !! Biomass: Feedstock transport, !! Hydro: Land use, ! To !!! Wind: Wind turbine operation, ! Photovoltaic: Emissions from material production, !
  10. 10. How such tables were made? Assessment of health and environmental impacts from energy systems Assessment of damage cost/externality of those systems So, actually there are many numbers, pictures and tables, together with arguments behind.
  11. 11. Summary of Cost Estimates in mECU/kWh Canada France Germany Pub. Occ. Env Gw Pub Occ. Env. Gw. Pub. Occ Env. Gw . . . . . Coal 2.3 nq 53 nq 0.5 29 8.4 Lignite 10.5 Oil 69 nq 0.7 16 16.5 Natural 12 nq 0.1 8 3.0 Gas Nuclear 0.01- 2.5 0.07 0 0 3.8 0.05 Wind 0.2 Hydro Photo 2.7 Voltaic Pub. public impacts Occ. occupational impacts Env. Environmental (buildings, crops, ecosystems,…), excluding global warming Gw. Global warming nr not reported nq not quantified
  12. 12. Summary of Cost Estimates in mECU/kWh (continued) Greece US Russia Pub. Occ. Env. Gw. Pub. Occ. Env Gw Pub Occ. Env. Gw. . . . Coal 0.52 nr 1.1 Lignite 20 0.30 0.66 38 Oil 10 0.17 0.95 21 0.15 nr 0.21 Natural 2.4 0.17 0.66 5.8 0.01 nr Gas 1 Nuclear 0.17 0.4 0.26 -4 Wind 0.84 0.09 1.2 0.2 Hydro 1.2 3.8 0 0.14 Photo Voltaic Pub. public impacts Occ. occupational impacts Env. Environmental (buildings, crops, ecosystems,…), excluding global warming Gw. Global warming nr not reported nq not quantified
  13. 13. Why those tables were made? Electricity Pricing in the US EU expansions in the 1990s Preparation for the expansion of electricity market within the EU Growing concerns on environmental issues and the global warming UN sustainable development programs
  14. 14. What will you make, if you have such an information with you? Attract somebody to do something, such as Make the Government and the Public understand the current situation Convince the sponsors to invest more money on cleaner energy Guide people to take actions for creating the better energy and environmental policy Ecology Tax Tradable Permission Emission control devices Any more new policy, strategy, mechanism
  15. 15. How to use the results?
  16. 16. Distinguishing externalities Emission of discharge Change in concentration Impact Damages Externalities
  17. 17. Distinguishing externalities CO2 Increased concentration of CO2 in atmosphere Estimates are imprecise but impacts are thought to include changes in coastal ecosystems and in built environment, changes in agriculture production, and possible starvation due to increased frequency of floods and droughts Economic value of impacts In most countries, non of the damages are internalized; thus, all of the damages are externalities
  18. 18. SO2 Formation and dispersion of sulphates, for example Increased risk of morbidity and mortality from respiratory problems due to inhalation of sulphates Economic value of expected increase in morbidity and mortality. This value includes decreased, or lost, quality of life, not just medical costs and lost wages or productivity In regions without internalization of these damages, the externality equals the damages. In the USA, with trading of SO2 emission permits, an indeterminate portion of the damages is internalized.
  19. 19. Radio-nuclides (in the event of a nuclear power plant accident) Increases in radionuclide concentrations for thousands of kilometers Increased risk of morbidity and mortality from certain cancers Economic value of expected increase in cancers In the USA, a portion of the damages is internalized through the Price-Anderson Act
  20. 20. Noise from wind turbines Increase in noise levels at locations near wind farm Undesirable effects on auditory senses Willingness of individuals to pay to avoid noise, e.g. through real estate prices of land near wind farm All of these damages are externalities because there is no market mechanism that internalizes them
  21. 21. Reduced flow of waterfall caused by dam Reduced flow of waterfall caused by dam Reduced visual aesthetics of waterfall Economic value of reduced aesthetics, e.g. as estimated in a contingent valuation study of individuals’ willingness to pay None of the damages are internalized; thus, all of the damages are externalities
  22. 22. How to internalize it Name of the impact and damage Way in which damages are internalized Examples
  23. 23. How to internalize it Occupational injury, including long term health effects Wages and health insurance Some portion of the increased risks of mining is internalized in higher wages and in medical insurance benefits provided by employers, who then pass these added costs to the buyer of the fuel
  24. 24. Damage to aquatic life from mine runoff Regulations that set standards on allowable discharges Many countries have water regulations. However, these regulations may over or under regulate from an efficiency standpoint. Also, if there is non compliance, externalities could occur.
  25. 25. Human health effects from air polltution Regulations on discharges and/or on maximum local concentration National Ambient Air Quality Standards in the USA and similar regulations in many other countries. These regulations reduce the externalities. However, standards are no easy solution for eliminating externalities.
  26. 26. Effects of global climate change due to CO2 Taxes Norway, for example, has carbon taxes
  27. 27. Damage from oil spills Payments of fines In the USA, the Oil Pollution Act requires the responsible party to pay the cost of an oil spill. In the case of a small oil spill, the responsible party may not be known, so the damages would not be internalized.
  28. 28. Effects of nuclear power plant accident Insurance requirements In the USA, the Price-Anderson Act requires utilities to carry insurance that covers them, to a limit, in the event of a nuclear power plant accident
  29. 29. Ecological and human health effects from SO2 emissions Tradable emission permits In the USA, there is trading of SO2 emission permits. Also, there is trading of NOx emission permits in southern California. Trading does not completely internalize externalities because their magnitude depends on the location of the emissions and the affected environment and population. Also, emission caps are not always set at their most efficient level.
  30. 30. All types Voluntary installation of pollution abatement equipment Many electrical utilities install scrubbers, electrostatic precipitators, etc. Plant operators may not voluntarily install pollution abatement equipment because it increases their costs. Alternatively, they may install equipment as a hedge against future, more stringent regulations.
  31. 31. If you want to start it, what you have now? Method to learn Computer codes to make wide range of the assessment PM10, SO2, NOx, salfates, nitrates Global warming Damage cost, external cost, externality Examples from elsewhere A few examples with NaUKMA students
  32. 32. What is “externality”? Values that are not included in the market price of electricity Damages to Human health (death, injury, illness) Damages to Biological resources (crops/vegetation, forests, fisheries, aquatic, terrestrial, groundwater) Climate change, visibility Policy needed to secure energy supply
  33. 33. What else will be shown now? How to calculate how many people die many years after by the air pollution How to calculate the Grivna/Euro equivalent monetary value for those deaths
  34. 34. Top issue Loss of life expectancy for chronic mortality from particles [Dockery et al 1993, Pope et al 1995] have found positive correlations between exposure to particles and total mortality
  35. 35. How can you calculate the externalities?
  36. 36. How to calculate the monetary value of the health impacts D= (x)·f(x,C(x,Q))·Uv(x) dx impact of Area D: damage cost (Euro, US dollars, UAH) (x): population density (person/m2) f(x,C(x,Q)): Exposure-Response Function cases/(year.person. g/m3) Uv(x): unit cost (Euro/cases) C(x,Q): Concentration of the pollution ( g/m3) Q: Emission of the pollution ( g/year) x: Distance from the emission source (m)
  37. 37. That’s it? No. What’s been shown is the basic method for students. Then, what comes next? The next comes with the national case study, Really?
  38. 38. Can we really make the Ukraine Case Study? We do have emission data from power plants from this year And, we have the methodology to assess the external costs.
  39. 39. Olga Brondzya’s Thesis Trypilska Power Station in Ukrainka Using SimPact Computer Code for 50 km distance + 1000 km distance Ukraine region
  40. 40. Emissions Trypilska Power Station in Ukrainka Pollutants Tons/year PM10 21,951 (50 % of TSP emission 10,975 tons/year) NOx 11,108 SO2 40,910
  41. 41. Map around Ukrainka (<50km)
  42. 42. Simplified Gaussian Plume Model in SimPact for 50 km radius
  43. 43. Uniform World Model
  44. 44. Damage Cost total in UAH With Ukrainian Unit Cost: = 0.30 UAH/kWh Electricity price 0.2872 UAH/kWh Is it externality?
  45. 45. :( yet we don’t know…. The bigger power plants in Ukraine The different populations and their distributions in the other cities and the regions People’s Willingness to Pay for their lives, in different regions, ages, education levels, incomes, orientations….
  46. 46. What do you think about those?
  47. 47. Ukraine-specific externalities, from the recent news topics Coal power Accident record of coalmines Rehabilitation of old facilities Global warming Nuclear power Social rehabilitation after Chernobyl accident People’s perceived risk Energy supply policy and politics
  48. 48. Issues in Ukraine Is coal energy cheap? Delayed respiratory disease How can the people’s perception of the risk be internalized? Expert risk vs. public perception How large is the externality to import energy? Economic rent of the cartel Market disruption
  49. 49. General ways by which damages can be internalized in the prices Occupational injury – wages and health insurance Human health effect from air pollution – Regulations on discharge or local concentration Ecological and human health effects from SO2 – Tradable emission permits Damage to aquatic life from mine runoff – regulations Global climate change – taxes All types – pollution abatement equipment
  50. 50. Available Learning Resource Guideline documents IAEA (1999), “Health and environmental impacts of electricity generation systems: procedures for comparative assessment”, IAEA Technical Report Series No. 394 Computer software SimPact by the IAEA EcoSence by the ExternE (Stuttgart U.) Previous projects and the reports ExternE ORNL/RFF IAEA
  51. 51. Conclusions Externalities of energy generation systems are proven to be significant. There is a developed methodology to calculate energy externalities, with transparent and verifiable step by step approach. Regarding some additional externalities in Ukraine (on energy security, coal power, people’s perception upon the catastrophic accident), the necessity to calculate and include them into the price of electricity is very strong.

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