10.

38, -
.
10.39 ,
- .
As Figure 10.38 shows, in this scenario a higher share of the production mix is attributable to new
lignite plants. As a result, Figure 10.39 shows CO2 emissions from the Bulgarian power sector are
substantially higher in this scenario than in the "current policies" case.
10.40 ,
LRMC ,
.
Figure 10.40 shows that prices converge on average to slightly below the LRMC of a new lignite plant
in this scenario, although prices show some volatility from year-to-year.

10.38
. ()
10.39
CO2 Emissions from the Power Sector

10.9.
- ,
,
, ,
CCS. , -
, .
The scenarios presented above assume a range of new generation technologies are available for
development in the regional power market, including generation fired by gas, coal and lignite, as well
as generation capacity with or without CCS. However, in reality a narrower range of technologies may
be available to power market participants, which we reflect in two alternative scenarios below.
,
, ,
.
,
.
In the first scenario, keeping all other assumptions the same as in the "current policies" case, we
assume that CCS technology fails to become commercially viable in the regional power market. This
scenario reflects the considerable uncertainty regarding the long-term costs of this technology, and the
uncertainties regarding its performance for large scale power generation.

 ,
, ,
(
).
-
, ,
15
.
In the second scenario, keeping all other assumptions the same as in the "current policies" case, we
assume that no new coal-fired generation capacity can be developed in the regional market (i.e. no
new lignite and not new steam coal). This scenario reflects the possibility that reserves of locally
produced coal may be more limited than we assume in our other scenarios,1 or that the environmental
constraints that currently prevent the development of new coal power stations in the EU15 begin to
bind in CEE markets too.

10.9.1.

CCS generation fails to become commercially viable

As Figure 10.41 shows, in this scenario instead of building new CCS generation in the period after
2040, the model chooses to continue developing unabated lignite capacity, with some new gas-fired
CCGT capacity, as in the "current policies" case. This is mirrored in the wider regional market, as
Figure 10.42 illustrates, with a higher share of regional generation capacity fired by coal without CCS.

10.41
Installed Capacity vs. Peak Load
,
100 .
, ,
- ( ), .
,
, . .
Based on information from Euracoal, we estimate that Bulgaria's local lignite resources are sufficient to sustain current levels
of production for over 100 years. However, we understand from discussions with BEH that the calorific value of locally
produced lignite is falling over time as more expensive resources (per unit of energy content) are exploited to meet demand.
It is also possible that it will not be economically or politically possible to develop some of the resources Euracoal estimates
are available, e.g. due to the environmental impact of opencast mining.

 10.42
Cumulative Modelled Investment by Technology in the Regional Market
The lack of CCS technology means unabated fossil fuels, in particular lignite, account for
a larger share of the generation mix than in the current policies case, as Figure 10.43
illustrates. As a result, CO2 emissions are significantly higher in this scenario, as Figure
10.44 shows.
10.43
Production vs. Energy Demand (GWh)

10.44
CO2 Emissions from the Power Sector
As Figure 10.45 shows, Bulgarian baseload prices are similar to the current policies
scenario in this near term, although they are somewhat lower in the period from 2030. We
think this arises because the models inability to develop CCS technology towards the end of
the modelling horizon means it develops more unabated lignite in the near term, creating a
larger supply margin. Towards the very end of the modelling horizon, i.e. post-2045, prices
are slightly higher as CCS technology is not available, which is cheaper by the end of the
modelling horizon with current policies commodity prices than unabated lignite.
10.45
Baseload Prices vs. LRMC of New Lignite (Nominal /MWh)

10.9.2.

New lignite and unabated coal-fired generation are infeasible

As Figure 10.46 shows, without new unabated coal-fired generation capacity, or any new
lignite capacity at all, the model chooses mainly to develop new gas-fired CCGTs, with a
small amount of new steam coal-fired IGCC capacity with CCS coming online towards the
end of the modelling horizon. These investment patterns are mirrored in the regional
market, as Figure 10.47 shows.
Figure 10.46 also shows that the models inability to construct new lignite plants makes it
economical to keep the existing lignite fleet online for as long as technically possible,
which we assume is 60 years from each units commissioning date.
10.46
Installed Capacity vs. Peak Load
10.47

Cumulative Modelled Investment by Technology in the Regional Market

10.48 ,

Figure 10.48 shows that in this scenario existing lignite plant accounts for a higher share of
the generation mix in the near-term as they retire later in this scenario, and that gas-fired
generation also plays a larger role in the Bulgarian power market, especially towards the end
of the modelling horizon. Reduced production from coal technologies reduces CO2 emissions
compared to the current policies scenario in the near-term, but the lack of CCS technology
means emissions continue to rise, even towards the end of the modelling horizon, as Figure
10.49 shows.
10.48
Production vs. Energy Demand (GWh)
10.49
CO2 Emissions from the Power Sector

10.50 ,
.
Figure 10.50 shows that in this scenario, prices converge to close to the LRMC of a new gasfired CCGT.

10.50
Baseload Prices vs. LRMC of New Gas-Fired CCGTs (Nominal /MWh)

10.10.

.
CO2 ,
,

.
In this chapter, we defined a range of scenarios regarding the long-term outlook for the
regional power market into which the Belene plant will sell its output. These scenarios
examine long-term risks regarding fuel and CO2 prices due to policy uncertainty,
uncertainty regarding conditions in world gas markets, and scenarios around the availability
of coal and CCS generation technologies to new investors in the regional power market.

 ,
...., -
.
Across all scenarios described in this chapter, long-run baseload power prices converge to
a level close to the LRMC of new entry, albeit the least cost new entrant technology varies
across the scenarios. Hence, in the long-run, this modelling demonstrates that the
revenues captured by the Belene plant depend to some extent on the costs of constructing
and operating the alternative baseload generation technologies with which it competes.
We therefore show some additional sensitivity analysis around these assumptions in
Appendix B.