Assessing bulk energy transport options by taking into account externality constraints

Abstract

This paper presents a method to compare and evaluate alternatives for bulk energy transport to meet evolving needs for electric energy consumption. In particular, it offers insight into the cost and environmental tradeoffs between mine mouth generation with electric transmission technologies and transporting primary energy resources with generation near the customer. A straightforward bulk energy transport model is constructed to address relevant combinations of environmental and other constraints, fuel and capital costs, and advanced technologies. The model uses a life cycle analysis framework and transforms externalities in dollars to compute social as well as private costs. Uncertainties are explored in a sensitivity analysis. The best alternative for bulk energy transport depends on the amount of energy to be transported, the distance, the initial energy source, existing infrastructure, and externalities such as air pollution, safety, noise, and electromagnetic fields.