Challenges for hydropower-based nationally determined contributions: a case study for Ecuador

ABSTRACT

Hydropower is the dominant renewable energy source to date, providing over two-thirds of all renewable electricity globally. For countries with significant hydropower potential, the technology is expected to play a major role in the energy transition needed to meet nationally determined contributions (NDCs) for greenhouse gas (GHG) emission reductions as laid out in the Paris Agreement. For the Republic of Ecuador, large hydropower is currently considered as the main means for attaining energy security, reducing electricity prices and mitigating GHG emissions in the long-term. However, uncertainty around the impacts of climate change, investment cost overruns and restrictions to untapped resources may challenge the future deployment of hydropower and consequently impact decarbonization efforts for Ecuador’s power sector. To address these questions, a partial equilibrium energy system optimization model for Ecuador (TIMES-EC) is used to simulate alternative electricity capacity expansion scenarios up to 2050. Results show that the share of total electricity supplied by hydropower in Ecuador might vary significantly between 53% to 81% by 2050. Restricting large hydropower due to social-environmental constraints can cause a fourfold increase in cumulative emissions compared to NDC implied levels, while a 25% reduction of hydropower availability due to climate change would cause cumulative emissions to double. In comparison, a more diversified power system (although more expensive) which limits the share of large hydropower and natural gas in favour of other renewables could achieve the expected NDC emission levels. These insights underscore the critical importance of undertaking detailed whole energy system analyses to assess the long-term challenges for hydropower deployment and the trade-offs among power system configuration, system costs and expected GHG emissions in hydropower-dependent countries, states and territories.

Key policy insights

• Ecuador’s hydropower-based NDC is highly vulnerable to the occurrence of a dry climate scenario and restrictions to deployment of large hydropower in the Amazon region.

• Given Ecuador’s seasonal runoff pattern, fossil-fuel or renewable thermoelectric backup will always be required, whatever the amount of hydropower installed.

• Ecuador’s NDC target for the power sector is achievable without the deployment of large hydropower infrastructure, through a more diversified portfolio with non-hydro renewables.

KEYWORDS:

• Hydropower
• NDC
• Ecuador
• energy modelling
• renewable energy

Acknowledgments

The authors thank Gabrial Anandarajah and Yacob Mulugetta for helpful comments on an earlier version of this paper. Profound appreciation is extended to the Ecuadorian Secretariat of Higher Education, Science, Technology and Innovation (SENESCYT) for providing monetary support to Pablo Carvajal for his doctoral studies at UCL Energy Institute.

Disclosure statement

No potential conflict of interest was reported by the authors.

ORCID

Pablo E. Carvajal http://orcid.org/0000-0003-0202-2695

Notes

1 Recurring uncertainty is characterised by conditions that are periodically recurring and in which knowing the past or current value of the parameter does not resolve the uncertainty for the future.

2 Total hydropower potential is 22.1 GW, of which 5.1 GW have already been installed (of which 0.7 GW is under construction); 13 GW is considered as the effective remaining potential that can be tapped at reasonable costs; and 4 GW have been determined as unfeasible due to environmental restrictions (within natural parks or high biodiversity areas).

3 Techno-economically feasible hydropower potential, in the Ecuadorian context, refers to the total capacity of hydropower projects with technologically feasible construction complexity at reasonable or industry-standard investment costs.

4 Availability factor, a ratio of hydropower production over the maximum theoretical production, subject to a defined time period.

5 A Representative Concentration Pathway (RCP) is a greenhouse gas (GHG) concentration trajectory adopted by the IPCC (RCPs: RCP2.6, RCP4.5, RCP6, and RCP8.5). The number refers to the radiative forcing (in W/m²) relative to pre-industrial levels expected by the end of the 21st century. The RCP4.5, is considered as a middle-of-the-road pathway that is consistent with radiative forcing of +4.5 W/m2 by 2100 (Moss et al., 2010).

6 Constraining the model to use discrete sizes instead of a linear continuous expansion path, a method known colloquially as ‘lumpy investment’, allows to capture the granularity of investments of large infrastructure.

7 Hydrothermal system refers to thermoelectric power plants that operate synchronously with hydroelectric plants in order to increase the amount of energy that the system can guarantee by reducing deficits in dry seasons and avoiding spillage in wet seasons.

8 Average generation cost is understood is the net present value of the unit-cost of electricity over the lifetime of a generating asset.