Power Integrated Resource Plan PWP Presentation

Transcription

1 Power Integrated Resource Plan PWP Presentation Community Meeting #1 Pasadena Central Library July 18, 2018

2 POWER INTEGRATED RESOURCES PLAN: PWP PWP ACCOMPLISHMENTS & PROGRAMS 2

3 Renewable and Coal Annual Production 80% Eligible Renewable Coal 70% 67% 65% 60% 50% 40% 30% 60% 61% 54% 56% 52% 48% 44% 40% 38% 34% 32% 31% 27% 28% 29% 24% 24% 20% 16% 10% 0% 2% 8% 8% 9% 3

4 Green Power Options This is a voluntary program > Contributions go towards enabling PWP to bring in additional renewable power and reduces the city s dependence on coal Options > Residential Green Power (on a monthly basis) $5 extra for 200 kwh, or $10 extra for 400 kwh, or 2.5 extra for every kwh of actual usage > Commercial Green Power (on a monthly basis) $25 extra per block of 1000 kwh, or 2.5 for every kwh of actual usage 4

5 POWER INTEGRATED RESOURCES PLAN: PWP 2018 IRP BACKGROUND & GOALS 5

6 What is an IRP? IRP Details > The IRP serves as a blueprint for PWP to deliver reliable, environmentally responsible electricity service at competitive rates over a 20-year planning period > Recent Past IRPs City Council adopted 2009 IRP 3/16/2009 City Council adopted 2012 IRP 3/5/2012 City Council adopted 2015 IRP 6/22/2015 IRP Development > IRPs are evolving documents IRP will be updated every 3-5 years > Resources not considered or picked up today might be picked up in future IRPs 6

7 2018 IRP vs. Previous IRPs Previous IRPs 2018 IRP Not mandated by State and used to develop to plan for SB 350 Mandate with prescriptive requirements future energy needs Developed with Community Input Developed with Community Input No strict timeline Due by January 1, 2019 Updated every two-three years Mandatory five-year update Final product was either a detailed presentation or a report Mandatory detailed report, specific considerations, and prescribed tables 7

8 Key Issues for 2018 IRP SB 350 compliance > GHG emission reduction goals/alternatives > RPS goals/alternatives > Impact of transportation electrification > Impact on Disadvantaged Communities Meet reliability requirements Future of the Intermountain Power Plant ( IPP ) Natural Gas Repower Review of cost effective energy storage, demand response, energy efficiency, etc. Criteria of the Balanced Scorecard > Balancing these important issues with reliability, cost and environmental stewardship > A more detailed scorecard is being developed with input from the Power IRP Stakeholder Technical Advisory Group 8

9 IRP Scorecard Elements Need to find a balance between: > Reliability > Cost > Stability > Environment 9

10 POWER INTEGRATED RESOURCES PLAN: PWP REGULATORY REQUIREMENTS 10

11 Regulations CAISO Reliability Requirements > LCR, System RA, Flex RA SB350: 2015 > 50% RPS by 2030 > Requires IRP SB32 & AB32 > Cap and Trade > GHG Reductions SB100: Proposed Bill in 2018 > Potential for 100% non-carbon emitting resources > phase out of fossil fuel generation 11

12 SB 350 Requirements Mandates an IRP for utilities with load > 700 GWh Due (and approved) before 1/1/19 > IRP written document/report > 4 Required Tables > Supplemental Information > At least one planning scenario that meets the POU IRP requirements Compliance with PUC 9621» 40% reduction in greenhouse gases by 2030» 50% RPS by

13 POWER INTEGRATED RESOURCES PLAN: PWP 2018 IRP PROCESS 13

14 2018 IRP Tentative Schedule MILESTONE TIMING PWP 2018 IRP KICKOFF MEETING SEPTEMBER IRP VENDOR SELECTION MARCH 2018 FORM COMMUNITY STAKEHOLDER GROUP MARCH 2018 COMMUNITY STAKEHOLDER GROUP MEETINGS APRIL 2018-SEPTEMBER 2018 PUBLIC MEETINGS JULY-AUGUST 2018 IRP DRAFT REPORT SEPTEMBER 2018 IRP COMPLETE OCTOBER 2018 FINAL IRP PRESENTATION TO EAC, MSC AND CITY COUNCIL NOV/DEC

15 2018 Power IRP Consultant Contracted with Northwest Economic Research LLC ( NWER ) > Subcontractor Siemens/Pace (developed 2009 and 2012 IRP) Lon Peters, the owner of NWER was the former IRP Administrator at Glendale Water and Power Over 30 years of experience 15

16 2018 IRP Outreach Efforts The City Manager s Stakeholder Technical Advisory Group ( STAG ) formed > To represent a cross section of all ratepayer categories > Provide input/direction on the IRP analysis and portfolio selection Public Outreach > Community Meetings Date Time Location 7/18/ PM Pasadena Central Library 8/23/ PM Hastings Ranch Library > Power IRP Survey posted online 4/30/18 Periodic Updates to MSC, EAC and City Council Recommendations to EAC, MSC prior to City Council Approval 16

17 2018 IRP- Stakeholder Group The Stakeholder Technical Advisory Group is made up of a diverse group of 16 Customers and City representatives 2015 & 2018 STAG MAKE-UP 6 # of STAG Members Church/Religious Organization City Educational Institution Environmental Advocacy Business Customers Residential Customers

18 STAG: Mission and Vision PURPOSE: Representative of the Pasadena community to provide input on long term energy supply plan STAG MISSION: To assist in the development of the IRP, consistent with mission of PWP > Meet the compliance requirements of SB 350 STAG VISION: To be a valued contributor to the development of the IRP and contribute to the quality of life in Pasadena > Provide input on power supply issues important to you and or your organization > Advise on the inputs and deliverables of the IRP 18

19 POWER INTEGRATED RESOURCES PLAN: PWP 2018 IRP SURVEY 19

20 2018 IRP- Survey As of this morning, 241 people have responded to the survey Public Outreach > Newsletters > Social media (Facebook, twitter, etc.) > Newspaper ads > City bulletin boards > Radio/TV ads > Laemmle Theatre slide 20

21 Key Findings Highest Priority: > High Reliability & Affordable rates Preferred RPS Target: > Between 50%-75% Customer is willing to pay more for (5-10 % rate increase): > Lower GHG emissions > Higher RPS Entire Electric Bill 21

22 POWER INTEGRATED RESOURCES PLAN: PWP 2018 IRP OUTCOME 22

23 Impacts of IRP Provide direction on the IPP Repowering Looking to procure resources that meet the objectives at least cost Rate Impacts > Must compare the rates of the base case, scenarios and optimal portfolio > All rate classes, including Disadvantage Communities are impacted by rate increases Provide guidance on > RPS procurement > EE program development > TE program metrics 23

24 IPP Contract Details Details Existing Contract Renewal (original) Renewal (Alternative Repowering) Fuel Coal Natural Gas Natural Gas Location Delta, Utah Delta, Utah Delta, Utah Project Size 1,800 MW 1,200 MW 840 MW Pasadena Share 108 MW 20 MW 14 MW Term 40 years 50 years 50 years Expires June 15, 2027 June 2077 June 2077 Early transition from coal to natural gas reduces air emissions and allows greater procurement of renewable energy. Plan is for IPP to convert to Natural gas in 2025, for a Pasadena share of 14 MW. 24

25 POWER INTEGRATED RESOURCES PLAN: PWP DELIVERY CONSTRAINTS 25

26 Import Capabilities 26

27 Loads > Normal Import Capabilities 350 Load Distribution (1/ /2017) Years Years Last Year ,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 7,500 8,000 8,500 Load (MW) Hours with Load Greater Than X MW 27

28 POWER INTEGRATED RESOURCES PLAN: PWP 2018 IRP NEXT STEPS 28

29 Next Steps Seek Community Input > Community meetings > STAG meetings until August/September > Survey Selecting Optimal Portfolio > Balance: Reliability, stability, costs and environment Develop IRP Plan 29

30 Power Integrated Resource Plan Consultant Presentation Community Meeting Pasadena Central Library July 18, 2018

31 POWER INTEGRATED RESOURCES PLAN: CONSULTANT BACKGROUND 31

32 Consultant: Background Lon Peters: Northwest Economic Research > Will develop the IRP written report and compliance filing > Former IRP Administrator of Glendale Water and Power > Pasadena resident > 30+ years of utility experience on the West Coast Subcontractors: Siemens and ASWB > Product cost model > Energy efficiency analysis > Transportation electrification analysis > Developed the 2009 and 2012 IRPs for PWP 32

33 Steps for IRP Development Steps Step 1 Step 2 Step 3 Step 4 Step 5 Details Assemble data on energy use in Pasadena, existing resources and potential future resources Build scenarios: various conditions outside PWP that influence choices and costs (e.g., future prices for conventional fuels and emissions, other resources, and storage, California s utility regulations) Establish constraints within which cost to serve customers in Pasadena will be minimized (e.g., reliability) Run various cases to find to least-cost portfolios that meet existing or potential future regulatory requirements and expected market conditions Evaluate results: total costs, rate impacts, emission levels, renewable obligations, reliability 33

34 Modeling and Scenarios AURORA production cost model Modeling > Will show a resource portfolio and costs, at a minimum to comply with SB 350 Preliminary base case complete > The base case is a reflection of information known today for the period covered in the IRP- including policies and regulations in place today (SB 350) and data based on expected market conditions In the process of selecting Scenarios > Scenarios are defined as changes to the assumptions or inputs of the base case 34

35 Identifying and Evaluating Tradeoffs 35

36 POWER INTEGRATED RESOURCES PLAN: CONSULTANT MODELING 36

37 AURORA AURORA: simulates the Western Interconnection and Pasadena. AURORA: dispatch software; used in past Pasadena IRPs. Incorporates market conditions and regulations regarding RPS, reserve requirements, resource adequacy, and distributed generation. Dispatches the electric system to minimize cost given constraints on generation and transmission. Ensures service to PWP s retail load subject to all constraints. AURORAxmp CA Market Conditions & Regulations Hourly Dispatch Optimization Pasadena System (1) model as its own zone to represent available transmission (2) dispatch to balance against the CAISO 37

38 Definitions and Modeling Different states of the world outside of Pasadena, which act as constraints on PWP s possible portfolios Scenarios Portfolios Combinations of demandside and supply-side assets that Pasadena assembles to meet retail load at least cost, subject to constraints Measure of the amount of electricity generated or used over a period of time MWh MW Measure of the amount of electricity that can be generated at one point in time 38

39 Sample Scorecard 39

40 Structured IRP Approach Critical First Step Evaluate Resource Options (Screening analysis) Define Base and boundary World View Scenarios Identify Objectives, Metrics and Risk Perspectives Screen Resource Options Establish Future Market Conditions Develop mix of Portfolios from Screening analysis and judgment Develop Base Case Integration of the financial impact through integrated financial modeling and risk analysis. Best Portfolio(s) selected on the basis of commercial reality, balance of objectives, and perspective of acceptable risk Select Portfolios for Risk Analysis Analyze Risks for Each Portfolio Select Best Portfolios Portfolio Recommendations Consistent with Objectives 40

41 PPA vs. Delivered Cost Contract Price (PPA) Typically Take or Pay Delivered Price Includes > Transmission > Time of Delivery (LMP$) Congestion Losses > Renewable Integration > Resource Adequacy/Reliability 41

42 Solar and Market Prices $80 $70 $60 $50 Avg Solar Output August $ December $ April $ $40 $30 $20 $10 $0 6 am Noon 6 pm Midnight 42

43 POWER INTEGRATED RESOURCES PLAN: CONSULTANT MARKET DRIVERS 43

44 Natural Gas Forecast Reference Case Henry Hub outlook: ST: Aligned with Jan 2018 forwards MT: Upward pressure from exports mitigated by ample supply LT: Gradually rising production costs High Case anticipates several factors: Increased weather-related volatility Second wave of LNG export projects More coal and nuke retirements in mid-2020 s Low Case anticipates several factors: Low LNG, pipeline exports Rapid transition to renewable power Production technology advances New gas resource discoveries 44

45 Natural Gas Forecast: City Gate Source: Pace Global 45

46 CO2 Prices $160 $140 $120 $100 $80 $60 $40 $20 $ $53.14 $26.09 $ Emission Prices (2017$/tonne) 2040 Pace - Consensus Forecast CA Est. Floor Price Carbon High Case Source: Pace Global 46

47 Capital Costs Combined Cycle Advanced Frame Simple Cycle CT Capital Cost, Simple Cycle CT, 2017$/kW Simple Cycle CT_High Simple Cycle CT_Low Simple Cycle CT_Base Source: Pace Global Source: Pace Global The high case and low case values are derived through a +/-1 standard deviation from the mean of the stochastic distributions. Source: Pace Global 47

48 Capital Costs Wind Utility Scale Solar Source: Pace Global Source: Pace Global The high case and low case values are derived through a +/-1 standard deviation from the mean of the stochastic distributions. Source: Pace Global 48

49 Capital Costs- Li-ion Batteries Li-Ion Batteries Source: Pace Global Note: Base capital cost is the consensus of several sources including Lazard, CEC, etc. Source: Pace Global 49

50 POWER INTEGRATED RESOURCES PLAN: CONSULTANT PRELIMINARY FINDINGS 50

51 Preliminary Base Case Findings Base Case Findings Thermal Resources operated at minimum take levels, to limit emissions Local generation operated only for local reliability and system reliability All new resources are wind or solar Met mandated RPS and GHG targets Intermountain Power Plant not selected as supply after 2027 Future Considerations Diversification of resource mix How to meet reliability requirements 51

52 POWER INTEGRATED RESOURCES PLAN: CONSULTANT THE END 52