Navajo Generation Station Phase 2 Study

Transcription

1 Navajo Generation Station Phase 2 Study Stakeholder outreach Kevin Black, USBR Scott Hasse, NREL David Hurlbut, NREL NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC. Prior work leading up to Phase 2 study NREL Phase 1 (Jan. 2012) o Driven by EPA notice of intent to issue BART rule for NGS o Examined NGS history, operation characteristics, role in CAP rates, role in water settlement o Provided initial analytical benchmarks based on cost of NO x mitigation NREL Phase 1 supplement (April 2012) o Characterization of renewable resource potential that could contribute to an NGS replacement portfolio 2 1

2 Joint Statement by DOI, DOE, EPA (2013) Long term goals o Clean, affordable and reliable power o Affordable and sustainable water supplies o Sustainable economic development o Minimize negative impacts on those who currently obtain significant benefits from NGS Complete NREL Phase 2 report on NGS clean energy options to inform NGS Road Map 3 Technical Working Group Agreement Proposed better than BART alternative for reducing NO x emissions Additional federal commitments o Clean energy development o Carbon reduction Proposed framework for NREL Phase 2 Study o Identified tribal and non tribal constituencies o Conduct outreach with CAWCD and other stakeholders 4 2

3 NGS KMC EIS & the NREL 2 Study Phase 2 study and EIS are different but not isolated from each other Some Phase 2 study tasks will provide background o Results will be independent of what may happen with o NGS Will not weigh for or against any EIS alternative Later tasks analyzing specific NGS transition glide paths will be informed by the NGS KMC EIS public scoping comments Technical inputs to EIS NREL Phase II 5 What the Phase 2 study is (and is not) Energy sector knowledge base to aid DOI, DOE and EPA in their formulation of the NGS Road Map (as called for in Joint Federal Agency Statement) o Phase 2 study will inform the Road Map, but is not the Road Map o Other resources besides Phase 2 study will inform the Road Map with regard to non energy issues Focus is exclusively on analysis of options for replacement energy of federal share of NGS o Work in close coordination with CAWCD o Portfolio approach 6 3

4 Why Focus on the federal share of NGS? Utility partners have their own on going planning processes based on their own customer service needs o Phase 2 study will perform similar planning role for federal share in coordination with CAWCD s ongoing efforts Will coordinate with utilities for consistency of assumptions o Load growth o Generator, transmission characteristics o Costs inputs Utilities Shares of NGS US 7 Modeling assumptions: FIP/TWG Agreement 2019 Operations reduced to 2 units (or equivalent) 2029 NO x control on 2 units 2044 Final year of NGS operation Shut down one unit (actual or virtual) no later than the end of 2019 SCR on remaining units no later than the end of 2029 Operates until

5 Elements of NGS Phase 2 Study Utility Cost planning trends Policy landscape Federal NGS Clean Energy Options Development Fund impacts CAP water user impacts Navajo Nation impacts Hopi Tribe impacts *non Indian agriculture Baseline conditions 9 Task 1: Baseline conditions Today s conditions don t work as a standard for comparison, because the world is changing independent of what happens with NGS Model current trends with respect to: CAP water tribe impacts o New power plant additions (Resource Federal Planning Navajo Model) Nation impacts o Fuel/variable cost of generating NGS power (PLEXOS) o Economic impacts (Computable Clean General Equilibrium) Hopi Tribe impacts Two bookends for the baseline Energy analysis o Full shutdown of NGS by 2020 CAP NIA* impacts Options o Full operation of NGS to2044 (consistent with FIP/TWG Agreement) Development Fund impacts Baseline conditions 10 5

6 RPM: Optimization Model General o Co optimizes new transmission, new generation, and dispatch Mixed integer linear program o Models in 5 yr increments o Represents all of Western Interconnection and local region Major equations o Hourly security constrained dispatch (contingency, regulation, flexibility reserves); commitment of large units 3 chronological dispatch periods (4 days 1 week each) + peak day o Renewable energy resource zone sizes and performance profiles, capacity value estimates, for wind, PV, and CSP o Basic transmission constraints Policies o State RPS policies o Exogenous retirements o No California AB32 or proposed EPA regulations 11 RPM AZ focuses on 1,342 nodes * within 5 BAs (APS, SRP, TEP, WALC, NEVP), and 31 BA zones for the rest of the Western Interconnection * 485 load nodes and 243 generation nodes; 24 nodes have load and generation. 12 6

7 Central assumptions Central technology costs o Conventional generation based on AEO 2013 Reference o Wind and PV from the DOE Wind Vision study o Transmission from the DOE Wind Vision study o No new coal, nuclear, storage, geothermal, CSP other modeling analysis has found these to be not as cost competitive compared with wind, PV, and natural gas Fuel costs from the AEO 2013 Reference scenario Retirements from WECC/TEPPC 2022 database, plus San Onofre and coal retirements from MJBradley Planned generator additions included from Ventyx Current policies only o current RPS (no AB32 representation in current version) o no carbon price & no proposed EPA regulations o expired wind PTC and current solar ITC (30% until 2016, 10% after) 13 Assumptions: fuel price projections Notes: Assumptions from the EIA AEO 2013 Reference scenario and High/Low Oil and Gas Resource scenarios). National average values used. 14 7

8 Scenario framework 1. Core scenarios o Reference (no NGS units retired) o Central (1 NGS unit retired by 2020) o Accelerated retirement (all 3 NGS units retired by 2020) o Gradual retirement (1 NGS unit retired by 2020, other two by 2030) 2. Natural gas sensitivity o o Reference with higher & lower fuel prices Central with higher & lower fuel prices 3. Carbon price sensitivity (central scenario) 15 Key outputs Compare core scenarios o Capacity deployment type, amount, location, and timing o Generation mix and resulting emission rates Focus will be on CO 2 emissions, but may be able to review SO 2 and NO x as well (challenges exist on projecting emission controls technologies) o Relative net present value of system expenditures (capital, O&M, fuel, transmission) (interpolating costs between years) 3% discount rate Similar comparisons for natural gas price, carbon price sensitivities 16 8

9 Schedule for NGS 2 RPM analysis To date: o Completed database o Developed RPM AZ model and equations o Modeling comparison with historical data (ongoing) o Developing data assumptions to be used November: draft report for technical review December/January: published report Results will provide inputs to other Task 1 modeling to be conducted in early 2015 o Production cost modeling o Computable general equilibrium modeling 17 Task 2: Sectoral trends Policy landscape Where are future technology costs heading? What are Arizona CAP water utilities tribe impacts Federal already planning Navajo for? Nation impacts NGS o Clean New plants Hopi Tribe impacts Energy o Purchased power CAP NIA* impacts Options o Plant retirements What public Development policies Fund are impacts in play, independent of regulatory decisions about Baseline conditions NGS? o Possible Sec. 111(d) regulations Utility Cost planning trends 18 9

10 Task 3: Analysis of options Emphasis on NGS glide path o o Gradual transition timed to minimize economic disruption Will take into account: FIP milestones Future cost trajectories Other sectoral factors identified in Task 2 Federal NGS Clean Energy Options Options will be narrowed after EIS CAP comment water tribe impacts period Navajo Goal Nation is to impacts identify opportunities for Hopi Tribe impacts consideration by CAP Reclamation, NIA* impacts CAWCD Development Fund impacts Baseline conditions 19 Task 4: Impacts What will impacts be on the Lower Colorado River Basin Development Fund? Federal o Current statute requires NGS revenues from selling power Clean out of US share of NGS to Energy go into the Development Fund Options o Analysis of how options examined in Task 3 could be treated with respect to the Development Fund Development Fund impacts CAP water tribe impacts Navajo Nation impacts Hopi Tribe impacts CAP NIA* impacts 20 10

11 Task 4: Impacts For each option identified in Task 3, break down the impacts on NGS constituencies Potential actions to alleviate Federal NGS Clean Energy Options o Revenue from clean energy projects o Efficiency improvements Baseline conditions negative impacts will focus on those relating to energy Development Fund impacts CAP water user impacts Navajo Nation impacts Hopi Tribe impacts 21 NGS and the Development Fund CAWCD Revenue from NGS surplus power sales LCRB Devel. Fund Repayment of debt for CAP construction Arizona Water Settlements Act projects 22 11

12 NREL Phase II Study Tasks Reclamation/DOE Funding Agreements o Completed 2014 Tribal Stakeholder Outreach o Initiated 2014 Baseline modeling o Initiated 2014 o Scheduled for completion 2015 Final Scope, Schedule and Budget for NREL II o October NREL PHASE II STUDY NEXT STEPS Complete initial stakeholder outreach Oct Formulate scope elements from outreach and EIS Public Scoping comments Oct Develop technical subgroups with various stakeholders Nov Finalize scope, schedule and budget for all subtasks defined with stakeholder input Jan Complete all baseline modeling and report findings

13 Questions? 13