If Not Gas Infrastructure, Then What? And How?

Transcription

1 If Not Gas Infrastructure, Then What? And How? James Avery, Pierce Atwood LLP (Moderator) Seth Kaplan, EDP Renewables Charles Scott, Ørsted North America Inc. Andrew Kaplan, Pierce Atwood LLP Michael Stoddard, Efficiency Maine Trust Richard Jordan, TRC October 4, 2018 Boston, MA

2 RFPs for Large-Scale Renewables Since 2013 Past (since 2013) Current (bids are in) Upcoming Future MA CT RI NY Sec. 83A Sec. 83B (CERFP) Sec. 83C Sec. 83D Sec. 83C (remaining 800 MW) Senate bill proposal (expands 83C & 83D) Sec Sec. 7 (CERFP) (DG RFP) Sec Sec. 1 ( Millstone RFP) Additional authority under several statutes LT Contracting Std. CERFP (initially under ACES, shifted to LT Contracting Standard) Sec. 83C tagalong 400 MW RFP Done? RPS Main Tier RES RFP 17 1 NYPA 2017 LSR RFP RES RFP 18 1 Annual RES RFPs OSW RFP NYPA/LIPA RFPs More OSW RFPs Chart from Bob Grace at Sustainable Energy Advantage from earlier this year Adds up to several GWs of capacity. Next two slides illustrate demand & supply Copyright Sustainable Energy Advantage, LLC. 1

3 New England Land Based Wind Potential Massachusetts Section 83D RFP Bids Received 2017 Quebec 1902 Maine 2961 New Brunswick 768 Nova Scotia 425 Total Wind Bid Exceeds 6,000 Megawatts New York Mass Megawatts Nameplate Capacity Major Transmission Proposals to Serve Wind 2

4 From ISO NE PAC

5 The underlying drivers: Public demand generally... Support for renewable development driven by multiple forces: Economic Development, Climate... 4

6 ... and specifically in Massachusetts (Sept poll) and Massachusetts voters share the national perspective on renewable energy... oddly, there doesn t seem to be the same kind of national or state polling by objective news or academic pollsters about natural gas... 5

7 Ørsted Offshore Wind: North America Charles R. Scott, Senior Legal Counsel October 4, 2018

8 Hecate Strait Project Bay State Wind Ocean Wind CVOW Bay State Wind Lease Area 50/50 JV with Eversource 2,300 MW potential capacity 187,500 acres lease area 15 miles from Martha s Vineyard Ocean Wind Lease Area 3,500 MW potential capacity 160,500 acres lease area ~10 miles from Atlantic City Coastal VA Offshore Wind Ørsted acting as EPC contractor 12 MW demo windfarm 2,100 acre site 22 miles from Virginia Beach Coastal Virginia Offshore Wind 1

9 Market Potential for Offshore Wind in the U.S. States committed to procure + 10 GW by BOEM has identified 1.4m acres of OSW lease areas CALIFORNIA RPS: 33% by 2020; 40% by 2024; 45% by 2027; 60% by 2030; 100% by 2045 GHG: Reduce GHG emissions to 1990 levels by 2020; 80% reduction below 1990 levels by 2050 HAWAII West Coast RPS: 30% by 2020; 40% by 2030; 70% by 2040; 100% by 2045 MA RI CT NY NJ MD VA NC DE East Coast Active Ørsted Market State with OSW activities RPS: 40% by 2030 VIRGINIA (VA) RPS: Voluntary, 15% by 2025 Dominion has rights to demonstration project and commercial lease area with expected capacity of 2.0 GW CONNECTICUT (CT) Renewable and zero-carbon RFPs, being issued in response to 2018 Comprehensive Energy Strategy, allows for OSW participation RPS: 25% by MARYLAND (MD) Awarded 370 MW PPA s for two OSW projects NORTH CAROLINA (NC) RPS: 12.5% by 2021 for Investor Owner Utilities; 10% for co-operatives and municipal utilities MASSACHUSETTS (MA) RPS: 15% by 2020 and additional 2% each year after until DPU mandated to procure 1,600MW of OSW by 2027 and authorizes procuring further 1,600MW by 2035 RHODE ISLAND (RI) RES: 14.5% by 2019, increasing 1.5% ea. year until 38.5% by Renewable goal of 1GW by RFP to procure 400 MW of clean energy by Q RPS: 50% by 2030 NEW JERSEY (NJ) RPS: 50% by OSW goal of 3,500MW by 2030 NJBPU solicitation schedule call for solicitations of 1,100MW in 2018 and 1,200MW in 2020 and 2022 NEW YORK (NY) January 2017 Gov. Cuomo announced goal of 2.4 GW of new OSW development by 2030 DELAWARE (DE) RPS: 25% by % compliance multiplier for OSW 2

10 State-by-State Offshore Wind Analysis: Massachusetts 3.2 GW Offshore Wind Market Statutory Mandate: 1.6 GW by 2027, possibly 3.2 GW by 2035 Recent Procurement: 800 MW in bundled PPAs awarded to Vineyard Wind in May 2018 currently subject to regulatory approval (anticipated in early 2019) Upcoming Procurement: Next RFP, for at least 400 MW, required to begin by June 2019 LCOE must be lower than previous RFP Source: U.S. Bureau of Ocean Energy Management 3

11 State-by-State Offshore Wind Analysis: Rhode Island 430+ MW Offshore Wind Market Target: Gov. Raimondo set 2017 goal of 1 GW of additional clean energy by 2020 Existing Activities: 30-MW Block Island Wind Farm 400-MW bundled PPA awarded to Deepwater Wind in conjunction with 2018 Massachusetts RFP Upcoming Procurement: 400-MW renewable generation RFP issued in Aug bids due Oct. 2018, awards May 2019 Source: U.S. Bureau of Ocean Energy Management 4

12 State-by-State Offshore Wind Analysis: Connecticut 200+ MW Offshore Wind Market Recent Procurement: 200 MW of bundled PPAs awarded to Deepwater Wind in May 2018 conjunction with Massachusetts RFP Subject to regulatory approval Current Procurement: 12-TWh Zero Carbon RFP 100+ bids received, including offshore wind, solar, hydro, and nuclear Structured to provide subsidy for Millstone nuclear plant, but with opportunity for Connecticut to procure portfolio of resources Source: U.S. Bureau of Ocean Energy Management 5

13 State-by-State Offshore Wind Analysis: New York 2.4 GW Offshore Wind Market Target: Gov. Cuomo set goal of 2.4 GW of offshore wind by 2030 Existing Activities: 90-MW Deepwater Wind South Fork PPA with LIPA (2017) Upcoming Procurement: NYSERDA has issued draft RFP for 800+ MW of offshore wind Schedule uncertain, but winners expected to be announced April 2019 Award takes form of OREC contract (Index or Fixed) Source: New York State Energy Resource and Development Authority 6

14 State-by-State Offshore Wind Analysis: New Jersey 3.5 GW Offshore Wind Market Statutory Mandate: 3.5 GW of offshore wind by 2030 (with procurements scheduled for 2018, 2020, and 2022) Existing Activities: 24-MW Fishermen s Energy project, originally scheduled for 2013, again seeking regulatory approval Current Procurement: N.J. BPU has opened OREC application window for up to 1100 MW, with Dec. 28, 2018 deadline 180-day evaluation period, with focus on net economic benefits Source: U.S. Bureau of Ocean Energy Management 7

15 Upcoming BOEM Lease Auctions Massachusetts Proposed Sale Notice published April 2018 New York Call for Nominations published April 2018 Source: U.S. Bureau of Ocean Energy Management 8

16 Expected Market Growth North America is an attractive and strategically important market Expected Installed Capacity 1 GW +10 to 15 GW +7 to 9 GW to 5 GW , Expected Installed Capacity according the Ørsted North America projections. In comparison, BNEF s U.S. Offshore Wind publication (issued 22 Jan 2018) reports a U.S. Offshore Wind Forecast projecting 0.08 GW by 2020, 2.7 GW by 2025, and 6.2 GW by The same publication reports a Best-case Scenario Forecast projecting 0.08 GW by 2020, 7.2 GW by 2025 and 19.6 GW by

17 Ørsted s footprint in North America Ørsted North American HQ Boston, MA New Bedford, MA Lincoln Clean Energy Chicago, IL New York, NY Atlantic City, NJ Ørsted Corporate Ventures San Francisco, CA Richmond, VA Canada Ørsted Energy Storage & Solar Solutions Austin, TX Vancouver, BC 10

18 Source: 11

19 Q&A

20 If Not Gas Infrastructure, Then What? Energy Storage Energy Infrastructure Symposium October 4, 2018

21 Energy Storage: 1883 Until we learn how to store energy, we are just a bunch of animals. Thomas Edison 2

22 Benefits of Energy Storage Storage is imperative throughout our Power System Customers: Increased reliability / reduced outages Utilities Deferred / unneeded investments in distribution and transmission infrastructure Grid Operators Fast-response capabilities Improved quality to ancillary services The World Environmentally-friendly no harmful emissions 3

23 Energy Storage: 2007-present FERC Order 890 (2007): Technologies capable of providing non-generation services should be allowed on the grid FERC Order 755 (2011): Technologies providing services on the grid should be paid for the value they provide to grid operators FERC Order 841 (2018): All markets should be opened to energy storage energy, capacity and ancillary services 4

24 FERC Order No. 841 is a Big Deal 1. Creates a clear legal framework for storage resources to operate in all electric markets and requires that ISOs implement a conforming market design 2. Expands the universe of solutions that can compete to meet electric system needs 3. Represents necessary steps on the path to more flexible electricity system 5

25 Implementing Order No. 841: ISO-NE ISO-NE s proposal would: Lower the minimum size requirement for energy storage to 100kW; Allow any storage technology to participate in the regional market Proposed effective in Q

26 Implementing Order No. 841: NYISO Features of NYISO Proposed compliance plan: Accommodates all storage types (flywheel, battery) 100 kw minimum offer size for Energy, Capacity, and Ancillary Services Storage will be eligible to provide services while withdrawing Energy consumed by storage units will be treated as negative generation, not load. NYISO will submit the compliance filing on December 3,

27 Andrew O. Kaplan Partner

28 Consideration of Energy Conservation and Strategic Electrification Michael D. Stoddard Efficiency Maine Trust Energy Infrastructure Symposium Boston, MA October 4,

29 Annual Funding for Energy Efficiency in New England States ( ) 2

30 New England Capacity Savings from Efficiency Programs Past and Future 3

31 U.S. Utility Program Spending on Conservation Programs ($ Billions) Source: ACEEE, Natural Gas Energy Efficiency, 2017, at 7, citing Berg et al,

32 U.S. Utility Program Gas Savings from Conservation Programs (% of Annual Sales) U.S. Utility Program Gas Savings from Conservation Programs (% of Annual Sales) Source: ACEEE, Natural Gas Energy Efficiency, 2017, at 8, citing Berg et al (2016), Foster (2012), Downes (2013), York (2012), and ACEEE Scorecard. 5

33 NEG ECP GHG Reduction Targets for 2030 and

34 Electrification as a Means for Meeting GHG Reduction Targets The Brattle Group 7

35 Ramp up Scenarios Heat Pumps Share of New Heating System Sales EVs Share of New Vehicle Sales 8

36 Regional Electric Sales Plausibly Optimistic Electrification Scenario (Approximately 1/3 Increase in Load Growth) 9

37 Impact on Peak Demand 10

38 Cold Climate, High Efficiency Ductless Heat Pumps Residential (#Units in Maine) Total Installed Measures 14,000 12,000 10,000 8,000 6,000 4,000 2,000 Efficiency Maine Trust has incentivized installation of 35,000 ductless heat pumps in the past 5 years Minimum efficiency standard: o o HSPF 12 for single head HSPF 10 for multi head FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Source: Efficiency Maine Trust, Triennial Plan IV (2018) 11

39 Heat Pump Water Heaters Residential (#Units in Maine) ENERGY STAR s 2017 Unit Shipment Data Summary Report shows 72,000 heat pump water heaters shipped nationally in 2017 Efficiency Maine rebated more than 6,500 units in 2017 o 9% of HPWH shipments in the US. Source: Efficiency Maine Trust, Executive Director s Report (10/2018) 12

40 CONTACT Check us out online at: Write or visit us at: 168 Capitol Street, Suite 1 Augusta, Maine

41 Solar in New England Pierce Atwood 2 nd Annual Energy Infrastructure Symposium October 4, 2018 trcsolutions.com

42 Solar in New England New England has large energy challenges Big challenges may need big solutions Solar will be one of the solutions 2

43 Solar in New England Solar Rankings in US (SEIA 2018): MA 7th CT 19th VT 27th NH 36th RI 39th ME 43rd (>3K MW) 3

44 Solar in New England 4

45 Solar in New England There is momentum and appetite for solar: Hundreds of smaller projects (e.g. Landfill/Brownfield; rooftop, canopy, community, corporate ) ISO NE > over 60 >10MW solar projects (2017 & 2018 queue requests) ~1800MW Tri State RFP > 300MW to solar CT DEEP RFP > 71 Solar Projects (33 w/batteries) 17 developers RI RFP >?? 5

46 Solar in New England Why is it spreading? Competitive WE HAVE ENOUGH SUN (seriously!)! Technology and contractor/supplier innovation > lowering installed costs. Meet Goals, Makes/Saves Money Cool Familiar Free fuel Environmental benefits Jobs (~18K in New England) 6

47 Solar in New England Challenges (not applicable solely to solar!) 1. Predictability Busy ISO NE Queue + Interconnection Challenges/Costs + Policy Unpredictability 2. $ = Investment Risk and Uncertainty (buzzkill) relatively high development costs (land, IC, design/permitting, labor) but still low installed $/MHW 7

48 Solar in New England Challenges Continued 3. Siting Depending on whom you ask, all of New England is either wet, rocky, steep, or wicked special. Zoning (or lack of); opposition 4. Philosophy Dogma: Solar don t work here DG vs. Utility Scale EE vs. New Generation Northern NE vs. Southern NE (common challenges) 8

49 Solar in New England Overcoming Challenges: Start early Site well Engage in strong stakeholder outreach (including ut s) Be flexible Anticipate surprises 9

50 Solar in New England How do we make New England even greater? New England s energy challenges require a multi faceted approach Energy > safer, cleaner, smarter, cheaper A chicken in every pot, and a panel on every roof! Natural gas, hydro and nuclear = parts Public appetite, public policy, costs, and inertia > increased investment and adoption of renewable & zero carbon innovations and technologies Solar, wind, storage, and energy efficiency (+others), will be BIG parts of the energy solution 10

51 Second Annual Energy Infrastructure Symposium October 4, 2018 Boston, MA