Integrated Resource Planning at Tacoma Power. Ahlmahz Negash EE 500E Energy & Environment Seminar University of Washington

Transcription

1 Integrated Resource Planning at Tacoma Power Ahlmahz Negash EE 500E Energy & Environment Seminar University of Washington

2 About Tacoma Public Utilities Public, cost-of-service organization; we don t pay investors Part of the community since 1893 Led by a 5-member Public Utility Board appointed by the mayor and confirmed by the Tacoma City Council Services include: Power, including Click! Water Rail

3 Tacoma Power s Resources Hydroelectric Power 97% Carbon-Free Surplus hydro power Currently sold wholesale Could be used (retail) for electrification of transportation. Conservation 10% Bonnaville Contracts 51% Mossyrock Dam Tacoma Owned 36% Resources Other Contracts 3% Wholesale Sales 40% Cushman Powerhouse Tacoma's Load 60% Sales to Customers

4 About the IRP What is an Integrated Resource Plan? A planning tool that Determines whether, when, and which new resources are needed to meet forecasted demand for electricity over the next 20 years. Plans how the utility will comply with conservation and renewable energy requirements of I-937. Required by law (RCW ) to consider both supply-side resources (like utility-scale generation) and demand-side resources (like conservation) on an equal basis. Open to the public

5 2015 IRP public Process and Schedule Stakeholder Process Public Meeting #1 April 19 th 1. Tacoma Public Schools 2. Tacoma Community College 3. Bates College 4. WestRock 5. Pierce Conservation District 6. Bonneville Power Administration 7. WA State Department of Commerce Public Meeting #2 Sept 27th 1. Bates College 2. University of Puget Sound 3. Davita 4. Praxair 5. WestRock 6. Multicare 7. City of Tacoma Office of Sustainability 8. Northwest Energy Coalition 9. Northwest Power and Conservation Council 10. WA State Department of Commerce Q1 Q2 Q3 Q4 Invitation to Participate Present to Senior Management Oct 10 Present to PUB Oct 25 Request PUB Adopt IRP Nov 15 5

6 Planning Process Survey Landscape Identify Need Define Resources Analyze Uncertainty Develop Action Plan Resources Loads Policy Technology Load resource balance Resource adequacy Generation Conservation T & D Sensitivity Scenario Stochastic Portfolio strategy Monitor conditions Repeat every 2-4 years!

7 amw 2015 Annual Load-Resource Balance (2001WY) Survey Landscape Identify Need Define Resources Analyze Uncertainty Develop Action Plan BPA - Block BPA - Slice Other Resources 7 TPU Resources Load without Cons Load with Cons

8 2-Year Action Plan Survey Landscape Identify Need Define Resources Analyze Uncertainty Develop Action Plan 1. Acquire 9.4aMW conservation 2. Continue evaluating BPA products 3. Learn from small-scale pilots 4. Monitor emerging technologies impacting retail load 5. Explore methods to incorporate climate change impacts 8

9 9 What has changed since 2015?

10 amw Changes since 2015 Lower and declining load forecast Declining usage per customer Energy efficiency Codes and standards Adjusted large load assumptions Firm Energy Load Forecast w/ Conservation Forecast 2017 Forecast 10

11 $/MMBTU Changes since 2015 Lower and declining load forecast Lower natural gas price forecast $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 Natural Gas Price Forecasts Fall 2016 Fall 2015 Fall All price forecasts in 2016 dollars

12 $/MWh Changes since 2015 Lower and declining load forecast Lower natural gas price forecast Lower electricity wholesale market price forecast $60 $45 $30 Mid-C Wholesale Price Forecasts $15 $ Forecast 2016 Forecast 2017 Forecast 12 All price forecasts in 2016 dollars

13 What What do do these these changes mean? mean? Our forecasted surplus energy is increasing. The market value of surplus sales is declining. 13

14 IRP Questions Resource Adequacy Can we meet annual energy needs under critical water conditions? Can we meet monthly/seasonal energy needs 95% of the time? Do we have capacity to meet a 72 hour peak? I-937 Compliance How should we meet our renewable portfolio standard obligation? 14

15 Average Megawatts Annual Adequacy Metric Annual Load Resource Balance (Critical Water) Simulated energy supply under critical water conditions exceeds forecasted customer loads over a year BPA - Block BPA - Slice Ensures we have enough energy to meet retail demand. Other Resources TPU Resources Load w/conservation 15

16 average megawatts Monthly Adequacy Metric -100 Monthly Load Resource Balance: 5th Percentile Simulated energy supply exceeds forecasted customer loads in every month, 19 times out of 20. Ensures we have the capacity to meet customer need as it varies by season and month Worst case scenario 16

17 Megawatts Peak Adequacy Metric Hour Peak Winter Capacity Analysis (2020) Simulations of Retail Load and Hydro Load Reserves Capacity Simulated energy supply exceeds the highest 72-hour average peak customer load in 19 out of 20 water year simulations. Ensures we have the capacity to meet the most pressing peak demand. Represents stressful conditions 17

18 MWh Renewable Portfolio Standard (RPS) Obligation 800, , , ,000 0 I-937 Renewable Requirement and Compliance Strategy I-937 Renewable Energy Compliance Options: 1. Renewable generation resource 2. Renewable energy credits (RECs) Hydro Improvement Acquired RECs Banked RECs Used BPA Wind RECs Excess RECs Banked Projected Renewable Need 18

19 Tacoma is not projected to need a new generation resource. Conservation continues to be Tacoma s preferred resource. 19

20 2017 Action Plan: 1. Acquire target of 6.4 amw of conservation as directed by the Conservation Potential Assessment 2. Investigate the value of flexible capacity 3. Explore distributed energy resource (DER) planning 4. Improve resource planning analytical methodologies 20

21 Looking Ahead to the 2019 IRP NAVIGATING CHANGE AND UNCERTAINTY

22 Sources of Change and Uncertainty Loads Resources Fuel Costs Market Prices Energy Policies

23 Declining load growth is the new normal Yr Change in Regional BA Loads 4% 3% 2% 1% 0% -1% -2% -3% -4% -5% 20% 15% 10% 5% 0% US Load Growth (Annual & Decadal Average) -5% amw Change % Change Annual Growth Decadal Average Source: Ansergy, 2017 Source: EIA, Loads Resources Fuel Costs Market Prices Energy Policies

24 (ft^3/sec) Thousands Hydroelectric output depends on water conditions Average Monthly Inflows Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Loads Resources Fuel Costs Market Prices Energy Policies

25 Contracts represent 55% of our resources and expire by CBH (1.5 amw) CBH (23 amw) BPA (400 amw) CBH (0.55 amw) CBH (5.5 amw) We assume CBH Contracts expire and BPA is renewed. This keeps us surplus (on ave.) through the planning horizon. 25 Loads Resources Fuel Costs Market Prices Energy Policies

26 Dec-16 Sep-17 Jun-18 Mar-19 Dec-19 Sep-20 Jun-21 Mar-22 Dec-22 Sep-23 Jun-24 Mar-25 Dec-25 Sep-26 Jun-27 Mar-28 Dec-28 Sep-29 Jun-30 Mar-31 Dec-31 Sep-32 Jun-33 Mar-34 Dec-34 $/mmbtu - real $/MMBTU Natural gas impacts prices and adds uncertainty We assume a lower gas price forecast $12 Henry Hub NG Forecast (2016$) But economics or policy may change that $12 Henry Hub Spot Prices (2016$) $10 $10 Reference case $8 $6 $4 $2 $0 $8 $6 $4 $2 $0 High economic growth Low economic growth High oil price Low oil price High oil and gas resource and technology Low oil and gas resource and technology Spring 2016 Fall 2016 Spring Loads Resources Fuel Costs Market Prices Energy Policies

27 Wholesale power prices impact customers $60 Average Market Prices & BPA Contract Rates $45 $30 BPA Priority Firm Mid-C Actual Mid-C Projected $15 $ Loads Resources Fuel Costs Market Prices Energy Policies

28 Not all carbon policies are equal Washington GHG Emissions (MMT CO2e) 100 Total Other Electricity Residential/Commercial/Industrial Use Transportation Electrification Carbon Tax Innovation Electrification Carbon Tax Renewable Pipeline Increased RPS Carbon Tax Source: WA Department of Ecology Actual Target Loads Resources Fuel Costs Market Prices Energy Policies

29 Future of Resource Planning DOE Recommendations: Ensure consistent methods to evaluate a wide range of DERs (in addition to conservation) and utility scale generation Consider new investment drivers in addition to traditional resource adequacy, such as risk management, value-added services or cost reduction. Develop integrated models to systematically consider rate design, customer behavior, and distribution networks into the resource planning process. 29

30 30 Thank You