University of Nevada, Las Vegas Digital Scholarship@UNLV UNLV Renewable Energy Symposium 2007 UNLV Energy Symposium Aug 15th, 9:00 AM - Jul 15th, 10:00 AM Renewable energy - the future is now Thomas Fair Nevada Power Repository Citation Thomas Fair, "Renewable energy - the future is now" (August 15, 2007). UNLV Renewable Energy Symposium. Paper 7. http://digitalscholarship.unlv.edu/res/2007/aug15/7 This Event is brought to you for free and open access by Digital Scholarship@UNLV. It has been accepted for inclusion in UNLV Renewable Energy Symposium by an authorized administrator of Digital Scholarship@UNLV. For more information, please contact digitalscholarship@unlv.edu.
Renewable Energy - The Future is Now Thomas Fair Executive for Renewable Energy August 15, 2007
Introduction Political, regulatory and public support for renewable energy is very strong in Nevada Nevada has an aggressive Portfolio Standard Geothermal and solar energy are a particularly significant resources in Nevada We estimate that over $2 billion will need to be spent on renewables by 2015 to meet the Nevada Standard Nevada is one of only three states that allow DSM to contribute to their Portfolio Standard. Sierra Pacific plans to participate in renewables projects both as an investor, and as a power off-taker Sierra Pacific is encouraging renewable energy companies to develop projects in Nevada In the past 12 months we have signed 12 renewable energy PPAs (including 230 MW geothermal) and have several more pending We are planning to co-develop wind and geothermal projects 1
Nevada s Portfolio Standard Nevada requires 20% by 2015 - one of the most aggressive Standards in the U.S. Based on energy (kwh) sales Solar set-aside DSM can make up ¼ of 20% Stair-step standard multiplied by Sierra s rapid kwh sales growth means a large amount of new renewables will be added to our mix 2
Required Renewable Energy kpc 9,000,000 Nevada Power Company and Sierra Pacific Power Company Combined Portfolio Standard Requirements 2005-2027 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 Compound Annual Growth Rate: 2005-2015: 15.4% Demand Side Management Solar Energy 3,000,000 2,000,000 1,000,000-6% 9% 12% 15% 18% 20% PS % of Retail Sales Non-Solar Renewable Energy Compound Annual Growth Rate: 2005-2020 = 10.7% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 3
1. Invest in renewable facilities Strategy 2. Accelerate procurement 4 3. Ramp-up DSM
Current Renewable Supplies Sierra Pacific has a long history of renewable QF purchases, including an extensive geothermal energy portfolio Renewable resources abundant in the North New geothermal plants being developed in North New solar plants in the South A 500 kv transmission tie is planned for 2011 5
Planned Additions - MWh 5,000,000 4,500,000 4,000,000 Sierra Pacific Resources Renewable Energy Supply Geothermal Solar Wind 3,500,000 Other Renewables Annual MWh 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015. 6
Planned Additions - MW MW 1200 1000 800 600 New Other Renew New Wind New Solar New Geothermal In-Service 400 200 0 2005 2006 2007 2008 2009 2010 2011 2012 7
RPS Outlook Renewable (non-solar) Credits M Whs / Portfolio Energy Credits 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 Portfolio Standard Requirement Renewable Energy and DSM Savings Portfolio Energy Credits 8
RPS Outlook - Solar MWhs / Portfolio Energy Credtis 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 Solar Credits Additional solar development expected before 2012 will prevent credit downturn 2007 2008 2009 2010 2011 2012 2013 2014 2015 Portfolio Standard Requirement Solar Energy Solar Energy Credits (inc Carryforward) 9
Geothermal Development Nevada s primary renewable resource Nevada ranks 2 nd only to California in geothermal potential 15 operating plants totaling close to 250 MW 20+ year history of resource exploration, characterization & development We are adding 100 s of MW to our supply Nevada is No. 1 in watts/capita of geothermal energy 10
Geothermal Energy (cont d) Requires expensive well drilling (30-40% of project cost) High construction cost, but produces energy 24x7 Ormat s Burdette Plant: 26 MW 170,000 MWh/year Typical project size is small (20 to 30 MW); good fit to grid Typical 30 MW project costs ~$100 MM for drilling & construction Additional wells may be required over life of project to maintain production 11
Utility s Load vs. Geothermal Output Load MW NPC Load Profile 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour NPC - Annual Average NPC - July Average Output Typical Geothermal Output Curve % of Annual Total NPC Annual Load Curve 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Month NPC % Geothermal Annual Output Curve MW 25 20 15 10 5 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour Average Geothermal Output - December Average Geothermal Output - July Hottest July Day (7/9/07) % of Annual Total 12% 10% 8% 6% 4% 2% 0% Net Capacity Factor - 75% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Month Geothermal Output 12
Solar Development Southern Nevada has an excellent resource 64 MW Nevada Solar One solar thermal project recently completed Solar technologies are not yet ready to compete with other renewables on a pure economic basis, but are making strides 64 MW Nevada Solar One and 12 MW NAFB PV project (under construction) make Nevada No.1 in solar energy per capita 13
Nevada s Solar Energy Ranking Nevada No. 1 at end of 2007 Received Solar Champions Award from Solar Energy Ind. Assn. So lar G e n era tio n as p ercen t o f reta il sales ( 2007) 0.45% 0.40% 0.35% 0.30% 0.25% 0.20% 0.15% 0.10% 0.05% 0.00% NV CA CO AZ NJ NY PA NM So lar W atts p er Person ( 2007) 40 35 30 25 20 15 10 5 0 NV CA CO AZ NJ NY PA NM Sources: EIA, CEC, DSIRE, Nevada Power, B&V projections. CA: assumes 100% growth for PV from 10/06 to 12/07. Data from CEC NV: assumes Nellis and Nevada Solar online in 2007. NJ, CO, AZ: Assumes 2007 solar matches RPS requirement 14
Solar Energy (cont d) Large solar-thermal plant is lowest cost source of solar power today Same size PV would cost much more Photovoltaic systems have been in short supply worldwide, but situation starting to improve PV can be used in smallscale distributed applications 15
Utility s Load vs. Solar Output Load MW NPC Load Profile 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour NPC - Annual Average NPC - July Average Output MW Typical Solar Output Curve in July 60 6% 50 5% NPC Load % 40 4% 30 3% 20 2% 10 1% 0 0% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour Normal Solar Output Semi-Cloudy Day (7/23/07) % of NPC Daily Load % of Annual Total % of Annual Total NPC Annual Load Curve 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Month NPC % Solar Annual Output Curve 16% 14% 12% 10% 8% 6% 4% 2% Net Capacity Factor - 18-25% 0% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Month Solar Output 16
Wind Development Resource not comparable to Great Plains, but adequate Must compete on price with geothermal Plan to add >400 MW by 2012 Currently evaluating sites Siting issues: - rough terrain - federally owned lands - military use of airspace 17
Wind Energy (cont d) Strong proven wind resource is critical to project viability and cost of energy Intermittent energy requires other generation sources to compensate to maintain steady supply 27-33% average capacity factor Typical 100 MW project may cost $200 MM to build Cost has increased considerably in last three years due to steel costs, weak dollar, and high global demand 18
Utility s Load vs. Wind Output Load MW 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Output MW 160 140 120 100 80 60 40 20 0 NPC Load Profile 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour NPC - Annual Average Typical Wind Output Curve NPC - July Average 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Hour Annual Average Output Average Wind Output - July Example of Actual Hourly Output in July (7/20/07) % of Annual Total % of Annual Total NPC Annual Load Curve 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Month NPC % Wind Annual Output Curve 14% 12% 10% 8% 6% 4% 2% 0% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Month Wind Output 19
Turbine Prices Up 60% Major Causes: 1) Euro/USD rate 2) Global demand 3) Steel prices 4) Transport costs Source: May 30, 2007 LBNL Report 20
Renewables Value Chain Equipment Manufacturing Project Development Finance Construction Asset Ownership & Operation Global sourcing of equipment and components U.S. and European specialists provide scientific, engineering, legal and financial expertise Three distinct industries: 1) geothermal, 2) wind, and 3) solar (many flavors), and other niche technologies Many big players are entering wind and solar, with varying degrees of vertical integration to gain advantage Nevada has a strong position in Geothermal due to its resource potential, development history, and presence of industry leaders 21
Summary Renewable energy diversifies our supplies, avoids emissions, and helps us meet Nevada s rapid growth By 2015 we expect to have spent over $2 billion on renewable energy Customers want it, policy-makers want it, and we are bringing it into the mainstream We are taking an active role in encouraging and developing renewable energy facilities Utilities are increasingly seeking to invest in renewables, vs. purchase under long-term PPAs Nevada is leading the way on geothermal and solar development, and will add wind to its mix 22