W. Bill Booth Chair Idaho James A. Yost Idaho Tom Karier Washington Dick Wallace Washington Bruce A. Measure Vice-Chair Montana Rhonda Whiting Montana Melinda S. Eden Oregon Joan M. Dukes Oregon January 6, 29 MEMORANDUM TO: FROM: SUBJECT: Power Committee Maury Galbraith Draft Sixth Plan Electricity Price Forecasts At the December Power Committee meeting, staff presented preliminary forecasts of future wholesale power market prices. The preliminary forecasts reflected the results of reducing the number of load-resource zones and updating the demand forecast used in the s version of the AURORA xmp Electric Market Model. At the January Power Committee meeting, staff will present additional forecasts that reflect the results of an updated fuel price forecast, an updated projection of Regional Portfolio Standard (RPS) resource development, and a new assessment of the availability and cost of new generating resource technologies. The final wholesale power price forecast will be input into the s Regional Portfolio Model as a projection of the long-term trend of future wholesale electricity prices. Shorter-term electricity price risk, due to such factors as disequilibrium of supply and demand, and seasonal volatility due to hydro conditions and other weather related events, are also incorporated into the Regional Portfolio Model, but are not reflected in the long-term trend forecasts. The long-term projections of wholesale power market prices are also used by the, regional utilities, and other agencies to help determine the avoided costs of potential energy efficiency measures. The final wholesale power price forecast is not completed for this packet. Presentation materials will be e-mailed and posted on the s web site prior to the Power Committee meeting. 851 S.W. Sixth Avenue, Suite 11 Steve Crow 53-222-5161 Portland, Oregon 9724-1348 Executive Director 8-452-5161 www.nwcouncil.org Fax: 53-82-237
Sixth & Electric Power Plan Draft Wholesale Power Price Forecasts Maury Galbraith Power Committee Meeting Missoula, MT January 13, 29
Outline 1. Recap of Major AURORA Updates 2. Update of Fuel Price Forecasts 3. Update of Regional Portfolio Standard (RPS) Resource Development 4. Partial Update of New Generating Resource Options 5. Forecast Wholesale Power Market Prices 2
Major AURORA Updates Reduction in the number of load-resource zones used to model the Western Interconnect Updated transmission links between the modeled load-resource zones Updated demand forecasts for each of the load-resource zones Updated fuel price forecasts for each of the zones Updated hydro condition modeling for the zones Updated inventory of existing generating resources in each of the zones Updated estimates of future Regional Portfolio Standard resource development by zone Updated inventory of candidate resources for future development by zone Improved dispatch parameter for combined cycle combustion turbines Updated carbon dioxide price forecasts 3
Higher Natural Gas Prices Medium Long-term Trend Forecasts for PNW Zones 1. 9. 8. 7. 6. 5. 4. 3. 2. 1.. 4 26$/MMBTu Jan-8 Jan-9 Jan-1 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-2 Jan-21 Jan-22 Jan-23 Jan-24 Jan-25 Jan-26 Jan-27 Jan-28 Jan-29 Jan-3 Draft 6th Plan - PNW Westside Draft 6th Plan - PNW Eastside Interim Forecast - PNW Westside Interim Forecast - PNW Eastside
23 WECC Resource Mix 16, 14, 12, 1, 8, 6, 4, 2, 5 AURORA New RPS Existing 224 226 228 222 22 Annual Average Energy (MWa) 28 21 212 214 216 218
Incremental RPS Energy by State Energy (MWa) 14, 12, 1, 8, 6, 4, 2, WA OR NV NM MT CO CA BC AZ 28 21 212 214 216 218 22 222 224 226 228 23 6
CA Incremental RPS Energy Mix 7, 6, PV Target First Achieved in 215 Energy (MWa) 5, 4, 3, 2, WND HYD GEO CSP 1, BIO 28 21 212 214 216 218 22 222 224 226 228 23 7
WA Incremental RPS Energy Mix 1,2 1, PV WND Full Target Achievement Energy (MWa) 8 6 4 2 HYD GEO CSP BIO 28 21 212 214 216 218 22 222 224 226 228 23 8
OR Incremental RPS Energy Mix 1, 9 PV Full Target Achievement Energy (MWa) 8 7 6 5 4 3 WND HYD GEO CSP 2 BIO 1 28 21 212 214 216 218 22 222 224 226 228 23 9
MT Incremental RPS Energy Mix 6 5 PV WND Full Target Achievement Energy (MWa) 4 3 2 1 HYD GEO CSP BIO 28 21 212 214 216 218 22 222 224 226 228 23 1
WECC Incremental RPS Capacity and Peak Contribution 4, 35, 3, Capacity Peak Contribution Capacity (MW) 25, 2, 15, 1, 5, 28 21 212 214 216 218 22 222 224 226 228 23 11
RPS Summary Eight Western States and British Columbia have Renewable Portfolio Standards Resource Technologies Assumed to Vary by State Modeled 33% Targets in CA, but Assumed CA will Not Achieve Early Targets PNW States Assumed to Achieve Targets Relatively Small Peak Contribution from RPS Resource Additions 12
WECC New Resource Capacity by Technology Capacity (MW) 7, 6, 5, 4, 3, 2, 1, NR 5 MW Wind - MT to PNW NR 1 MW Wind - Local NR 2x45 Aero GT NR 415 MW Adv CC 28 21 212 214 216 218 22 222 224 226 228 23 13
WECC New Resource Peak Contribution by Technology Peak Contribution (MW) 7, 6, 5, 4, 3, 2, 1, NR 5 MW Wind - MT to PNW NR 1 MW Wind - Local NR 2x45 Aero GT NR 415 MW Adv CC 28 21 212 214 216 218 22 222 224 226 228 23 14
WECC New Resource Energy by Technology Energy (MWa) 3, 25, 2, 15, 1, NR 5 MW Wind - MT to PNW NR 1 MW Wind - Local NR 2x45 Aero GT NR 415 MW Adv CC 5, 28 21 212 214 216 218 22 222 224 226 228 23 15
PNW New Resource Energy by Technology Energy (MWa) 6, 5, 4, 3, 2, NR 5 MW Wind - MT to PNW NR 1 MW Wind - Local NR 2x45 Aero GT NR 415 MW Adv CC 1, 28 21 212 214 216 218 22 222 224 226 228 23 16
PNW Total RPS and New Resource Capacity Capacity (MW) 14, 12, 1, 8, 6, 4, 2, Natural Gas Other Renewable Wind 28 21 212 214 216 218 22 222 224 226 228 23 17
New Generating Resource Summary AURORA Tends to Add Natural Gas Resources Combined Cycles to Provide Energy and Capacity Aero's provide Capacity to Maintain Planning Reserve Margins AURORA does Not Add Resources in the PNW until Late in the Planning Period Preliminary Results More Resources Options in Future Model Runs 18
Historic Mid-C Average Monthly On- and Off-Peak Prices Source: IntercontinentalExchange (ICE) 12 11 $41.5/MWh $45./MWh $45.2/MWh $5./MWh $56./MWh 1 9 8 7 6 5 4 3 2 1 $6./MWh Jan-3 Apr-3 Jul-3 Oct-3 Jan-4 Apr-4 Jul-4 Oct-4 Jan-5 Apr-5 Jul-5 Oct-5 Jan-6 Apr-6 Jul-6 Oct-6 Jan-7 Apr-7 Jul-7 Oct-7 Jan-8 Apr-8 Jul-8 Oct-8 On-peak Off-peak 19 26$/MWh
Forecast Mid-C Average Monthly On- and Off- Peak Prices AO_6P_111128_NEWRES_HD 12 11 1 9 8 7 6 5 4 3 2 1 Sep-11 Nov-11 Jan-8 Mar-8 May-8 Jul-8 Sep-8 Nov-8 Jan-9 Mar-9 May-9 Jul-9 Sep-9 Nov-9 Jan-1 Mar-1 May-1 Jul-1 Sep-1 Nov-1 Jan-11 Mar-11 May-11 Jul-11 On-peak Off-peak 2 26$/MWh
Impact of AURORA Updates on Mid-C Wholesale Power Price Forecast 8 Mid-C Power Prices (26$/MWh) 7 6 5 4 3 2 1 Interim Price Forecast Updated Demand/ Fuel Updated RPS Updated New Resources 28 21 212 214 216 218 22 222 224 226 228 23 21
Next Steps Updated transmission links between the modeled loadresource zones Updated hydro condition modeling for the zones Improved dispatch parameter for combined cycle combustion turbines Updated carbon dioxide price forecasts 22