Integrated Resource Planning AnthonyCadorin, Energy ...
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Integrated Resource Planning Anthony Cadorin, Energy Resources Coordinator
Transcript of Integrated Resource Planning AnthonyCadorin, Energy ...
Integrated Resource PlanningAnthony Cadorin, Energy Resources Coordinator
Overview Mesa Utility Background Integrated Resource Planning (IRP) Process Mesa Current Loads and Resources Industry Trends Resource Options Putting it all Together
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City of Mesa Electric Utility
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City of Mesa Electric Utility Founded in 1917 5.5 Square Miles 16,586 Customers
13,772 Residential 2,593 Commercial 184 Interdepartmental City 37 Other Public Authority
City Largest Customer
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Who We Are
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Rate Basics Fixed Customer Charge
Constant in each season regardlessof use
Variable Charge Proportional to energy use
Energy Supply Pass Through Electric Energy Cost Adjustment
Factor (EECAF)
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“DISTRIBUTION RATES”
“ELECTRIC SUPPLY COST”
City of Mesa Electric Utility Summer Energy Assistance Program Solar Photovoltaic Program
47 Customers, ~800 kW 19% Renewable Energy Continued reduction in supply costs System Efficiency Improvements
12 kV Conversion complete Capacitor additions Transformer replacements
APPA RP3, Safety Awards
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City of Mesa Electric Utility Benefits
Inexpensive electric rates for City buildings Large general fund transfer City retains decisions for electric supply, rates, aesthetics Competitive rates with surrounding utilities
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City of Mesa Electric Utility
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Safe Energy
Reliable Energy
Economic Energy
Survey Question 2 How do you think Mesa’s residential electric rates
compare to SRP’s?
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City of Mesa Electric Utility –Economic Energy
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-16.0%
-14.0%
-12.0%
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%12/13 13/14 14/15 15/16 16/17 17/18
Comparison, Mesa Electric vs SRP - Average Residential Bill
City of Mesa Electric Utility –Reliable Energy Maintenance – IR Scanning Lifecycle replacement – Wood to Steel or Concrete System Hardening – Outage Protection Devices, Trip
savers
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82.177
20.325 21.437
103.23797.452
44.481 48.082
21.695
0
20
40
60
80
100
120
Min
utes
per
Cus
tom
er
SAIDI for the Electric Utility by FY
City of Mesa Electric Utility – Safe Energy 12 years, only two lost time accidents
Recent record of 1,648 Days in a row 2014 APPA Safety Award, First Place
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IRP Requirements Identify and compare of all practicable energy
efficiency and energy supply resource options. Include action plan with timing set by utility. Describe efforts to minimize adverse environmental effects
of new resource acquisitions. Provide ample opportunity for full public
participation. Conduct load forecasting. Include brief description of measurement strategies for
options identified in IRP to determine whether objectives are being met.
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IRP Process1. Determine
Resource Needs
2. IdentifyAvailable
Options to Meet Needs
3. Account for Customer and Community
Input
Analyze & Iterate to Determine “Best”
Option
Economic, Safe, Reliable Power Supply & Demand Side Resources 19
IRP is Contractual Requirement for Federal Hydro supply contracts
IRP Next Steps September 13th – Second Meeting Present Results to Council with Recommendations for
more feedback October
Finalize Plan November
Council Approval of Plan December
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Mesa’s 2012 IRP Strategies 1. Continue with Long and Short-Term contractual
arrangements
2. Stage Contractual Arrangements to Allow for Unconventional Opportunities in the Near Future
3. Position Mesa Energy Resources as a “Resource for Energy” Create opportunities for customers to learn more about
energy and make decisions about saving energy
4. 12 Month Solar PV Pilot Program5. Pursue Hoover Power
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Important Changes Since 2012 Mesa implemented Customer PV Net Metering
Program Mesa applied for, but ultimately declined Hoover Renewable energy prices are now competitive with
conventional resources Conventional (natural gas) energy prices very
inexpensive Conventional contracts shaped and staggered Enabled with additional counter-parties Continue to look for opportunities to save
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Results
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$45.70 $45.38
$42.52
$46.14
$40.73$39.78
$37.57
$25.00
$30.00
$35.00
$40.00
$45.00
$50.00
11/12 12/13 13/14 14/15 15/16 16/17 17/18
Elec
tric
Pow
er S
uppl
y C
ost (
$/M
Wh)
Fiscal Year
Electric Power Supply Costs
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25
87.4
91.4
93.8
91.4
84.0
87.0
83.0 83.084.0
82.8 82.781.9
85.0
87.188.3
95.497.1
96.2 95.6
90.9 90.2
86.5
88.787.6
86.385.2 85.4
88.3 88.4 88.690.1
91.192.1
93.194.1
95.196.0
97.098.0
99.0
60.0
65.0
70.0
75.0
80.0
85.0
90.0
95.0
100.0
105.0Pe
ak L
oad
at R
oger
s (M
W)
Actual and Design Day Electric Peak by Calendar Year
Actual Peak @ Rogers Predicted Design Day Peak BAU Projection
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0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000Ju
l-04
Mar
-05
Nov
-05
Jul-0
6M
ar-0
7N
ov-0
7Ju
l-08
Mar
-09
Nov
-09
Jul-1
0M
ar-1
1N
ov-1
1Ju
l-12
Mar
-13
Nov
-13
Jul-1
4M
ar-1
5N
ov-1
5Ju
l-16
Mar
-17
Nov
-17
Jul-1
8M
ar-1
9N
ov-1
9Ju
l-20
Mar
-21
Nov
-21
Jul-2
2M
ar-2
3N
ov-2
3Ju
l-24
Mar
-25
Nov
-25
Jul-2
6M
ar-2
7N
ov-2
7Ju
l-28
Mar
-29
Nov
-29
Jul-3
0M
ar-3
1N
ov-3
1Ju
l-32
Mar
-33
Nov
-33
Jul-3
4M
ar-3
5N
ov-3
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Customer Connections by Month - Historic and Projected
Residential Commercial InterDept Pub Auth
Actual Projected
Conservation/Load Degradation
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8,500.0
9,000.0
9,500.0
10,000.0
10,500.0
11,000.0
11,500.0
Consumption per Residential Customer - 14 Year
Actual Wthr. Norm.
Survey Question 3 Where do you think Mesa gets its power from?
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Colorado River Storage Project (Renewable Hydro),
14,095,091, 4%
Parker Davis Project (Renewable Hydro),
49,252,990, 15%
Base Contract, 127,458,000, 38%
July-August Peak Contract, 9,622,400, 3%
Summer Peak Option Contract, 23,745,600, 7%
Variable Base Contract, 54,361,438, 16%
Summer Peak Contract,
34,181,015, 10%
Customer-Owned Solar PV, 431,680, 0%
Market Power (through WAPA), 4,699,000, 2%
Market Power (Wholesale Purchases), 16,744,246, 5%
Fiscal Year 17/18 Power Supply at Rogers
Parker Davis, 10.4 MW, Exp. 2028
CRSP, 4.3 MW, Exp. 2024 CRSP Renewal, 4.3 MW, Exp. 2044
Constellation Base, 15 MW, Exp. 9/30/2018
CitiGroup Base, 15 MW, Exp 3/31/2020, 15
SENA Sculpted Base 10 MW, Exp.
12/31/2018
SENA 1B Summer Peak, 15 MW, Exp. 9/30/2020
Constellation July-August Peak, 10 MW, Exp 8/31/2020
Constellation Day Ahead, 10 MW, Exp. 10/31/2018
Customer-Owned Solar
Market Purchased Energy
Average Summer Peak at Rogers
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40
60
80
100
120
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Peak
Dem
and
and
Reso
urce
s at
Rog
ers (
MW
)City of Mesa Electric Utility Power Requirements and Resources (MW) by Year at
Rogers Substation
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RESOURCE NEEDOpportunity for renewable supply, 10/2020
Opportunity for renewable supply, 1/2019
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Current Loads and Resources – Capacity (MW)
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Industry Trends Renewable resource pricing continues dropping so
that new renewable resources are competitive (“sticker price basis”) with natural gas resources “Sticker Price”: Does not account for timing (4 hour
delay for peak solar) of the energy nor the “firmness” Effects on Mesa: Transition from a high level of 1-5 year
firm, conventional resource contracts to a mix of firm, conventional resource contracts and renewable resources
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Economics of Renewables vs. Gas
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Economics of Renewables
35Source: NextEra CFO Energy-Power Conference Presentation
Economics of Renewables
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APS Solana
TEP
Xcel RFP
Industry Trends Renewable resource pricing continues dropping so
that new renewable resources are competitive (“sticker price basis”) with natural gas resources
Many coal plants have a planned retirement date This is in flux due to administration’s new exec. order
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Coal Retirements
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Plant Unit Owner Capacity (MW)
Built Retirement
Retir
ed
(2,4
17 M
W)
Four Corners 1,2,3 APS 633 1963, 1964 12/2013
Sundt 1 TEP 173 1967 2015
Cholla 2 APS 114 1962 10/2015
Apache 2 AEPCO 204 1979 1/2017
San Juan 2,3 PNM 924 1976, 1979 12/2017
San Juan 1 PNM 369 1973 3/2018*
Plan
ned
Retir
emen
ts
(3,9
79 M
W) Navajo 1-4 Mult. 2,409 1974-1976 2019
San Juan 4 PNM 555 1979 2022
Cholla 1&3 APS 601 1978 + 1980 2024
Cholla 4 APS 414 1981 2025
Ope
ratin
g (4
,173
MW
) Four Corners 4,5 APS 1,636 1969, 1970No
planned retirement
date
Coronado 1,2 SRP 773 1979, 1980
Apache 1 AEPCO 204 1979
Springerville 1-4 SRP, TEP 1,560 1985-2009
CO2 and Water Emissions
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134,000,000
135,000,000
136,000,000
137,000,000
138,000,000
139,000,000
140,000,000
130,000
135,000
140,000
145,000
150,000
155,000
160,000
165,000
170,000
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Gal
lons
of W
ater
Met
ric
Tons
of C
O2
City of Mesa Electric Utility - Estimated Metric Tons of CO2 and Gallons of Water by Fiscal Year due to Power Generation
Metric Tons of CO2 Gallons of Water
Industry Trends Renewable resource pricing continues dropping so
that new renewable resources are competitive (“sticker price basis”) with natural gas resources
Many coal plants have a planned retirement date This is in flux due to administration’s new exec. order
Negative pricing has reached Arizona and will continue through the near term future
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Duck Curve & Negative Pricing
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3/28/2018 Net Demand, California ISO
Duck Curve & Negative Pricing
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-$20.00
-$10.00
$0.00
$10.00
$20.00
$30.00
$40.00
$50.00
$60.00
Location Marginal Pricing: Palo Verde, APS, CAISO 3/2017
Negative prices: Utilities are paying people to take their power
Large spike in power due to solar falling off, large ramp up
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Demand Side Management (DSM)• Customer-
owned Generation
• Customer-owned Storage
• Energy Efficiency & conservation
Resource Options
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Distribution LoadTransmissionGeneration
• Conventional Market Purchased Power• Owner (%) Participation or PPA
• Wind Farms• Solar Farms• Conventional Resources• Hydroelectric Resources • Large Storage Projects
Energy Resources Department
Citizens, Businesses
Sole Owner or PPA• Solar Project• Natural gas
generators• Utility scale
batteries
Conventional Market Purchased Power “Types” of power Take and Pay – Dispatchable Take or Pay – Block As Available – Unit Contingent
Readily available Reflect market at the time of purchase Highly competitive Non-Specific Resources
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Renewable Energy “Farms” Large energy projects, generally in remote areas Most competitively priced renewable resources Can be sourced with storage Most optimized resource profiles Difficult to properly time and execute, transmission is
a challenge
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Conventional Resources Participation or Tolling Agreement with known power
plant Resource exclusivity Better known price controls Can dispatch at will Biomass is renewable option Stuck with specific technology Unit contingency
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Hydroelectric Resources Dispatchable
Subject to Primary Design Run of River Agricultural Irrigation Seasons
Very low cost Long term stability Subject to drought Politics can enter discussions
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Distribution Level Solar Less expensive than rooftop solar Can serve multiple purposes
Creation of event spaces No transmission losses Can be sited to (intermittently) remedy distribution
issues such as voltage support More expensive than utility scale solar
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Distribution Level Generators Assured gas supply Can fix resource pricing Full dispatch control to maximize economics Can be used for multiple purposes
Cogen Backup
Simple to maintain Subject to air quality and noise restrictions
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Distribution Level Storage Capital cost is rapidly dropping Can be sited to address multiple issues
Power quality, voltage sag, etc. Quiet, emissions free (on-site) Still expensive Only shifts load
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Demand Side Management Often inexpensive up front cost to reduce load May alleviate resource needs and capital needs No guarantees on load reduction
Jevons Paradox Lowers revenue, placing upward pressures on rates
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Customer-Owned Generation Most expensive generation source with net metering
Changing finance structure could help utility & customer APS: Rooftop lease structure Mesa’s demographics are a challenge to conventional
customer-owned financing
Reduces revenues, placing upwards pressure on rates May affect distribution system operation depending on
generator location and concentration
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Customer-Owned Storage Increases revenue due to battery inefficiencies If paired with TOU rates, can reduce peak demand
without affecting energy consumption
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Non-Options Nuclear
Small Modular New Coal Sole owners of a large conventional plant Diesel generation Untested, nascent technology
Fuel cells, Tidal power,
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Metrics For Evaluation1. Bills Impacts/Affordability2. Reliability3. Safety4. Environmental Impacts &
Stewardship
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5 Decision Pathways1. Renewable Energy Goals
Examples: Business as usual 15% by 2025 (Arizona 2006 Renewable Portfolio Standard) 30% by 2030 (Arizona Proposed RPS) 50% by 2030 (California 2015)
100% by 2045 Carbon reduction to 1990 levels (Original Kyoto protocol) Renewable addition up to % bill impact Renewable addition up to a specific comparison to our peer utilities Renewables addition up to SRP rate parity
Largest Influencer of ultimate portfolio cost Need the ability to react to changing industry conditions 58
5 Decision Pathways2. Customer Programs
Maintain Customer-owned PV Program? Incentive programs?
AC Upgrade Energy Audits
Green rates? Time of use rates? Electric Vehicle incentives or rates? Customer-owned storage?
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5 Decision Pathways3. Distribution Level Generation
How much distributed solar? Event space creation Power generation Shade for staff and public parking
How much distributed natural gas generation? Reduces market purchases during peak times Backup power in the case of transmission or some circuit
outages Opportunities for cogeneration
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5 Decision Pathways4. Hydro Power
Staff recommends keeping hydropower in all cases
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5 Decision Pathways5. Conventional Power Purchases
Base supply options are almost all conventional Can be augmented with Renewable Energy Credits
Participation in a large project an option? These fall into place around the other decisions
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Why don’t we meet 57 MW resource need with solar?
57 MW Resource Need @ 4 PM Peak = 109.6 MW of Solar (without storage)
1 MW Solar1 = 8.3 Acres 109.6 MW Solar = 909.7 Acres Total Cost: $278 Million Annual: $20 million
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Typical Week Loads and Resources
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Current Resources – July Week
Replace with Solar – July Week
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More Optimal Solar – July Week
Replace with Solar – July Week
Balance How to increase rates
Large subsidies to customers to reduce energy without reducing demand
Very fast integration of renewable energy Large amounts of small renewable energy installations
How to keep rates stable and reasonable DSM Programs that target demand Move towards renewable energy as economically feasible Plan for an amount of dual use local solar energy
projects with limits
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September 13th Recap of this info Presentation of some example scenarios Discussion of your feedback
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Feedback, Questions, Comments
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Anthony CadorinEnergy Resources [email protected]
Pedro [email protected]
