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Marketing Montana’s Energy IndustriesA presentation requested by the Energy and Telecommunications Interim Committee and fulfilled by the Montana Office of Tourism and Business Development
Sean Becker – Division AdministratorMontana Office of Tourism and Business Development
Tom Kaiserski – Bureau ChiefResearch and Information Services September 29th, 2017
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 1
MONTANA DEPARTMENT OF COMMERCE
The Department of Commerce is the marketing engine for the State of Montana. Montana’s energy industry is connected to every sector of the state’s economy either through production or consumption. Thus, enhancing this key industry enriches the economy statewide.
SLIDE 2ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 2
Research and Information Services BureauThe Research and Information Services (RIS) Bureau obtains, actualizes, and provides quality information to the public and private sectors for the economic enhancement of the State of Montana.
• Industry Analysis• Market Analysis• Targeted Economic Development• Private to Public Sector Business Facilitation• Data Collection and Analysis• Dissemination of Quality Information• 2020 Census• Statutorily mandated central depository of information - MCA 90-1-109
MONTANA DEPARTMENT OF COMMERCE
Thank you for the opportunity to discuss our work. We take great pride in delivering economic benefit to the state and its citizens.
SLIDE 3ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 3
Today’s Topics:
Marketing and Developing Montana’s Energy Sector• Montana Energy Missions• Montana Energy Value Proposition• Load Growth through Industrial Development
MONTANA DEPARTMENT OF COMMERCE
Acting on Governor Bullock’s Energy BlueprintThe Departments of Commerce and Environmental Quality are supporting Governor Office staff in implementing the Energy Blueprint.
SLIDE 4ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 4
Energy MissionsExecutive branch staff have traveled to key jurisdictions in the west to solidify and enhance the state’s presence in these energy markets.
Oct. 2016 - AlbertaFeb. 2017 - Seattle, PortlandJune 2017 - Salt Lake, Spokane, PolsonOct. 2017 - Jackson (WY)
MONTANA DEPARTMENT OF COMMERCE
Acting on Governor Bullock’s Energy BlueprintThe Department of Commerce as well as Environmental Quality are supporting Governor Office staff in implementing the Energy Blueprint.
SLIDE 5ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 5
Energy MissionsOct. 2016 - Alberta
Participants:• Alberta Ministry of Energy, Alberta Electric
System Operator (AESO), NaturEner USA
Outcomes:AESO is looking to relieve transmission constraints on the Montana Alberta Tie Line and that will increase Montana market access to the north and west in Canada
MONTANA DEPARTMENT OF COMMERCE
Acting on Governor Bullock’s Energy BlueprintThe Department of Commerce as well as Environmental Quality are supporting Governor Office staff in implementing the Energy Blueprint.
SLIDE 6ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 6
Energy MissionsFeb. 2017 - Seattle, Portland
Participants:• Gov. Inslee staff (WA), WA Public Utility
Commission, Puget Sound Energy• Gov. Brown staff (OR), OR Public Utility
Commission, Portland General Electric
Outcomes:Open discussions regarding operations at Colstrip, development of a Montana Energy Value Proposition
MONTANA DEPARTMENT OF COMMERCE
Acting on Governor Bullock’s Energy BlueprintThe Department of Commerce as well as Environmental Quality are supporting Governor Office staff in implementing the Energy Blueprint.
SLIDE 7ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 7
Energy MissionsJune 2017 - Salt Lake, Spokane, Polson
Participants:• Gov. Herbert staff (UT) and Rocky
Mountain Power• Avista Corporation• Energy Keepers
Outcomes:Lines of communication improved with our regional energy partners; RMP plans to invest $2.2 billion by 2020 into wind and transmission
MONTANA DEPARTMENT OF COMMERCE
Acting on Governor Bullock’s Energy BlueprintThe Department of Commerce as well as Environmental Quality are supporting Governor Office staff in implementing the Energy Blueprint.
SLIDE 8ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 8
Energy MissionsOct. 2017 - Jackson (WY)
Participants:• Wyoming Infrastructure Authority• Relevant industry and utilities may also
participate
Outcomes:Meeting yet to occur. Topics to be discussed will include: operation of Colstrip, transmission development in WY, target markets of MT & WY electrons
Montana Energy Value Proposition
SLIDE 9ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 9
Montana is an integral part of one of the most diverse & reliable energy systems in the world.A backbone of developed hydro.Regional transmission spanning thousands of miles.Fossil fuel, baseload generation.A rich diversity of renewable energy.
This system is the envy of the world…but it is changing.
MONTANA DEPARTMENT OF COMMERCE
Montana Energy Value Proposition
SLIDE 10ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 10
MONTANA DEPARTMENT OF COMMERCE
Markets & DevelopmentsFour factors:• Resistance to carbon• Complexity of renewables• Flat Load Growth in US Markets• Difficulty in developing linear infrastructure
Montana Energy Value Proposition
SLIDE 11ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 11
MONTANA DEPARTMENT OF COMMERCE
Markets & DevelopmentsResistance to carbon• Montana’s largest, existing energy markets are moving away from
carbon emitting generation• Portland General Electric retirement of Boardman coal plant• Puget Sound Energy announces Green Direct program & Centralia
closure in 2025
Canadian Markets• AB: Coal phase out & 30% RPS by 2030 and requires 5000MW of new
renewable generation• SK: Coal phase out by 2030, 50% RPS by 2030
Montana Energy Value Proposition
SLIDE 12ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 12
MONTANA DEPARTMENT OF COMMERCE
Markets & DevelopmentsComplexity of increased renewable generation• Continued operation of renewable facilities is providing data and
information needed to maximize system efficiencies• Variability and capacity factors are being addressed through regional
diversity• An increase in available capacity will also allow a more integrated
regional system to respond to demands and meet reliability requirements
Montana Energy Value Proposition
SLIDE 13ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 13
MONTANA DEPARTMENT OF COMMERCE
Markets & DevelopmentsFlat Load Growth in US Markets• Conservation, efficiency, and other factors have affected energy demand
and load growth in the PNW • Increased natural gas supplies and low prices are influencing the market
Montana Energy Value Proposition
SLIDE 14ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 14
MONTANA DEPARTMENT OF COMMERCE
Markets & DevelopmentsNew transmission is increasingly difficult to develop.• Bonneville Power Administration abandons I-5 transmission line• BPA is moving away from “the traditional approach of primarily
relying on new construction to meet changing transmission needs, to embracing a more flexible, scalable, and economically and operationally efficient approach to managing our transmission system,” BPA CEO Elliot Mainzer
Montana Energy Value Proposition
SLIDE 15ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 15
MONTANA DEPARTMENT OF COMMERCE
Markets & DevelopmentsTakeaways:• Flat Load Growth in US Markets
• Replacement power needed for retiring CO2 emitters• Resistance to carbon
• Diversify MT’s product portfolio with caveat that access to those products is tied to Colstrip operations
• Complexity of renewables• MT is the diversity that the PNW system needs
• Difficulty in developing linear infrastructure• Solidifies need to maximize current system
Montana Energy Value Proposition
SLIDE 16ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 16
MONTANA DEPARTMENT OF COMMERCE
Verification of Montana Assets & ResourcesMontana renewables verified with increasing data• MT wind has a 64% contribution credit to PNW load demand compared
to Columbia Gorge wind’s 8% contribution credit• New models show the Gordon Butte Pumped Hydro project
outperforming natural gas in frequency response, regulation up/down, spinning reserve, non-spinning reserve.
Possible transmission capacity upgrades available• M2W Project would increase capacity within the BPA transmission
system from the Townsend west• Colstrip 500kV Upgrade would increase capacity within the Colstrip
transmission system from Townsend east• No new siting, majority of environmental review complete• Colstrip 3 & 4 provide necessary inertia to line operations
Montana Energy Value Proposition
SLIDE 17ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 17
MONTANA DEPARTMENT OF COMMERCE
Verification of Montana Assets & ResourcesThe case for Colstrip• Colstrip 3 & 4 are some of the best coal gen assets in the nation• Colstrip 3 & 4 provide necessary inertia to 500kV line operations• PRB coal is the best quality coal for electric generation in the US• US DOE sees Colstrip as an ideal location for development of CCUS
technologies - Governor is talking to Talen Energy about current DOE FOA to fund large-scale pilots for transformational coal technologies
Colstrip and the region• PNW jurisdictions understand the role the generation facility plays in
maintaining the reliability of the current grid system.• RIS meeting with the Coal Country Coalition on diversification• RIS to meet with the Wyoming Infrastructure Authority to discuss
future coal operations in the PRB, and leveraging regional transmission
Montana Energy Value Proposition
SLIDE 18ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 18
MONTANA DEPARTMENT OF COMMERCE
Taking the LeadWith strategic investment MT, WA, & OR can build an energy system that is the example for the west, the country, and the globe.
• A backbone of hydroelectric generation• Coal generation with potential CCUS• High capacity Montana wind generation• Pumped Hydro firming and storage• Increased transmission capacity – upgrade
existing and exploring new build opportunities• Columbia Gorge wind generation• Solar generation• Utilization of energy imbalance markets• Utilization of higher frequency scheduling
Montana Energy Value Proposition
SLIDE 19ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 19
MONTANA DEPARTMENT OF COMMERCE
Taking the LeadThe department is engaging in jurisdictions to the west, north, and south through the Governor’s Energy Missions.
As opportunities present themselves, the department is positioning the state at the head of the regional conversation with key energy partners.
The state has an incredible opportunity to provide a unique portfolio of energy resources that will benefit expanding markets.
Montana Energy Value Proposition
SLIDE 20ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 20
MONTANA DEPARTMENT OF COMMERCE
Expanding Montana’s Energy DemandThe bureau’s industry development program is working to attract substantial commercial and industrial load growth to the state.
Load growth development targets include:• Data Centers• Light Manufacturing• Ag Processing• Refining• Photonics• And more…
MONTANA DEPARTMENT OF COMMERCEResearch and Information Services Bureau
The department and RIS are actively targeting industry companies to increase their business presence in Montana. Proactively working to attract industries best suited to the state is a core duty of the bureau.
Increasing Electric Load: Data Center DevelopmentA report was published in 2014 by the department which found multiple benefits to operating data centers in Montana. This information helped to solidify a recent development in the state.
Contents include:• Understanding the Industry• Market Analysis• Case Studies• Montana’s Competitors• SWOT Analysis
TARGETED INDUSTRY DEVELOPMENT
Large data centers generally need 60
megawatts of power 24/7/365.
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 21
MONTANA DEPARTMENT OF COMMERCEResearch and Information Services Bureau
The department and RIS are actively marketing to companies in targeted industries. Montana is often overlooked by various industries; the department’s award winning marketing division helps to put Montana in front of key audiences.
TARGETED INDUSTRY DEVELOPMENT
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 22
Direct Marketing
MONTANA DEPARTMENT OF COMMERCEResearch and Information Services Bureau
The department and RIS are actively targeting industry companies to increase their business presence in Montana. Proactively working to attract industries best suited to the state is a core duty of the bureau.
Increasing Electric Load: Ag ProcessingA report published in 2014 by the department highlighted benefits to operating a specialty malt house in Montana. This information lead to Montana Craft Malt’s $15M development in Butte.
Contents include:• Understanding the Industry• Market Analysis• Factors of Development• Case Studies• Supportive Ventures• Montana’s Competitors• SWOT Analysis• And more…
TARGETED INDUSTRY DEVELOPMENT
Ag processing is often a targeted industry by RIS
as the state’s assets generally meet the
industry needs.
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 23
MONTANA DEPARTMENT OF COMMERCEResearch and Information Services Bureau
The department and RIS are actively targeting industry companies to increase their business presence in Montana. Likewise the department rapidly responds to business inquiries about operating in the state.
Rapid Business Inquiry Response: RefiningA large, international LNG processor showed interest in establishing a Montana LNG processing facility. The department quickly responded with a full analytical document.
Contents include:• Available, qualified workforce• Tax Environment (2015 = 6th Best Business Tax Climate)• Tax Incentives• Financing Opportunities• Local/State Market Analysis• State Resources• Local development partners and industry contacts
TARGETED INDUSTRY DEVELOPMENT
SLIDE 24ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 24
MONTANA DEPARTMENT OF COMMERCEMontana Office of Tourism and Business Development
Contributions to Industry PublicationsCoal People Magazine Bakken Oil Business Journal
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 25
Maintaining an industry presence is essential for a small state like Montana. The bureau contributes to industry publications by authoring articles and occasionally purchasing advertising.
MONTANA DEPARTMENT OF COMMERCEMontana Office of Tourism and Business Development
Contributions to Industry Reports
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 26
Maintaining an industry presence is essential for a small state like Montana. The bureau contributes to industry publications by authoring articles and occasionally purchasing advertising.
The American Jobs Project (AJP) is a nationally focused, research-based project dedicated to U.S. economic growth through advanced industries.
AJP contacted the bureau in fall 2016. Discussions with Tom Kaiserski led to the research, findings, and publishing of this report. Third party validation of the this nature is extremely beneficial in attracting quality industry developments into the state.
“Montana is well positioned to benefit from rising global demand for photonics given its existing cluster of over thirty companies, its leading research university with photonics expertise, its affordable cost of living, and its attractive quality of life.”
MONTANA DEPARTMENT OF COMMERCEMontana Office of Tourism and Business Development
Utilizing Research & Information for Industrial Development
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 27
Maintaining an industry presence is essential for a small state like Montana. The bureau contributes to industry publications by authoring articles and occasionally purchasing advertising.
RIS extended an invitation to the report’s primary author. Kate Ringness, to attend the Innovate MT Symposium in Billings, and a meeting with the Montana Photonics Industry Alliance in Bozeman. Mrs. Ringness discussed the findings of the report and created list of top actions items with industry leaders.Build out the Montana Supply ChainSurvey Existing Photonics Companies in MontanaConnect Companies to BlackstoneFacilitate Equipment SharingPut Montana on the Map via StrategicSecure Additional Funding for the MBRCTPlan an event to which all supporting players in photonics attendFacilitate Grant Writing/ Collaboration for photonics research
Thank you.
Sean Becker – Division AdministratorMontana Office of Tourism and Business DevelopmentSeanBecker@mt.gov
Tom Kaiserski – Bureau ChiefResearch and Information ServicesTKaiserski@mt.gov
Montana Office of Tourism and Business Development406.841.2870
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 28
Sean Becker – AdministratorMontana Office of Tourism and Business Development
• Bachelor’s Degree in Psychology• Master’s Degree in Industrial & Organizational Psych • 17 years experience in market research, finance, and
economic development• 5 years operating a manufacturing business in Gallatin
County• 10 years as the Research Director of a research based
market assessment group. • Former Mayor of Bozeman• Retired president of the Northern Rocky Mountain
Economic Development District• Former member of Governor Bullock's Economic
Development Advisory Council• City of Bozeman Economic Development Advisory Board
Member• Bozeman Area Chamber of Commerce Board Member• Small Business Development Professional for the Montana
Community Development Corporation • Graduate of Leadership Montana, The National
Development Council Economic Development Finance Professional Program and serves on numerous public and private boards
ENERGY & TELECOMMUNICATIONS (ETIC) – SEPTEMBER 2017MT DEPARTMENT OF COMMERCE SLIDE 29
Tom Kaiserski – Bureau ChiefResearch and Information Services
• Bachelor’s Degree in Geography, Montana State University
• 30 year’s-experience in Montana economic development and planning
• Past president of the Western Interstate Energy Board • Certified Economic Development Finance Professional
by the National Development Council• Current proxy member of the Montana Agriculture
Development Council• Member of the MDOC Grant and Loan Review
Committee• Served as a member of the Montana Board of Research
and Commercialization Technology • Former Stillwater County Planning Director • First Economic Development Coordinator of the
Beartooth RC&D Economic Development District• President of The Julius Foundation, a Helena based
501(c)3 charitable organization
MONTANA DEPARTMENT OF COMMERCEMontana Office of Tourism and Business Development
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