ArizonaCorporationCommission

Energy Workshop

2001-2002

February 16, 2001

3/16/01ACC Energy Workshop 2001/2002 2

Agenda

• California Energy Situation Update - Staff• Energy Preparedness for 2001 and 2002

– Arizona Public Service Company– Salt River Project– Tucson Electric Power– Arizona Electric Power Cooperative – Western Area Power Administration– Southwest Gas Corporation

• Contingency Response Plan - Staff

3/16/01ACC Energy Workshop 2001/2002 3

California Update

3/16/01ACC Energy Workshop 2001/2002 4

Western Interconnection

• WSCC• California• Desert Southwest

WSCC EHV Transmission

Reference: NERC Reliability Assessment 2000-2009 WSCC Data June 2000

Min.Reserve Min.Reserve Requirements

3/16/01ACC Energy Workshop 2001/2002 7

Non-Coincident Peak Demand Reserve Margins1993-1998

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

1993

1994

1995

1996

1997

1998

Pe

rce

nt

WSCC

California

Southwest

EstimatedActual

History of Reserve Margins

Per Dan Nix of CEC 5/17/00

3/16/01ACC Energy Workshop 2001/2002 8

WSCC Generation Additions

TypeExisting Capacity

Added Capacity

2009 Capacity

Hydro 65,279 291 65,570Coal 36,542 -641 35,901

Nuclear 9,213 55 9,268Oil 746 -300 446Gas 36,386 28,422 64,808

Geotherm 3,137 188 3,325Other 6,923 2,219 9,142

158,226 30,234 188,460

3/16/01ACC Energy Workshop 2001/2002 9

WSCC Generation Mix

2009 Generation Mix188,718 MW

21%

5%

7%

0%53%

5%

9%

Exisiting Generation Mix158,504 MW

24%6% 8%

1%

45%6%

10%

Hydro

Coal

Nuclear

Oil

Gas

Geothermal

Other

+28,189

+2,219

Wholesale GasSupply BasinsAnd Pipelines

3/16/01ACC Energy Workshop 2001/2002 11

CAL ISO Peak Demand Load Resource Balance at 7% Operating Reserve

35000

40000

45000

50000

55000

60000

65000

2000 2001 2002 2003

Me

ga

wa

tts

Interruptible

Imports*

Firm Trans.

Pow erplants

Existing *

Imports* additional amounts are available in nominal and 1:5 scenarios, but not necessarily in 1:40 scenario

Existing Resources*This number is derived from base installed resources, less outages or43,856 - 2,572 = 41,104

Nominal Peak Demand

1 in 5 year Demand

1 in 40 year Demand

Resources

California ISO Forecast

Per Dan Nix of CEC 5/17/00

WSCC NON-SIMULTANEOUS TRANSFER CAPABILITIES (MW)

4/00

EAST OF RIVER FLOW (MW)12/2/00 TO 12/9/00

5000

5500

6000

6500

7000

7500

12/02/2000 0:00 12/03/2000 0:00 12/04/2000 0:00 12/05/2000 0:00 12/06/2000 0:00 12/07/2000 0:00 12/08/2000 0:00 12/09/2000 0:00

TIME

FL

OW

MW

'S

EOR

NMC - 1400-1500MKP - 1450-1550LM - 270-290PM - 1200-1300PV-DV 1500-1600PV-NG 950-1150

75%OTC

90%OTC

Arizona EHV TransmissionSan Juan

NavajoGlenCanyon

North Gila

PaloVerde

SilverKingKyreneLiberty

South

Saguaro

Vail

Greenlee

ChollaMohave

MeadFour Corners

Springerville

McKinley

Tortolita

Phoenix

Tucson

Yuma

Westwing Coronado

PinnaclePeak

Transmission Import Constrained Area

3/16/01ACC Energy Workshop 2001/2002 15

AZ-NM-S.NevReserve Requirements (MW)1

Total Min. Reserve Load Year Resources Requirements Responsibility

2000 20,932 20,834 18,244 2001 22,187 22,060 19,486 2002 26,581 24,757 21,930 2003 31,521 25,454 22,541 2004 31,576 26,379 23,367 2005 32,076 27,348 24,225 2006 32,076 28,256 25,030 2007 32,576 29,140 25,813 2008 32,576 30,048 26,617 2009 32,576 30,966 27,4301Per WSCC Information Summary, June 2000

9,186

98

127

1824

1,2422,444

3/16/01ACC Energy Workshop 2001/2002 16

Arizona-NM-S. NVGeneration Mix

Existing Generation Mix24,204 MW

19%41%

15% 1%24% Hydro

Coal

Nuclear

Oil

Gas

2009 Generation Mix35,967 MW

13%

27%

11%

0%

49%

+11,763

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Arizona Generation 2001

Plant YearCapacity

(MW)Gas Use (MMBtu)

Water Use (AF/Yr)

South Point 2001 500 33,100,000 3,060Griffith 2001 520 36,266,640 4,200

Desert Basin 2001 500 33,100,000 3,060W. Phoenix 2001 120 6,619,200 950

1,640 109,085,840 11,270

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New Arizona Generation 2002

Plant YearCapacity

(MW)Gas Use (MMBtu)

Water Use (AF/Yr)

Arlington 2002 580 32,830,250 6,800W. Phoenix 2002 530 29,234,800 4,200Gila River 2002 2,080 128,679,000 13,333Sun Dance 2002 600 28,861,510 950

3,790 219,605,560 25,283

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Staff Summary

• AZ Supply Plans Met WSCC Reserve Req.• 2001 & 2002 Dependent Upon New Plants• Existing Gas Supply & Delivery is Critical and

Subject to Curtailment• New Plants Utilize Fuel Portfolio’s With

Interruptible Gas Purchases But Sell Firm Electric Commodity

• Transmission Capacity Is Marginal With Local Transmission Import Constraints

• Exposed To System Deficiencies In WSCC

3/16/01ACC Energy Workshop 2001/2002 20

What Actions Are Needed?

• Prepare a coordinated load reduction strategy– Voluntary reduction / Price induced ?

– Emergency response

• Encourage distributed resource solutions

• Encourage new EHV transmission to accompany new plant additions

ACC Web Site HTTP://WWW.CC.STATE.AZ.US

3/16/01ACC Energy Workshop 2001/2002 21

Questions ?