power integrated resource plan pwp presentation€¦ · software; used in past pasadena irps....

Pasadena Water and Power

Power Integrated Resource PlanPWP Presentation

Community Meeting #1Pasadena Central Library

July 18, 2018


PWP ACCOMPLISHMENTS & PROGRAMS

POWER INTEGRATED RESOURCES PLAN: PWP

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Renewable and Coal Annual Production

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80% Eligible Renewable Coal


Green Power Options

• This is a voluntary program> Contributions go towards enabling PWP to bring in additional

renewable power and reduces the city’s dependence on coal• Options

> Residential Green Power (on a monthly basis) $5 extra for 200 kWh, or $10 extra for 400 kWh, or 2.5¢ extra for every kWh of actual usage

> Commercial Green Power (on a monthly basis) $25 extra per block of 1000 kWh, or 2.5¢ for every kWh of actual usage

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2018 IRP BACKGROUND & GOALS


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What is an IRP?

• IRP Details> The IRP serves as a blueprint for PWP to deliver reliable,

environmentally responsible electricity service at competitive rates over a 20-year planning period

> Recent Past IRPs City Council adopted 2009 IRP 3/16/2009 City Council adopted 2012 IRP 3/5/2012 City Council adopted 2015 IRP 6/22/2015

• IRP Development> IRPs are evolving documents IRP will be updated every 3-5 years

> Resources not considered or picked up today might be picked up in future IRPs

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2018 IRP vs. Previous IRPs

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Previous IRPs 2018 IRPNot mandated by State andused to develop to plan for future energy needs

SB 350 Mandate with prescriptive requirements

Developed with Community Input

Developed with Community Input

No strict timeline Due by January 1, 2019Updated every two-three years Mandatory five-year updateFinal product was either a detailed presentation or a report

Mandatory detailed report, specific considerations, and prescribed tables


Key Issues for 2018 IRP

• SB 350 compliance> GHG emission reduction goals/alternatives> RPS goals/alternatives> Impact of transportation electrification> Impact on Disadvantaged Communities Meet reliability requirements

• Future of the Intermountain Power Plant (“IPP”) Natural Gas Repower

• Review of cost effective energy storage, demand response, energy efficiency, etc.

• Criteria of the Balanced Scorecard> Balancing these important issues with reliability, cost and environmental

stewardship> A more detailed scorecard is being developed with input from the Power

IRP Stakeholder Technical Advisory Group

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IRP Scorecard Elements

• Need to find a balance between:> Reliability> Cost> Stability> Environment

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REGULATORY REQUIREMENTS


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Regulations

• CAISO Reliability Requirements> LCR, System RA, Flex RA

• SB350: 2015> 50% RPS by 2030> Requires IRP

• SB32 & AB32> Cap and Trade> GHG Reductions

• SB100: Proposed Bill in 2018> Potential for 100% non-carbon emitting resources> “phase out of fossil fuel generation”

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SB 350 Requirements

• Mandates an IRP for utilities with load > 700 GWh• Due (and approved) before 1/1/19

> IRP written document/report> 4 Required Tables> Supplemental Information> At least one planning scenario that meets the POU IRP

requirements Compliance with PUC 9621

» 40% reduction in greenhouse gases by 2030» 50% RPS by 2030

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2018 IRP PROCESSPOWER INTEGRATED RESOURCES PLAN: PWP

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2018 IRP – Tentative Schedule

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MILESTONE TIMING

PWP 2018 IRP KICKOFF MEETING SEPTEMBER 2017

2018 IRP VENDOR SELECTION MARCH 2018

FORM COMMUNITY STAKEHOLDER GROUP MARCH 2018

COMMUNITY STAKEHOLDER GROUP MEETINGS

APRIL 2018-SEPTEMBER 2018

PUBLIC MEETINGS JULY-AUGUST 2018

IRP DRAFT REPORT SEPTEMBER 2018

IRP COMPLETE OCTOBER 2018

FINAL IRP PRESENTATION TO EAC, MSC AND CITY COUNCIL

NOV/DEC 2018


2018 Power IRP Consultant

• Contracted with Northwest Economic Research LLC (“NWER”)> Subcontractor Siemens/Pace (developed 2009 and

2012 IRP)• Lon Peters, the owner of NWER was the former

IRP Administrator at Glendale Water and Power• Over 30 years of experience

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2018 IRP Outreach Efforts

• The City Manager’s Stakeholder Technical Advisory Group (“STAG”) formed> To represent a cross section of all ratepayer categories> Provide input/direction on the IRP analysis and portfolio selection

• Public Outreach> Community Meetings

> Power IRP Survey posted online 4/30/18• Periodic Updates to MSC, EAC and City Council• Recommendations to EAC, MSC prior to City Council

Approval16

Date Time Location

7/18/18 6-8 PM Pasadena Central Library

8/23/18 6-8 PM Hastings Ranch Library


2018 IRP- Stakeholder Group

• The Stakeholder Technical Advisory Group is made up of a diverse group of 16 Customers and City representatives

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2015 & 2018 STAG MAKE-UP

2015 2018


STAG: Mission and Vision

• PURPOSE: Representative of the Pasadena community to provide input on long term energy supply plan

• STAG MISSION: To assist in the development of the IRP, consistent with mission of PWP> Meet the compliance requirements of SB 350

• STAG VISION: To be a valued contributor to the development of the IRP and contribute to the quality of life in Pasadena> Provide input on power supply issues important to you and or your

organization> Advise on the inputs and deliverables of the IRP

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2018 IRP SURVEYPOWER INTEGRATED RESOURCES PLAN: PWP

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2018 IRP- Survey

• As of this morning, 241 people have responded to the survey

• Public Outreach> Newsletters > Social media (Facebook, twitter, etc.)> Newspaper ads> City bulletin boards> Radio/TV ads> Laemmle Theatre slide

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Key Findings

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• Highest Priority:> High Reliability & Affordable rates

• Preferred RPS Target:> Between 50%-75%

• Customer is willing to pay more for (5-10 % rate increase):> Lower GHG emissions> Higher RPS

Entire Electric Bill


2018 IRP OUTCOMEPOWER INTEGRATED RESOURCES PLAN: PWP

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Impacts of IRP

• Provide direction on the IPP Repowering• Looking to procure resources that meet the

objectives at least cost• Rate Impacts

> Must compare the rates of the base case, scenarios and optimal portfolio

> All rate classes, including Disadvantage Communities are impacted by rate increases

• Provide guidance on> RPS procurement> EE program development> TE program metrics

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IPP Contract Details

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Details Existing Contract Renewal (original)

Renewal (Alternative Repowering)

Fuel Coal Natural Gas Natural Gas

Location Delta, Utah Delta, Utah Delta, Utah

Project Size 1,800 MW 1,200 MW 840 MW

Pasadena Share 108 MW 20 MW 14 MW

Term 40 years 50 years 50 years

Expires June 15, 2027 June 2077 June 2077

Early transition from coal to natural gas reduces air emissions and allows greater procurement of renewable energy. Plan is for IPP to convert to Natural gas in 2025, for a Pasadena share of 14 MW.


DELIVERY CONSTRAINTSPOWER INTEGRATED RESOURCES PLAN: PWP

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Import Capabilities

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Loads > Normal Import Capabilities

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2018 IRP NEXT STEPSPOWER INTEGRATED RESOURCES PLAN: PWP

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Next Steps

• Seek Community Input> Community meetings> STAG meetings until August/September> Survey

• Selecting Optimal Portfolio> Balance: Reliability, stability, costs and environment

• Develop IRP Plan

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Power Integrated Resource PlanConsultant Presentation

Community MeetingPasadena Central Library

July 18, 2018


BACKGROUNDPOWER INTEGRATED RESOURCES PLAN: CONSULTANT

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Consultant: Background

• Lon Peters: Northwest Economic Research> Will develop the IRP written report and compliance filing> Former IRP Administrator of Glendale Water and Power> Pasadena resident> 30+ years of utility experience on the West Coast

• Subcontractors: Siemens and ASWB> Product cost model> Energy efficiency analysis> Transportation electrification analysis> Developed the 2009 and 2012 IRPs for PWP

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Steps for IRP Development

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Steps Details

Step 1 Assemble data on energy use in Pasadena, existing resources and potential future resources

Step 2 Build scenarios: various conditions outside PWP that influence choices and costs (e.g., future prices for conventional fuels and emissions, other resources, and storage, California’s utility regulations)

Step 3 Establish constraints within which cost to serve customers in Pasadena will be minimized (e.g., reliability)

Step 4 Run various cases to find to least-cost portfolios that meet existing or potential future regulatory requirements and expected market conditions

Step 5 Evaluate results: total costs, rate impacts, emission levels, renewable obligations, reliability


Modeling and Scenarios

• AURORA production cost model• Modeling

> Will show a resource portfolio and costs, at a minimum to comply with SB 350

• Preliminary base case complete> The base case is a reflection of information known today

for the period covered in the IRP- including policies and regulations in place today (SB 350) and data based on expected market conditions

• In the process of selecting Scenarios> Scenarios are defined as changes to the assumptions or

inputs of the base case

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Identifying and Evaluating Tradeoffs

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MODELINGPOWER INTEGRATED RESOURCES PLAN: CONSULTANT

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AURORA

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AURORAxmp

CA Market Conditions & Regulations

Hourly Dispatch Optimization

Pasadena System(1) model as its own

zone to represent available transmission

(2) dispatch to balance against the CAISO

AURORA: simulates the Western Interconnection and Pasadena.

AURORA: dispatch software; used in past Pasadena IRPs.

Incorporates market conditions and regulations regarding RPS, reserve requirements, resource adequacy, and distributed generation.

Dispatches the electric system to minimize cost given constraints on generation and transmission.

Ensures service to PWP’s retail load subject to all constraints.


Definitions and Modeling

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Scenarios Portfolios

MWh MW

Combinations of demand-side and supply-side assets that Pasadena assembles to meet retail load at least cost, subject to constraints

Different states of the world outside of Pasadena, which act as constraints on PWP’s possible portfolios

Measure of the amount of electricity generated or used over a period of time

Measure of the amount of electricity that can be generated at one point in time


Sample Scorecard

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Structured IRP Approach

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Establish Future Market Conditions

Critical First Step Identify Objectives, Metrics and Risk Perspectives

Analyze Risks for Each Portfolio

Select “Best” Portfolios

Portfolio Recommendations

Consistent with Objectives

Select Portfolios for Risk Analysis

Define Base and boundary World View Scenarios

Best Portfolio(s) selected on the basis of commercial reality, balance of objectives, and perspective of acceptable risk

Evaluate Resource Options (Screening analysis)

Integration of the financial impact through integrated financial modeling and risk analysis.

Develop mix of Portfolios from Screening analysis and judgment

Screen Resource Options

Develop Base Case


PPA vs. Delivered Cost

• Contract Price (PPA) – Typically Take or Pay• Delivered Price Includes

> Transmission> Time of Delivery (LMP$) Congestion Losses

> Renewable Integration> Resource Adequacy/Reliability

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Solar and Market Prices

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MARKET DRIVERSPOWER INTEGRATED RESOURCES PLAN: CONSULTANT

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Natural Gas Forecast

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• Reference Case Henry Hub outlook:• ST: Aligned with Jan 2018 forwards• MT: Upward pressure from exports mitigated by ample supply• LT: Gradually rising production costs

• High Case anticipates several factors:• Increased weather-related volatility• Second wave of LNG export projects • More coal and nuke retirements in mid-2020’s

• Low Case anticipates several factors:• Low LNG, pipeline exports• Rapid transition to renewable power• Production technology advances • New gas resource discoveries


Natural Gas Forecast: City Gate

45Source: Pace Global


CO2 Prices


$53.14

$26.09

$150.00

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Pace - Consensus Forecast CA Est. Floor Price Carbon High Case


Capital Costs


Combined Cycle Advanced Frame Simple Cycle CT

Source: Pace Global Source: Pace Global

The high case and low case values are derived through a +/-1 standard deviation from the mean of the stochastic distributions.

0200400600800

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Capital Costs


Wind Utility Scale Solar

Source: Pace Global Source: Pace Global

The high case and low case values are derived through a +/-1 standard deviation from the mean of the stochastic distributions.


Capital Costs- Li-ion Batteries


Li-Ion Batteries

Source: Pace GlobalNote: Base capital cost is the consensus of several sources including Lazard, CEC, etc.


PRELIMINARY FINDINGSPOWER INTEGRATED RESOURCES PLAN: CONSULTANT

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Preliminary Base Case Findings

Base Case FindingsThermal Resources operated at minimum take levels, to limit emissions

Local generation operated only for local reliability and system reliabilityAll new resources are wind or solar

Met mandated RPS and GHG targets

Intermountain Power Plant not selected as supply after 2027

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Future ConsiderationsDiversification of resource mix

How to meet reliability requirements


THE ENDPOWER INTEGRATED RESOURCES PLAN: CONSULTANT

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power integrated resource plan pwp presentation€¦ · software; used in past pasadena irps....

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