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NorthWestern Energy Assessment of Renewable Energy Resources using the Western Renewable Energy Zones (WREZ) Model January 2011 Page - 1
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NorthWestern EnergyAssessment of Renewable Energy Resources using the
Western Renewable Energy Zones (WREZ) Model
January 2011
Page - 1
How to use this Presentation
This presentation is designed to provide a succinct review of results while allowing users to access more guidance if necessary
Navigation (must be in full-screen mode)
Hyperlink – Link to additional information resources
– Click to get more information on assumptions and methodology for a specific slide (if available)
– Click to return to the last viewed slidePage - 2
Guide
Guide
Run the presentation in slide-show mode (Press F5) to use navigation buttons
Organization of Material in this Presentation
1. Introduction
2. Renewable Energy Demand
3. Identification of Most Economic WREZ Resources
4. Comparison to Local Resources
5. Maps of Top WREZ Resource Areas for NorthWestern Energy
6. Slide by Slide Guide
Page - 3
Guide
IntroductionIntroduction
Page - 4
Overview of WREZ Initiative The WREZ initiative has identified “hubs” composed of environmentally preferred, high
quality renewable resources sufficient to justify building new high-voltage transmission in the Western Interconnection
WREZ resource data was developed by the Zone Identification and Technology Assessment (ZITA) workgroup. A discussion of the resources and zone identification process may be found at: www.nrel.gov/docs/fy10osti/46877.pdf (8 MB)
A Generation and Transmission Model (GTM) was developed
Transparent and user-friendly model for load-serving entities (LSEs), regulators and others to evaluate the delivered cost of energy coming from renewable energy hubs
Focus is on renewable resources that may be more distant from loads, but local resources can be added by users for comparison
Available at:http://www.westgov.org/index.php?option=com_content&view=article&catid=102%3Ainitiatives&id=220%3Awrez-transmission-model-page&Itemid=81
Both ZITA and GTM were stakeholder-led processes with consensus from western utilities and industry stakeholders
Page - 5
Guide
WREZ and the Generation and Transmission Model Can Assist with Key Questions
Which resources might be economically attractive for meeting renewable portfolio standard (RPS) targets in the West?
What new transmission is needed to access those resources?
Which LSEs may be potential partners for coordinated procurement and transmission?
How do local options compare to more distant resources?
Page - 6
Purpose of this presentation is to address these key questions for NorthWestern Energy using “base case” (default) assumptions for the
GTM.
Guide
Important Considerations
The WREZ GTM was run with a common set of assumptions across all the Western Interconnection
For example, all incremental transmission, 50 percent line utilization
The model is available to download and customize as users would like
The results provide a consistent basis to compare utilities, but they are likely different from the utilities’ current resource priorities.
Focus is on potential resources. No evaluation of existing resources.
The model was run independently for 25 utilities. The same potential resources were modeled for all utilities. Multiple utilities could identify the same resource as being economic for their portfolio. Utilities may compete or collaborate for these better resources. This slide indicates resource overlap.
Projections were made to 2030 with high RPS targets. This is to encourage long range thinking.
The intent is for this information to stimulate conversation about long range resource planning
Page - 7
Guide
Renewable Energy DemandRenewable Energy Demand
Page - 8
Modeled Renewable Energy Demand (GWh/yr)
Page - 9
Notes –Load forecast values obtained from survey performed by LBNL.
Guide
RenewableDemand Scenario
Load in Goal Year
Gross Renewables
Demand
Existing Resources*
Net Renewables
Demand
15% by 2015 6,205 931 Not included 931
33% by 2030 6,840 2,280 Not included 2,280
*Generation from existing plants and plants currently under construction. Not included at this time.
Identification of Most Economic WREZ Resources
Identification of Most Economic WREZ Resources
Page - 10
Page - 11
Busbar Cost
Transmission Cost
Integration Cost
+
+
Energy Value
Capacity Value
-
-
Adjusted Delivered Cost
GTM Resource Cost DeterminationAdjusted Delivered Cost of Energy Resource cost information provided by
model:
Busbar cost: “raw” cost of generation
Delivered cost: cost to transmit energy to load zone
Adjusted delivered cost: the value of a resource to a load zone, taking into consideration the energy and capacity benefit delivered by the resource
Additional information on specific approach and assumptions in accompanying guide slides
GuideD
elivered Cost
WREZ Resources
Page - 12
Guide
The Zone Identification and Technical Analysis (ZITA) workgroup identified potential renewable resource hubs
Hubs are meant to represent the highest quality resources in the Western Interconnect
The size of the hub is proportional to its energy potential (GWh/yr)
Each hub can have multiple resources depending on what is available
Hub names provide the following information on state and relative location in the state. Examples:
NV_WE: Nevada West
BC_WC: British Columbia West Central
NM_EA: New Mexico East
AB_EA
AB_EC
AB_NO
AB_SE
AZ_NE
AZ_NW
AZ_SO
AZ_WE
BC_CT
BC_EA
BC_NE
BC_NO
BC_NW
BC_SE
BC_SO
BC_SW
BC_WC
BC_WE
BJ_NO
BJ_SO
CA_CT
CA_EA
CA_NE
CA_SO
CA_WE
CO_EA
CO_NE
CO_SECO_SO
ID_EA
ID_SW
MT_CT
MT_NEMT_NW
NM_CT NM_EA
NM_SENM_SONM_SW
NV_EA
NV_NO
NV_SW
NV_WE
OR_NE
OR_SO
OR_WE
TX
UT_WE
WA_SO
WY_EAWY_EC
WY_NO
WY_SO
MT_CTMT_CT
Most Economic WREZResources
Page - 13
Resource Key
HydroWindBiomass Solar PVSolar ThermalGeothermal
HydroWindBiomass Solar PVSolar ThermalGeothermal
HydroWindBiomass Solar PVSolar ThermalGeothermal
HydroWindBiomass Solar PVSolar ThermalGeothermal
Note: Color represents the dominant resource in the Hub.
The GTM model was run with “base case” assumptions to identify the most economic resources to meet NorthWestern Energy’s renewable demand
These are shown as the colored circles at right (“Hubs”)
Additional detail provided in the following slides
Guide
0 10 20 30 40 50 60 70 80 90 100
2015
RPS
Goa
l
33%
by
2030
0
20
40
60
80
100
Adju
sted
Del
iver
ed C
ost o
f Ene
rgy,
$/M
Wh
Cumulative Annual Generation Potential, TWh
Geothermal
Solar
Wind
Biomass
Hydro
0 500 1000 1500 17500
100
200
300
Supply Curves of All WREZ Resources and Top 100 TWh of Resources*
Page - 14
Guide
Page - 14
All WREZ in WECC
Most economic resources, detailed on next slide * Supply curves do not include local, non-WREZ resources
Most Economic Resources Identified to Meet Renewables Demand: Individual Resources, Sorted by Cost
Guide
Page - 15
Note: Under cumulative, the generation column (GWh/yr) is the running total of the resources identified as most economic; the next column shows the corresponding percentage of 2030 load.
Rank Type LocationCapacity,
MWResource, GWh/yr GWh/yr
% of 2030 load
Busbar Cost
Tx Cost with
LossesIntegra-tion Cost
Energy Value
Capacity Value Total
1 Wind Class 7 Montana Central 151.9 0.6 1 <1% $61 $4 $5 ($56) ($10) $42 Wind Class 6 Montana Central 843.4 3,102.9 3,103 45% $67 $4 $5 ($56) ($10) $9
Generation Adjusted Delivered Cost of Energy $/MWhCumulative*
Most Economic Resources Identified to Meet Renewables Demand: Summary by Area, Sorted by Cost
Page - 16
Click here for Maps of Each Area
*This column shows the Adjusted Delivered Cost of Energy weighted by the energy share of each resource in the resource area (e.g. share of wind Class 7 in California West). Only resources identified as most economic are included in the calculation.
Guide
Area Biomass Solar Geothermal HydroWind
Class 3Wind Class
4Wind Class
5+Total Capacity,
MW
Total Generation,
GWh/yr
Energy Weighted Adjusted
Cost ($/MWh)*
Montana Central 995 995 3103 9
Capacity by Resource Type, MW
Resource Area PG
&E
SM
UD
LA
DW
P
SC
E
SD
GE
IID
AP
S
SR
P
TE
P
NV
En
erg
y
PN
M
El
Pas
o
Tri
-Sta
te G
&T
CS
U
Xce
l (C
O)
Pac
ific
orp
(U
T)
Pac
ific
orp
(O
R)
Pac
ific
orp
(W
A)
PG
E
EW
EB
Avi
sta
PS
E
SC
L
Tac
om
a
Idah
o P
ow
er
BC
Hyd
ro
No
rth
wes
tern
Utilities That May be Interested in Similar Resource AreasGreater Potential Interest Indicated by Filled Circles
GuidePercentage of Hub Energy Identified as “Most Economic” for a Given Utility
>90%
66.7 - 90%
33.3 - 66.7%
10 - 33.3%
>0% - <10%
Arizona Northeast
Arizona Northwest
Arizona South
Arizona West
California Central
California East
California Northeast
California South
California West
Colorado East
Colorado Northeast
Colorado Southeast
Colorado South
Idaho East
Idaho Southwest
Montana Central
Montana Northeast
Montana Northwest
New Mexico Central
New Mexico East
New Mexico Southeast
New Mexico South
New Mexico Southwest
Nevada East
Nevada North
Nevada Southwest
Nevada West
Utilities That May be Interested in Similar Resource AreasGreater Potential Interest Indicated by Filled Circles (cont.)
Guide
Resource Area PG
&E
SM
UD
LA
DW
P
SC
E
SD
GE
IID
AP
S
SR
P
TE
P
NV
En
erg
y
PN
M
El
Pas
o
Tri
-Sta
te G
&T
CS
U
Xce
l (C
O)
Pac
ific
orp
(U
T)
Pac
ific
orp
(O
R)
Pac
ific
orp
(W
A)
PG
E
EW
EB
Avi
sta
PS
E
SC
L
Tac
om
a
Idah
o P
ow
er
BC
Hyd
ro
No
rth
wes
tern
Percentage of Hub Energy Identified as “Most Economic” for a Given Utility
>90%
66.7 - 90%
33.3 - 66.7%
10 - 33.3%
<10%
Page - 18
Oregon Northeast
Oregon South
Oregon West
Texas
Utah West
Washington South
Wyoming East
Wyoming East Central
Wyoming North
Wyoming South
Alberta East
Alberta East Central
Alberta North
Alberta Southeast
British Columbia Central
British Columbia East
British Columbia Northeast
British Columbia North
British Columbia Northwest
Birtish Columbia Southeast
Birtish Columbia South
British Columbia Southwest
British Columbia West Central
British Columbia West
Baja North
Baja South
>90%
66.7 - 90%
33.3 - 66.7%
10 - 33.3%
>0% - <10%
Annual Average Hourly Profiles in WREZ With Most Generation From That Resource
Page - 19
Guide
Montana Central Wind 43% Avg
Energy Price $55/MWh Avg
$-
$10
$20
$30
$40
$50
$60
$70
$80
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
En
erg
y P
ric
e ($
/MW
h)
Ca
pa
cit
y F
ac
tor (
%)
Hour Beginning
Comparison to Local ResourcesComparison to Local Resources
Page - 20
Potential Resources in NorthWestern EnergyService Territory
Transmission LinesExist-
ingFounda-
tionalPoten-
tialSize (kV)
230-499
500
DC
Page - 21
LSE Service Areas
Guide
Legend Symbols not to Scale
Potential Wind and Solar PV Resources in NorthWestern Energy Territory
Page - 22
Guide
See guide for important notes and assumptions
Local Wind and Solar PV Resources Potential Capacity (MW)
WindClass 3 11,635Class 4 4,326Class 5+ 1,450
Solar PV1% of service territory 30,616
Generic Comparative Local Resource
Busbar Cost
Tx Cost Int. CostEnergy Value
Capacity Value
Total Without Tx Cost
Solar PV $158 Varies $2.5 ($60) ($37) $64Wind Class 3 $88 Varies $5.0 ($56) ($10) $26Wind Class 4 $78 Varies $5.0 ($56) ($10) $17Wind Class 5 $72 Varies $5.0 ($56) ($10) $11Wind Class 6 $67 Varies $5.0 ($56) ($10) $5Wind Class 7 $61 Varies $5.0 ($56) ($10) ($0)
Adjusted Delivered Cost of Energy, $/MWh
0 10 20 30 40 50 60 70 80 90 100
2015
RPS
Goa
l
33%
by
2030
0
20
40
60
80
100
Adju
sted
Del
iver
ed C
ost o
f Ene
rgy,
$/M
Wh
Cumulative Annual Generation Potential, TWh
Geothermal
Solar
Wind
Biomass
Hydro
Economic Analysis of Local Resources in Service Territory
Page - 23
Guide
WREZ Resources (Previous Supply Curve)Economics of Local Resources
Maps of Top WREZ Resource Areas for NorthWestern Energy
Maps of Top WREZ Resource Areas for NorthWestern Energy
Page - 24
Montana Central Potential Resources
0 50 100 150 200MILES
Northwestern
Northwestern
Northwestern
Northwestern
Guide
Transmission LinesExist-
ingFounda-
tionalPoten-
tial
230-499
500
DC
Size (kV)
LSE Service Areas
Slide-by-Slide Guide
Page - 26
Guide: Renewables Demand
Renewables demand is generally determined for two scenarios
RPS goals in 2020
33% renewables in 2030*
The gross renewables demand is calculated by the renewable percentage times the relevant load forecast (based on public information)
If existing and under-construction renewables are quantified, these are subtracted from the gross demand to determine the net renewables demand
Net renewables demand is used as a “mile-marker” to indicate the rough renewables needed for the utility
The 33% by 2030 scenario is used as the basis for the analysis in the presentation (tables, charts, etc.)
Page - 27
Guide
This slide shows a table which roughly indicates how much renewable energy the utility might be interested in under future scenarios.
*For California utilities, 2030 total demand is shown
Guide: GTM Resource Cost Determination
Busbar Cost – levelized cost of energy considering capital cost, O&M, fuel costs, heat rate (biomass), incentives, net plant output, gen-tie costs, capacity factor, economic life, discount rate, inflation, and financing costs.
Detailed ZITA resource assumptions: www.nrel.gov/docs/fy10osti/46877.pdf (8MB)
Transmission Cost – levelized cost of delivering the energy from the resource to load area including losses. For the purposes of this model, all resources are assumed to require new transmission, costs for which are estimated based on a 500 kV single-circuit ac line operating at 50% utilization
Integration Cost – Indirect operation cost to the transmission system to accommodate the generation from the project into the grid. Starting point assumptions are provided in the model, but a user can change the integration cost for each technology.
Wind - $5/MWh, solar thermal - $2.50/MWh, solar photovoltaic - $2.50/MWh, all others - $0/MWh
Energy Value – represents the value of a resource’s hourly output to the load zone – i.e. the load zone’s marginal cost. Energy values were developed by Black & Veatch based on 2015 market forecast ($2009) using the ProMod production cost model.
Capacity Value – capacity value represents the fractional avoided carrying costs of simple cycle combustion turbine. A capacity credit fraction is calculated for each project based on its operation during peak periods (top 10% of load hours).
Page - 28
Guide
Click here for full description of methodology and assumptions: http://www.westgov.org/wga/initiatives/wrez/gtm/documents/GTM%20V%202.0%20Method%20Assumptions.pdf
AB_EA
AB_EC
AB_NO
AB_SE
AZ_NE
AZ_NW
AZ_SO
AZ_WE
BC_CT
BC_EA
BC_NE
BC_NO
BC_NW
BC_SE
BC_SO
BC_SW
BC_WC
BC_WE
BJ_NO
BJ_SO
CA_CT
CA_EA
CA_NE
CA_SO
CA_WE
CO_EA
CO_NE
CO_SECO_SO
ID_EA
ID_SW
MT_CT
MT_NEMT_NW
NM_CT NM_EA
NM_SENM_SONM_SW
NV_EA
NV_NO
NV_SW
NV_WE
OR_NE
OR_SO
OR_WE
TX
UT_WE
WA_SO
WY_EAWY_EC
WY_NO
WY_SO
Guide: WREZ Resources
Page - 29
Guide
Environmental exclusions
Example resource
Transmission
Resource Hub
Guide: Supply Curve of WREZ Resources
Page - 30
Guide
This slide shows all of the WREZ resources in the Western Interconnection (upper right hand corner), sorted from lowest to highest adjusted delivered cost. The top 100 TWh of resources are shown in the large supply curve. Two demand lines are shown on this chart (dashed red lines). One for a 2020 RPS target (if applicable), and a second representing 33% of 2030 load (total load for California utilities). The resources to the left of the lines represent the most economic resources for that scenario.
Guide: Most Economic Resource Tables
Page - 31
Guide
This slide lists all of the individual WREZ resources identified as most economic to meet a 33 percent renewable energy target. Each resource represents a “step” in the supply curve shown on the previous page. The resources are listed in ascending order from lowest to highest cost. Generation is tracked on a cumulative basis so that the renewable penetration running total can be tracked.
This slide summarizes the information in the previous table by technology and by resource area. The resources are listed in ascending order from lowest to highest cost.
Page - 32
Guide
Guide: Utility Comparison Matrix
Resource Area PG
&E
SM
UD
LA
DW
P
SC
E
SD
GE
IID
AP
S
SR
P
TE
P
NV
En
erg
y
PN
M
El
Pas
o
Tri
-Sta
te G
&T
CS
U
Xce
l (C
O)
Pac
ific
orp
(U
T)
Pac
ific
orp
(O
R)
Pac
ific
orp
(W
A)
PG
E
EW
EB
Avi
sta
PS
E
SC
L
Tac
om
a
Idah
o P
ow
er
BC
Hyd
ro
No
rth
wes
tern
Arizona Northeast
Arizona Northwest
Arizona South
Arizona West
California Central
California East
California Northeast
California South
California West
Colorado East
Colorado Northeast
Colorado Southeast
Colorado South
Idaho East
Idaho Southwest
Montana Central
Montana Northeast
Montana Northwest
New Mexico Central
New Mexico East
New Mexico Southeast
New Mexico South
New Mexico Southwest
Nevada East
Nevada North
Nevada Southwest
Nevada West
Percentage of Hub Energy Identified as “Most Economic” for a Given Utility
>90%
66.7 - 90%
33.3 - 66.7%
10 - 33.3%
<10%
While other utilities may be interested in this zone, it is most economic for APS
All California utilities may be interested in this zone, including some with significant interest. This indicates potential for competition and/or collaboration
This zone is common to APS and SRP. A shared transmission solution may be economic
This slide compares the most economic resource areas for all utilities. The symbols represent the potential “interest”* level of a utility in an area. This is measured by the percentage of the resource area’s total resources that are identified as economic for a utility. Greater potential interest is indicated by filled circles. For example, 9,700 GWh of California West resources are identified as being economic resources to meet PG&E renewable targets. The total potential resources in California West are 59,000 GWh/yr, meaning PG&E’s interest is 16%. Per the key, the quarter-filled circle is displayed.
This slide allows a quick comparison of potential transmission collaboration or resource competition. Some examples are shown below.
*For the purposes of this discussion, “interest” means that the resource has been identified bythe model as being potentially economic. It does not imply actual interest by the utility.
Guide: Annual Average Hourly Profiles
Page - 33
Guide
California West Wind 36% Avg
Oregon West Geothermal
90% Avg
Energy Price $71/MWh Avg
0
10
20
30
40
50
60
70
80
90
100
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
En
erg
y P
ric
e ($
/MW
h)
Ca
pa
cit
y F
ac
tor (
%)
Hour Beginning
This slide shows the output profiles of the largest WREZs (by generation) identified as economic for the 33% by 2030 scenario. The profiles are compared to the energy price profile for the utility. Average annual diurnal profiles are provided for price and capacity factor.
The purpose of this chart is to be able to compare the relative “fit” between the output of the resources and the need (as expressed by energy value) of the utility. In the example below, the flash-based geothermal project provides a baseload resource available 24 hours a day. The wind resource is more variable, but still peaks near when energy prices are highest. It is important to note that there are seasonal variations in these data as well, not shown below. The GTM model considers a 12 month by 24 hour profile when making energy and capacity value calculations (more detailed GTM methodology and assumptions provided here).
Guide: Utility Service Area Map Showing Local ResourcesMaps are provided for the utility service area to show local and nearby WREZ renewable resources (if any). The maps show the renewable resources in relation to other features, including land exclusions, other utility service areas, and transmission lines. Key features of the maps are identified below.
Page - 34
Resource legend
Transmission line types
Wind resources
Geothermal resource
Solar resources
Hydro resources
Exclusions: lands removed from consideration for development due to environmental restrictions (e.g., wilderness area), or other land use constraints (urban areas)
Potential transmission line
Existing transmission line
Guide
Guide: Potential Local Resources
General Assumptions
The estimates represent total potential and do not account for existing resources that have already been developed.
Estimates do not consider constraints on the transmission or distribution system.
Local resources were quantified in a manner consistent with the evaluation of larger WREZ resources:
Wind: quantified Class 3 and higher wind on land that has not been excluded for environmental or other land use reasons. Only included land outside of WREZ hubs. Assumed 25% of the resulting land could be developed. Assumed 5 MW/km2 development density.
Solar: Estimate is just a rough indication of potential based on the geographic size of the utility service territory. Quantified total area of utility service territory. Assumed 1% of this land could be developed. Assumed 38 MW/km2 development density. Unlike wind, did not account for environmental exclusions or larger WREZ resources.
Page - 35
Guide
This slide quantifies potential local resources (solar PV and wind), based on a high-level GIS analysis. Utilities may supplement this with their own knowledge about other resources, including biomass, hydro and geothermal. The intent is to show how local resources might complement or compete with more distant resources.
Guide: Local Resource Economics
General Assumptions
Costs are based on utility-scale local resources (>20 MW) and consider generic performance typical for the service territory.
Wind assumptions:
$2,200/kW capital cost
Capacity factor is based on the wind class, as quantified on the previous slide.
Class 3 (32%), class 4 (36%), class 5 (39%), class 6 (42%), class 7 (46%).
Solar PV assumptions:
Thin film, fixed tilt technology
$3800/kW capital cost (ac basis)
capacity factor determined based on location
Page - 36
Guide
This slide compares the economics of potential local solar and wind resources (table on left) to the WREZ resources previously identified (supply curve on right). The intent is to show how local resources might complement or compete with more distant resources. Quantities of local resources are not definitive, so this chart just indicates where the relative cost of local resources lies compared to distant resources. An important caveat is that the local resources do not include the cost of transmission and distribution upgrades, which are unknown. As such, the economics shown here should be considered a best case scenario for local resources.
Guide: WREZ Resource MapsMaps are provided for each WREZ resource area identified as having high economic potential. The maps show the renewable resources in relation to other features, including land exclusions, utility service areas, and transmission lines. Key features of the maps are identified below.
Page - 37
Mini-map showing selected hub and surrounding areas
Resource legend
Transmission line types
For California areas, any overlapping Competitive Renewable Energy Zones (CREZs) from the Renewable Energy Transmission Initiative are identified (map).
Wind resources
Geothermal resources
Solar resources
WREZ area of interest
Exclusions: lands removed from consideration for development due to environmental restrictions (e.g., wilderness area), or other land use constraints (urban areas)
Example foundational transmission line
Guide
Guide: Transmission Line Types
Existing: Operating lines 230 kV and higher
Foundational: transmission projects that have a very high probability of being in service in a 10-year timeframe and are an assumed input into WECC’s 2011 10-year transmission plan
Potential: transmission projects that have been identified in WECC Subregional Planning Group 10-year plans but do not meet the foundational transmission project criteria
Page - 38
Existing Foundational Potential
230-499
500
DC
Size (kV)
Guide
