Power Integrated Resource Plan PWP Presentation · 8/23/2018 · New Utility Scale Solar Capacity...

Pasadena Water and Power

Power Integrated Resource PlanPWP Presentation

Community Meeting #2Hastings Ranch Library

August 23, 2018


Base Case Results

All Future Long Term Resource Commitments Renewable (Utility scale solar)• Reliability requirements will met through Capacity Markets

No Additional Long Term Fossil Fuel Resources• Intermountain Power Plant not selected as supply after

2027 (no participation in the gas repower option)

91% GHG Reduction (2030)63% RPS (2030)

2


PWP ACCOMPLISHMENTS & PROGRAMS

POWER INTEGRATED RESOURCES PLAN

3


Renewable and Coal % of Portfolio

4

2%

8% 8% 9%

16%

24% 24%27% 28% 29%

32%

38%

67% 65%60% 61%

54% 56%

44%

52%48%

34%

40%

31%

0%

10%

20%

30%

40%

50%

60%

70%

80% Eligible Renewable Coal


Green Power Option

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

renewable power and reduces the city’s dependence on non-renewable resources

• Options> Residential Green Power $5 per month for 200 kWh $10 per month for 400 kWh 2.5¢ for every kWh of actual monthly usage

> Commercial Green Power $25 per block of 1000 kWh 2.5¢ for every kWh of actual monthly usage

5


2018 IRP BACKGROUND & GOALS


6


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

7


2018 IRP vs. Previous IRPs

8

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

• Delivery Constraints• Review of cost effective energy storage, demand response,

energy efficiency, etc.• Balanced Scorecard

> Balancing these important issues with reliability, cost and environmental stewardship

> A more detailed scorecard has been developed with input from the Power IRP Stakeholder Technical Advisory Group

9


SCENARIOS AND SCORE CARD


10


Tentative Scenarios

• Working with the Stakeholder Technical Advisory Group (“STAG”), 5 total scenarios were selected> Base Case> Social Cost of Carbon Case> High Load Case> SB 100 Compliance Case> Diversification of Resources Case

11


IRP Scorecard Considerations

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

12


Scorecard

Item Details WeightCost/Ratepayer Impacts Combined to look at the

Customer/Ratepayer Impacts and overall costs of the portfolio, as compared to the base case costs and current PWP costs

40%

Compliance Reliability and SB 350 Compliance 35%

Environmental Stewardship

Meet or exceed state mandates 20%

Diversity Type of resource, length/contract term of resources, type of technologies, location of resources, etc.

5%

13


2018 IRP PROCESSPOWER INTEGRATED RESOURCES PLAN

14


2018 IRP – Tentative Schedule

15

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 OUTLINE SEPTEMBER 2018

IRP COMPLETE OCTOBER 2018

FINAL IRP PRESENTATION TO EAC, MSC AND CITY COUNCIL

NOV/DEC 2018


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 SURVEYPOWER INTEGRATED RESOURCES PLAN

17


Key Findings

18

• As of 8/22/18, 285 responses• Highest Priority:

> High Reliability & Affordable rates• Preferred RPS Target:

> Between 50%-75%• Customer Willing to Pay More (5-10% rate

increase) for:> Lower GHG emissions> Higher RPS> Reduced Regional health impacts

Entire Electric Bill


2018 IRP IMPACTSPOWER INTEGRATED RESOURCES PLAN

19


IPP Contract Details

20

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. The Renewal Project was NOT recommended in the base case analysis.


PPA Price vs. Delivered Cost

• Contract Price (PPA) – Includes “must take”• Delivered Price

> Transmission Costs> Time of Delivery Adjustments Congestion Losses

> Renewable Integration Charges> Resource Adequacy/Reliability Requirements

21


Energy Charge (made up of the IRP, O&M and

Other Charges)$0.1094 54.10%

Distribution and Customer Charge

$0.0604 29.87%

Transmission Charge$0.0252 , 12.46%

$-

$0.0500

$0.1000

$0.1500

$0.2000

$/kW

h

Public Benefits Charge

$.0072 , 3.56%

PWP Costs Per KWh FY 2019 (rounded)

22

$.2022Total


Other 3.3% $.0036

Estimated Energy Charge Cost Breakdown by kWh FY 19

23

The results of the IRP impact the Energy Charge portion of the PWP bill, which makes up >50% of the bill

Energy Charge$0.1094

Distribution and Customer

Charge $0.0604

Transmission Charge$0.0252

$-

$0.0500

$0.1000

$0.1500

$0.2000

$/kW

h

Public Benefits Charge$.0072

O&M and Other Costs 43.3%$.0474

IRP Related Costs56.7%$.0620 E

nerg

y C

harg

e


FOLLOW-UP TO 7/18/18 COMMUNITY MEETING


24


Community Meeting #1

• Gas Leakage> PWP is following CARB regulations on reporting

emissions. Leakage isn’t specifically included in our emissions calculations.

• Energy Efficiency (“EE”)> IRP will analyze the cost effectiveness of EE options

• Energy Storage (“ES”) Options> As part of AB 2514, PWP prepares an energy

storage analysis every 3 years. At this time, ES is not a cost effective option. But it may be included in future iterations of the IRP.

25


Community Meeting #1

• Social Cost of Carbon> This is a Scenario in the IRP

• Rooftop Solar Options> Rooftop solar costs 3-4X utility scale solar> Did not pass initial cost screening

• How to resolve delivery constraint> This will be done via the Power Delivery Master Plan,

which will kick off later this year or early next year• Diversification of resources

> One of the IRP Scenarios will be based on diversity of resources, by type, location and term

26


2018 IRP NEXT STEPSPOWER INTEGRATED RESOURCES PLAN

27


Next Steps

• Seek Community Input> Community meetings> STAG meetings occur in September> Survey

• Selecting Final Portfolio> Balanced scorecard reliability, stability, costs and environment

• Finalize IRP

28


Power Integrated Resource PlanConsultant Presentation

Community MeetingHastings Ranch Library

August 23, 2018


BACKGROUNDPOWER INTEGRATED RESOURCES PLAN

30


Steps for IRP Development

31

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


Energy Efficiency (EE)

• Working with Siemens/ASWB/AEG to develop a cost- effectiveness analysis for existing and potential EE programs

• Will highlight potential for program changes to increase cost-effectiveness of EE

• PWP EE goals were developed in 2017> Will be updated in 2021

• Will discuss doubling of EE by 2030> Details in the next IRP process (2+ years)

32


BASE CASE POWER INTEGRATED RESOURCES PLAN

33


Base Case Results

Base Case FindingsThermal resources operate at must-take take levels, to limit emissions

Local generation operates only for local reliability and system reliabilityAll new long term resources are utility scale solar

Meets RPS mandates and GHG targets by 2030

Intermountain Power Plant not selected as supply after 2027

34

Future ConsiderationsDiversification of resource mix: should PWP rely only on solar?

How best to meet future reliability requirements?


Portfolio Summary for Base Case

35

Outcome DetailsNew Utility Scale Solar Capacity

25 MW in 2023, growing to 150 MW by 2039

New Wind Capacity 0 MW (existing wind contracts expire)New Large Scale Batteries(4-hour duration) 0 MW in the study period (2019-39)

Total Cost of Portfolio over 20 years (*Nominal $) $1.53 billion

Emission Reduction by 2030 91%Reserve Margin 15% minimum requiredRPS by 2030 63%

*All costs are shown in 2019$


Base Case Generation (MWh)

36

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

201920202021202220232024202520262027202820292030203120322033203420352036203720382039

Gen

erat

ion

(MW

h)

Coal Gas CC Gas Peaker Hydro Nuclear Other RPS Solar Wind CAISO Purchases

CAISO MARKET PURCHASES & SHORT TERM RENEWABLES(MAJORITY OFF-PEAK)

COAL

SOLAR


Base Portfolios Costs ($/MWh)

37

$50.00

$55.00

$60.00

$65.00

$70.00

$75.0020

19

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

Port

folio

Cos

t ($/

MW

h)

Portfolio Costs $/MWh Nominal $ (2019) 2019 Budget $


Base Portfolio Achieves a 91% CO2 Emission reduction from 1990 level by 2039

38

483,037

74,744 72,948

-

100,000

200,000

300,000

400,000

500,000

600,000

CO

2 Em

issi

ons

(Met

ric T

ons)

47% Reduction

91% Reduction 92% Reduction


Impacts of IRP on RPS Levels

39

0%

10%

20%

30%

40%

50%

60%

70%

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

PWP RPS RPS % Requirement


Other 3.3% $.0036

Estimated Energy Charge Cost Breakdown by $/kWh FY 19

40

The results of the IRP impact the Energy Charge portion of the PWP bill



Charge $0.0604


$-

$0.0500

$0.1000

$0.1500

$0.2000

$/kW

h


O&M and OtherCosts43.3%$.0474


nerg

y C

harg

e


Other 3.3% $.0036

Projected IRP Base Case Energy Charge Cost Impact $/kWh

41

Energy Charge portion of the PWP bill increases by $.003/kWh on average



Charge $0.0604


$-

$0.0500

$0.1000

$0.1500

$0.2000

$/kW

h


O&M Costs & Other41.9%

$.04705


nerg

y C

harg

e


Estimate of Base Case Energy Charge Cost Impacts (500 kWh)

40

Details of Impact Current Energy Charge Cost

Average Energy Charge Cost Impact over 20 years (Base Case)

Energy Charge Cost ($/kWh)

$.1094 $.1124+$.003

500 kWh Bill Energy Charge

$54.70 $56.19

500 kWh Total bill $102.37 $103.86500 kWh Bill Impact $ +$1.49500 kWh Bill Impact % +1.45%*Note, this analysis is based on energy charge costs, not the actual energy charge rate. This analysis is for comparison purposes only. All other data is held constant, to only capture the impacts of the IRP analysis.


SCENARIO: SOCIAL COST OF CARBON “SCC”


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Results of Social Cost of Carbon

Items Base Case PreliminarySCC

Difference

RPS by 2030 Increases

63% 69% +6%

New Renewablecapacity by 2039

125 MW 150 MW +25 MW

GHG Emissions 2030 decrease %

91% 96% +5%

Total Portfolio Cost Increases over 20 years

$1.53 billion $1.56 billion +$32 million, +2%

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*Note, this analysis is an estimate only. This analysis is for comparison purposes only.


THE ENDPOWER INTEGRATED RESOURCES PLAN

45

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