UMPA’S FUTURE POWER SUPPLY WHAT’S NEXT?

PREPARED BY: KEVIN GARLICK

APRIL 21, 2017

1

WHAT ARE UMPA’S NEEDS? LOAD FORECAST

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38

KW

Fiscal Years

UMPA'S PROJECTED PEAK LOAD

FY18 FY19 FY20-FY27 FY28-FY37

LEVAN Capacity 100.2% 100.5% 100.5% 100.5%

MANTI Capacity 100.8% 100.9% 101.0% 101.0%

NEPHI Capacity 101.3% 101.6% 101.8% 101.8%

PROVO Capacity 100.27% 100.4% 100.4% 100.4%

SALEM Capacity 101.5% 101.8% 101.9% 101.9%

SP. FORK Capacity 102.3% 102.5% 102.7% 102.7%

LOAD GROWTH TABLE

2

WHAT ARE UMPA’S EXISTING POWER RESOURCES?

• COLORADO RIVER STORAGE PROJECT (FEDERAL POWER) CONTRACT – HYDRO (RENEWABLE)

• HUNTER UNIT 1 OWNERSHIP – COAL FIRED

• BONANZA OWNERSHIP – COAL FIRED

• PACIFICORP CONTRACT – MIX RESOURCE

• DESERET CONTRACT – BONANZA AND HUNTER UNIT 2 – COAL FIRED

• MEMBER-OWNED HYDROELECTRIC POWER PLANTS – 6 UNITS (RENEWABLE)

• WINDWARD CONTRACT – WIND (RENEWABLE)

• WEST VALLEY POWER PLANT – NATURAL GAS

3

WHAT IS PLANNED? UPCOMING POWER SUPPLIES

• SIX-MILE HYDROELECTRIC PROJECT CONTRACT – HYDRO (RENEWABLE)

• PROVO POWER PLANT OWNERSHIP - NATURAL GAS

• BYU COGENERATION CONTRACT – NATURAL GAS (RENEWABLE)

• OLMSTED HYDROELECTRIC PROJECT (FEDERAL POWER) CONTRACT – HYDRO (RENEWABLE)

• SOLAR – DISTRIBUTIVE GENERATION (RENEWABLE)

• ROOF TOP SOLAR – RESIDENTIAL

• COMMERCIAL PROJECTS OVER 25 KW – FEED-IN TARIFF

• SUBSCRIBER SOLAR PROGRAM (COMMUNITY SOLAR)

4

SIX-MILE HYDRO POWER PLANT

• SMALL HYDRO – 1.3 MW & 4,439 MWH/YR AVERAGE

• RATE – $37/MWH WITH 2% ESCALATION/YR

• 3 YEAR CONTRACT (OPTION TO RENEW)

• START: MAY 2017

5

PROVO POWER PLANT

• PURPOSE FOR THIS FACILITY

• PEAKING POWER

• STAND-BY RESERVES

• LOWER TRANSMISSION COSTS

(MONTHLY PEAK TRANSMISSION COSTS ARE HIGHER THAN A FEW HOURS OF GENERATION)

• REMOTE OPERATION

• MINIMUM MAINTENANCE STAFF

• CLEANEST ENGINE FACILITY IN THE STATE

6

BYU COGENERATION PLANT

• COMBINED HEAT AND POWER FACILITY

• RENEWABLE

• NEGOTIATING THE DEAL

• BYU - GETS THE HEAT

• UMPA - BUYS THE POWER

• PROVO - SELLS RETAIL ELECTRIC SERVICES TO BYU

• INTERCONNECTION AGREEMENT

• ENGINEERING STUDY (SALIENT ENGINEERING)

• POWER PURCHASE AGREEMENT

• RATE STUDY (SAWVEL & ASSOCIATES)

7

OLMSTED HYDROELECTRIC POWER PLANT

• HISTORICAL HYDRO SITE – 1900

• EARLY OWNER – UTAH POWER & LIGHT

• REBUILDING THE POWER PLANT

• CENTRAL UTAH WATER CONSERVANCY DISTRICT

• DEPT. OF INTERIOR

• MARKETING THE FEDERAL POWER

• WESTERN AREA POWER ADMINISTRATION

• MARKETING PLAN

• 13 MW & 25,000 MWH/YEARLY

• INTERCONNECTION TO PROVO POWER

• UMPA REQUESTING AN ALLOCATION

• PRICING SIMILAR TO DEER CREEK - $25-$35/MWH

8

NET METERING – ROOF TOP

UMPA-MEMBER CITIES ENCOURAGE SOLAR THROUGH NET METERING PROGRAMS

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As of Feb 17 Customers 0 4 6 321 21 98 450

Installed Capacity (kW) 38.00 48.86 1,971.14 150.57 583.13 2,791.70

Estimate Production (kWh) 53,261 68,482 2,762,754 211,039 817,315 3,912,851

System Energy 4,994,456 21,296,679 99,884,683 800,443,152 36,969,752 261,619,024 1,225,207,746

Percentage of System 0.25% 0.07% 0.35% 0.57% 0.31% 0.32%

Fiscal Year Levan Manti Nephi Provo Salem Spanish Fork UMPA

-

1,000

2,000

3,000

4,000

5,000

6,000

2013 2014 2015 2016 2017

MW

H

Solar Growth - UMPA Members

SOLAR – MORE PLEASE!

COMMERCIAL – 25 KW +

FEED-IN TARIFF

• BUY ALL/ SELL ALL PROGRAM

• UMPA BUYS ALL AT AVOIDED COST RATE

• MEMBER CITY SELLS ALL AT RETAIL RATES

• CUSTOMER NETS THE BENEFIT

• NEW TOOL IN THE TOOL BOX

• EACH MEMBER CITY TO APPROVE

SUBSCRIBER SOLAR PROGRAM

OR COMMUNITY SOLAR

• MEMBER CITY TO OPT INTO PROGRAM

• MARKETING TO CUSTOMERS

• ALTERNATIVE TO ROOFTOP SOLAR

• FIXED POWER COSTS PLUS WHEELING

• NEW RATE FOR UTILITY BILLING

• ANOTHER TOOL IN THE BOX

• FINDING THE RIGHT SITE

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FUTURE RESOURCE GAP THE NEXT TARGET

FY - 2020

• DESERET CONTRACT EXPIRES

• 80 MW

• DECEMBER 2019

• BASE LOAD RESOURCE

• COAL FIRED

FY - 2025

• BONANZA OWNERSHIP–LIKE EXPIRES

• 3.12 % OF THE PLANT OR 14 MW

• MARCH 2025

• BASE LOAD RESOURCE

• COAL FIRED

11

OPTIONS TO FILL THE FUTURE GAP

• EXTEND DESERET POWER PURCHASE AGREEMENT - COAL FIRED

• BUY NUCLEAR POWER – CARBON FREE

• UAMPS’ SMALL MODULAR REACTORS PLANT IN IDAHO – IDAHO NATIONAL LAB SITE – 2026?

• BLUE CASTLE SITE – WESTINGHOUSE AP1000 DESIGN – GREEN RIVER SITE – 2028?

• COMBINE CYCLE NATURAL GAS POWER PLANT – 2021? (NDA WITH DEVELOPER)

• MARKET PRICED 5-YEAR POWER PURCHASE AGREEMENT – SOURCE NOT DEFINED

• UTILITY SOLAR FARM DEVELOPMENT

• NEW TECHNOLOGY

• NEW OPPORTUNITIES

12

UTILITY SOLAR OPTIONS

• EXAMINING MULTIPLE DEVELOPERS – NDA

• MEETS STATE’S GOAL FOR RENEWABLE

• COMPETITIVE PRICES - $35 TO $50/MWH (NO TRANSMISSION COSTS)

• TRANSMISSION CHALLENGES

• TIMING – REDUCTION OF TAX INCENTIVES

• DUCK CURVE IMPACTS – SUPPLEMENTAL CAPACITY

• DECISION FOR 2020 BY THIS FALL

13

20% BY 2025 - UTAH RENEWABLE GOAL ESTIMATED 270,000 MWH FOR UMPA

COAL REDUCTION

• 2017 PACIFICORP CONTRACT -75 MW

• 2020 DESERET CONTRACT – 80 MW

• 2025 BONANZA OWNERSHIP-LIKE – 16 MW

• 2030 BONANZA OWNERSHIP – 17 MW

• 2042 HUNTER UNIT 1 – 27 MW

RENEWABLE GROWTH

• NET METERING

• FEED-IN TARIFF

• COMMUNITY SOLAR

• 6-MILE HYDROELECTRIC PLANT

• BYU COGENERATION PLANT

• OLMSTED HYDROELECTRIC PLANT

• UTILITY GRADE SOLAR

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EXISTING RENEWABLES: 28.7% 2016

• CRSP – FEDERAL POWER

• DEER CREEK DAM – FEDERAL POWER

• MEMBER HYDRO POWER PLANTS

• WINDWARD CONTRACT - WIND

Prediction

UMPA will be over 40% renewable by 2025

WHAT SHOULD UMPA DO WITH POWER SUPPLY?

• UPDATING UMPA’S INTEGRATED RESOURCE PLAN (IRP) – FEDERAL POWER REQUIREMENT

• EXAMINATION OF MANY VARIABLES

• COSTS/RATES/FINANCING

• RESOURCE TYPE – BASE, INTERMEDIATE AND PEAKING

• RENEWABLE GOALS

• LOCAL, STATE & FEDERAL DIRECTION - ENVIRONMENTAL AND REGULATORY POLICIES

• GRID STABILITY & CUSTOMER RELIABILITY

• ENERGY EFFICIENCY, NEW TECHNOLOGY & DISTRIBUTED GENERATION

• 5 TO 20 YEAR LOOK INTO THE FUTURE OF POWER SUPPLY

• FEEDBACK FROM OUR MEMBER CITIES

• PUBLIC PROCESS – REVIEW AND COMMENT PERIOD

• ADOPTED BY THE UMPA BOARD

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QUESTIONS? THANK YOU

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