PacifiCorp 20022003 IRP Presentation Oregon Public Utility by dfhdhdhdhjr

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									Overview
»History of IRP
                           Power Supply Adequacy Forum
»PacifiCorp’s Position
»Key IRP Assumptions     Roundtable Discussion on IRP
»Reviewing Assumptions
»Studies & Issues




                                   May 2003
History of PacifiCorp’s IRP
History of IRP:
                                   Dec. ‘01              Mar. ‘02               Jun. ‘02           Sep. ‘02
»   Used Henwood                      to                   to                     to                  to
    models (ProSym and            Feb. ‘02              May ‘02                Aug. ‘02           Jan. ‘03
    MarketSym) to
    perform analysis
»   Risk was introduced
    as an important
    factor in this IRP
    process
                            Began public input                           Held technical    Produced final set
                                                  Evaluated risk
»   Required to file an     meetings              models                  workshops          of IRP Results
    IRP every two years     Selected IRP model Consolidated             Finalized risk    Developed Action
»   Ten Public Input                                                      model              Plan
                            Gathered and input models and verified
    Meetings were held      model data and      preliminary results       Ran portfolios    Prepared IRP Draft
    between December        assumptions                                   through models     Report
                                                Updated inputs and
    2001 and February                             assumptions             Processed data    Communicated IRP
    2003                                          Selected initial new   and produced       findings and issued
                                                                          preliminary        Draft Report
»   Eleven Public                                 resources for
                                                                          results
    Technical Workshops                           portfolios                                 Modified Draft
                                                  Completed initial      Refined           Report based on
    were held with
                                                                          portfolios based   public input
    participants                                  model runs
                                                                          on findings, ran
                                                                                             Filed IRP with all
»   The IRP was filed in                                                  new portfolios
                                                                                             State Public Service
    all states on January                                                                    Commissions
    24, 2003                                                                                           2
Analysis of Current Position
Results of Analysis:        » PacifiCorp’s current position reveals a substantial need for new
»   Both deterministic        resources
    and stochastic
    analysis were
                            » Anticipate need of about 4,000 additional megawatts of
    performed on top          capacity over the next 10 years
    portfolios
                            » The 15% Planning Margin accounted for ~1,700 MW of the
»   Thirteen stress tests
    were also performed
                              4,000 MW in the least-cost, low risk portfolio
    on top portfolios
                                 12,000
»   Least-Cost Portfolio                   Peak System Requirement + 15% Planning Margin

    included:
                                 10,000                                              Resource Deficit - "The Gap"
     •   1,400 MW
         Renewables
                                   8,000
     •   1,200 MW
                                MW's




         Peakers
                                   6,000
     •   2,100 MW Base
         Load                                            Nameplate Capacity of Existing Resources
                                   4,000
     •   450 MWa DSM
     •   700 MW Shaped             2,000
         Products
                                       0
                                       2004    2005   2006    2007   2008    2009   2010    2011    2012    2013    2014
                                                                        Calendar Year
                                                                                                                           3
IRP Planning Margin Assumption
Base Case Assumptions:
»   Average hydro
                            » Decision Criteria used in filed IRP
»   Average loads                 • Limit initial net short energy position to less than 5% of the
                                      hours in any year
»   No Capacity credit
    for wind                      • Build portfolios to meet 15% capacity planning margin for the
»   Market sales and                  system by fiscal year 2007
    purchases were                       Planning Margin = {Load +(LT Sales - LT Purchases)} x 0.15
    limited to 500 MW for
    each control area                    This is mid-way between 12%-18% mentioned in SMD*
                                          discussions
                                         Reserve peakers were built to cover planning margin

                            » Issues with Decision Criteria
                                  • 5% criteria seemed arbitrary to third parties
                                  • FERC's SMD White Paper issued on April 28, 2003 specifically
                                      said it would not require a minimum level of resource adequacy
                                         FERC indicated that resource adequacy will be left up to the states
                                          and/or regions


                                                                                                      4
                            *Note:FERC’s Standard Market Design - Notice of Proposed Rulemaking
    Review of Planning Margin Assumption
Planning Margin Analysis:
                              » PacifiCorp’s view is planning margin needs to reflect the
»   Planning margin was
                                operating requirements
    used to provide
    sufficient resources to      • Operating Reserves (vary by control area)
    cover unplanned                     Obligated by WECC to carry operating reserves above firm
    outages, provide                     load at any time plus additional as seemed appropriate by
    operating reserves,                  operators
    regulatory margin,
    and demand growth
                                        One measure of operating reserves is 5% of hydro and 7%
    uncertainty                          of thermal generation being used to serve load at that time
                                  • Generator Unplanned Outages
                                        Historical and future unplanned outages between 10 - 12%

                              » Appropriate amount of planning margin for each control
                                area is still under review
                                  • PacifiCorp has transmission constraints on the East side of
                                     its system that may mandate a higher planning margin
                                     requirement
                                  • More flexibility on West side of PacifiCorp system


                                                                                                5
Next Steps - Studies & Issues
Goals of IRP
                             » Studies Under Review:
»   Plan for new resources
    to provide reliable         • Demand-elasticity in our load forecast
    service
                                • Reliability and economic risk associated with varying
»   Gain key stakeholder             planning margin levels
    involvement and
    commitment                   •   Capacity contributions associated with wind plants
»   Comply with PUC              •   Different planning margin requirements for transmission
    requirements                     constrained areas
»   Gain PUC
    acknowledgement of the   » Issues
    Action Plan                 • Appropriate trade-off between risk and cost is a
»   Foundation for future            policy/regulatory issue
    investment and long
    term business planning       •   Building reserves is expensive - production cost models
                                     should always choose less reserves unless extreme
                                     assumptions are made for market prices & penalties




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