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PSE IRP Presentation PowerPoint Presentation Deficit

VIEWS: 8 PAGES: 11

									Resource Planning Issues
NW Power Planning Council Meeting

                       Charlie Black
                       May 28, 2003
Portfolio Planning Levels Considered

 Planning
 Standard
                          Energy                           Capacity
              Current deficit grows with
 Do Nothing                                   Current deficit grows with demand
              demand

 Status Quo   2003 deficit level maintained   Deficit is maintained at 2003 level

 Level A1     Meets Nov-Feb customer needs    Deficit is maintained at 2003 level

 Level A2     Meets Nov-Feb customer needs    Meets 19 Degree F hour at SEA-TAC

              Meets highest deficit month
 Level B1                                     Meets 23 Degree F hour at SEA-TAC
              needs
              Meets highest deficit month
 Level B2                                     Meets 16 Degree F hour at SEA-TAC
              needs
              Meets 110% of highest deficit
 Level C1                                     Meets 13 Degree F hour at SEA-TAC
              month needs
              Meets 110% of highest deficit
 Level C2                                     Meets 13 Degree F hour at SEA-TAC
              month needs
PSE Need for New Resources -
Energy
   2,000
                         Status Quo
   1,800
                         Level A1, 2
   1,600
                         Level B1, 2
   1,400                 Level C1
   1,200                 Level C2

   1,000

    800

    600

    400

    200

      0
           2004   2006   2008          2010   2012
PSE Need for New Resources -
Capacity
   4,000
                  Status Quo           Level B1
   3,500

                  Level A2             Level B2
   3,000

   2,500          Level C1, 2


   2,000

   1,500

   1,000

    500

      0
           2004   2006          2008     2010     2012
Expected Cost to Customer
(For Combined Planning Levels)
                                    $4,400


                                    $4,200
   Expected Cost ($Millions)




                                    $4,000


                                    $3,800


                                    $3,600


                                    $3,400


                                    $3,200


                                    $3,000
                                               Do    Status   Level   Level   Level   Level   Level   Level
                                             Nothing Quo       A1      A2      B1      B2      C1      C2
                               Expected Cost $3,503 $3,821 $3,699 $4,187 $4,043 $4,234 $4,211 $4,151
Expected Cost to Customer
(By Energy Planning Level)
                         $4,000
    Expected Cost




                         $3,800




                         $3,600




                         $3,400
                                    Status   A1 Energy B1 Energy C1 Energy C2 Energy
                                     Quo      A1 Cap    A1 Cap    A1 Cap    A1 Cap

                    Expected Cost   $3,821    $3,699    $3,675    $3,610    $3,541
Expected Cost to Customer
(By Capacity Planning Level)
                                  $4,400
 Expected Cost ($-Millions)




                                  $4,200


                                  $4,000


                                  $3,800


                                  $3,600


                                  $3,400


                                  $3,200
                                              B1 Energy-
                                                           B1 Energy-23 B1 Energy-19 B1 Energy-16 B1 Energy-13
                                              Status Quo
                                                           Deg Capacity Deg Capacity Deg Capacity Deg Capacity
                                               Capacity

                              Expected Cost    $3,678        $4,049       $4,151       $4,237        $4,317
Expected Cost versus Risk

                                    20%
                                                                                            C2
                                    18%
 Expected Cost Standard Deviation




                                                                                      B1         C1
                                    16%                          A1

                                    14%                                                             B2
                                                                                            A2
           (% of Mean)




                                    12%
                                                                      Status Quo
                                    10%       B Energy A1 Capacity


                                    8%
                                    6%
                                    4%
                                    2%
                                    0%
                                     $3,400   $3,600           $3,800        $4,000        $4,200        $4,400
                                                           Expected Cost ($Millions)
Net Market (Purchase and Sale) Risk Exposure


                                                Net Market Positions by Planning Level

                             1,500.00
                             1,000.00
 Market Sales/(Purchases)
  20-Year NPV $-Millions




                               500.00
                                    -
                               (500.00)
                             (1,000.00)
                             (1,500.00)
                             (2,000.00)
                             (2,500.00)
                                            Do       Status
                                                                Level A1   Level A2   Level B1   Level B2   Level C1   Level C2
                                          Nothing     Quo

                            Purchases     (2,218.92) (895.98)   (740.50)   (739.76)   (593.28)   (593.25)   (500.17)   (346.84)
                            Sales          141.74    311.11     398.90     417.45     591.35     598.93     756.57     1,242.81
                            Net Position (2,077.18) (584.86)    (341.60)   (322.31)    (1.92)      5.68     256.40     895.97
PSE Load-Resource Balance
Pacific Northwest Region

                                               Regional resources:
                             Less than loads       Equal loads       Exceed loads


                 Less than
PSE resources:




                 loads


                 Equal
                 loads


                 Exceed
                 loads
   The recently updated Washington State Energy
   Strategy provides the following guidance*
                 Guiding Principle                                         Detailed Annotation

 #1 Encourage all load-serving entities to adopt          “…underscore the continuing obligation that the
    and implement resource plans to ensure they           state’s utilities have to serve their customers’ load
    have adequate resources to meet their                 requirements and to acquire the resources
    obligation to serve their customers’ projected        necessary to do so.”
    long term energy and capacity needs                   “…Recognize that current and future electricity
                                                          markets are likely to experience greater price
                                                          volatility, and supply risk than has historically
                                                          occurred prior to 2000.”
 #2 Encourage the development of a balanced,
    cost-effective and environmentally sound
    resource portfolio that includes conservation,
    renewables (e.g. wind, geo, hydro, biomass,
    and solar) and least-cost conventional
    resources
 #4   Preserve and promote Washington’s cost-             “…Washington continues to be extremely cautious
      based energy system to benefit the end use          about increasing its reliance on market forces to
      consumer by providing reliable power and            provide for its electric supply……the main question
      reduce the consumers’ vulnerability to supply       for Washington is the extent to which our load-
      shortage and price volatility. At the same time,    serving utilities rely on market purchases or their
      the state should promote policies that harness      own resources to serve their loads.”
      market forces in the wholesale energy market
      to reduce customer costs and increase
      reliability while protecting the environment

* Comments reflect selected excerpts from 3 of the 13 Guiding Principles

								
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