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Arizona Public Service Assessment of Renewable Energy Resources using the Western Renewable Energy Zones (WREZ) Model. January 2011. Guide. How to use this Presentation. Run the presentation in slide-show mode (Press F5) to use navigation buttons.
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Arizona Public ServiceAssessment of Renewable Energy Resources using the Western Renewable Energy Zones (WREZ) Model January 2011 Page - 1
Guide How to use this Presentation Run the presentation in slide-show mode (Press F5) to use navigation buttons • 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 slide Guide Page - 2
Guide Organization of Material in this Presentation • Introduction • Renewable Energy Demand • Identification of Most Economic WREZ Resources • Comparison to Local Resources • Maps of Top WREZ Resource Areas for APS • Slide by Slide Guide Page - 3
Introduction Page - 4
Guide 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? Purpose of this presentation is to address these key questions for APS using “base case” (default) assumptions for the GTM. Page - 6
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
Renewable Energy Demand Page - 8
Guide Modeled Renewable Energy Demand (GWh/yr) Notes –Load forecast values obtained from survey performed by LBNL. Page - 9
Guide GTM Resource Cost Determination Adjusted Delivered Cost of Energy Busbar Cost • Resource cost information provided by model: • Busbar cost: “raw” cost of generation • Delivered cost: cost to transmitenergy 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 Delivered Cost + Transmission Cost + Integration Cost - Energy Value - Capacity Value Adjusted Delivered Cost Page - 11
Guide WREZ Resources • 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 Page - 12
Guide Most Economic WREZResources • The GTM model was run with “base case” assumptions to identify the most economic resources to meet APS’s renewable demand • These are shown as the colored circles at right (“Hubs”) • Additional detail provided in the following slides Resource Key UT_WE NV_WE Hydro Wind Biomass Solar PV Solar Thermal Geothermal Hydro Wind Biomass Solar PV Solar Thermal Geothermal NV_SW CA_WE AZ_NW CA_CT CA_NE AZ_NE Note: Color represents the dominant resource in the Hub. CA_EA Page - 13 CA_SO NM_EA BJ_NO BJ_SO
Guide Supply Curves of All WREZ Resources and Top 100 TWh of Resources* All WREZ in WECC Most economic resources, detailed on next slide Page - 14 Page - 14 * Supply curves do not include local, non-WREZ resources
Guide Most Economic Resources Identified to Meet Renewables Demand: Individual Resources, Sorted by Cost 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. Page - 15
Guide Most Economic Resources Identified to Meet Renewables Demand: Individual Resources, Sorted by Cost (cont.) 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. Page - 16
Guide Most Economic Resources Identified to Meet Renewables Demand: Summary by Area, Sorted by Cost *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. Click here for Maps of Each Area Page - 17
Percentage of Hub Energy Identified as “Most Economic” for a Given Utility Guide Utilities That May be Interested in Similar Resource AreasGreater Potential Interest Indicated by Filled Circles
Percentage of Hub Energy Identified as “Most Economic” for a Given Utility Guide Utilities That May be Interested in Similar Resource AreasGreater Potential Interest Indicated by Filled Circles (cont.) Page - 19
Guide Annual Average Hourly Profiles in WREZ With Most Generation From That Resource Page - 20
Comparison to Local Resources Page - 21
Guide Potential Resources in APS Service Territory Legend Symbols not to Scale Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 DC Arizona Public Service Co LSE Service Areas Page - 22
Guide Potential Wind and Solar PV Resources in APS Territory See guide for important notes and assumptions Page - 23
Guide Economic Analysis of Local Resources in Service Territory WREZ Resources (Previous Supply Curve) Economics of Local Resources Page - 24
Maps of Top WREZ Resource Areas for APS Page - 25
Guide Nevada West Potential Resources Sierra Pacific Power Company SCE PG&E Sierra Pacific Power Company LADWP LSE Service Areas PG&E SCE Transmission Lines Nevada Power Company Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide Utah West Potential Resources PacifiCorp PacifiCorp PacifiCorp LSE Service Areas PacifiCorp Transmission Lines Pacifi- Corp Exist-ing Founda-tional Poten-tial PacifiCorp Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide Nevada Southwest Potential Resources Sierra Pacific Power Company Pacifi- Corp LADWP Pacifi- Corp SCE PG&E Nevada Power Co. SCE SCE LSE Service Areas Transmission Lines SCE Exist-ing Founda-tional Poten-tial Size (kV) SCE 230-499 APS 500 0 100 200 50 150 DC MILES
Guide California West Potential Resources SCE SCE PG&E SCE SCE SCE Imperial Irrigation District SCE SCE LADWP LSE Service Areas SCE • CA Renewable Energy Transmission Initiative (RETI) • Competitive Renewable Energy Zones in vicinity • Tehachapi • Fairmont • Kramer Transmission Lines SCE Exist-ing Founda-tional Poten-tial Size (kV) SDGE 230-499 500 0 100 200 50 150 DC MILES
Guide California Central Potential Resources SCE SCE PG&E SCE SCE LADWP SCE SCE SCE LADWP • CA Renewable Energy Transmission Initiative (RETI) • Competitive Renewable Energy Zones in vicinity • Pisgah • Victorville • Twentynine Palms • San Bernardino Lucerne • Barstow LSE Service Areas Imperial SCE APS Transmission Lines SDGE Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide California Northeast Potential Resources SCE Arizona Public Service Co. Nevada Power Southern California Edison (SCE) SCE Arizona Public Service Co. (APS) APS SCE SCE LSE Service Areas Imperial • CA Renewable Energy Transmission Initiative (RETI) • Competitive Renewable Energy Zones in vicinity • Iron Mountain Transmission Lines APS SDGE Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 APS 0 100 200 50 150 DC MILES
Guide California East Potential Resources SCE Arizona Public Service Co. SCE APS SCE SCE APS San Diego Gas & Electric APS LSE Service Areas APS • CA Renewable Energy Transmission Initiative (RETI) • Competitive Renewable Energy Zones in vicinity • Riverside East Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide California South Potential Resources SCE SCE Imperial Irrigation District SCE San Diego Gas & Electric Arizona Public Service Co. (APS) APS LSE Service Areas • CA Renewable Energy Transmission Initiative (RETI) • Competitive Renewable Energy Zones in vicinity • San Diego South • Imperial North • Imperial East • Imperial South Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide Baja North Potential Resources SCE APS San Diego Gas & Electric Imperial APS APS LSE Service Areas Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide Baja South Potential Resources LSE Service Areas Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide Arizona Northwest Potential Resources SCE Nevada Power SCE Arizona Public Service Co. SCE LSE Service Areas SCE Imperial Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Guide Arizona Northeast Potential Resources Arizona Public Service Co LSE Service Areas Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) SRP 230-499 500 0 100 200 50 150 DC MILES
Guide New Mexico East Potential Resources PSC of NM LSE Service Areas Transmission Lines Exist-ing Founda-tional Poten-tial Size (kV) 230-499 500 0 100 200 50 150 DC MILES
Slide-by-Slide Guide Page - 39
Guide Guide: Renewables Demand This slide shows a table which roughly indicates how much renewable energy the utility might be interested in under future scenarios. • 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.) *For California utilities, 2030 total demand is shown Page - 40
Guide 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). 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 Page - 41
Guide Guide: WREZ Resources Resource Hub Example resource Transmission Environmental exclusions Page - 42
Guide Guide: Supply Curve of WREZ Resources • 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. Page - 43
Guide Guide: Most Economic Resource Tables • This slide lists all of the individualWREZ 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 - 44
Guide Guide: Utility Comparison Matrix • 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. While other utilities may be interested in this zone, it is most economic for APS This zone is common to APS and SRP. A shared transmission solution may be economic Percentage of Hub Energy Identified as “Most Economic” for a Given Utility All California utilities may be interested in this zone, including some with significant interest. This indicates potential for competition and/or collaboration *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. Page - 45
Guide Guide: Annual Average Hourly Profiles • 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). Page - 46
Guide Guide: Utility Service Area Map Showing Local Resources Maps 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. Potential transmission line Existing transmission line Geothermal resource Resource legend Wind 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) Transmission line types Solar resources Page - 47
Guide Guide: Potential Local Resources • 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. 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 - 48
Guide Guide: Local Resource Economics • 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. 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 - 49
Guide Guide: WREZ Resource Maps Maps 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. Example foundational transmission line Mini-map showing selected hub and surrounding areas WREZ area of interest Solar resources Resource legend Geothermal resources Wind resources Transmission line types For California areas, any overlapping Competitive Renewable Energy Zones (CREZs) from the Renewable Energy Transmission Initiative are identified (map). Exclusions: lands removed from consideration for development due to environmental restrictions (e.g., wilderness area), or other land use constraints (urban areas) Page - 50