2019 TAG Meeting #4 - PSE
2019 TAG Meeting #4:System planning (transmission anddistribution), portfolio sensitivities,and load forecastJanuary 9, 2019 TAG #4
Welcome Opening remarks Safety message IntroductionsJanuary 9, 2019 TAG #42
Meeting objectives PSE presents the status and progress for system planningcommitments in the 2019 IRP and changes PSE is making toincorporate non-wire alternatives and distributed energy resourcesinto the baseline process PSE presents the proposed portfolio sensitivities to be modeled inthe 2019 IRP PSE explains the load forecast methodology and resultsJanuary 9, 2019 TAG #43
Action items from priorIRPAG and TAGmeetingsJanuary 9, 2019 TAG #4
Open action items from previous IRPAG and TAG meetingsActionitem #Description(and meeting reference)PSE actionStatus1Identify contact for PSE’scarbon reduction goals.(IRPAG #1, May 30, 2018)PSE will include a listeningsession at the March 18,2019 IRPAG meeting #3.2PSE will model variousInclude carbon impact inscenarios or sensitivities.carbon impacts.(IRPAG #1, May 30, 2018 andTAG #2, October 11, 2018)3Investigate converting the gasemission rate to apercentage. (TAG #2,October 11, 2018 and TAG#3, December 6, 2018)PSE will include gasemission rate as apercentage in the draft IRPand the final IRP.In progressCompleteComplete;informationdistributedvia emailJanuary 9, 2019 TAG #45
Open action items from previous IRPAG and TAG meetingsActionitem #Description(and meeting reference)PSE actionStatus4Provide graphics to illustratethe IRP process.(TAG #2, October 11, 2018)PSE provided a graphic atthe December 6 TAGmeeting and relevantgraphics will be providedthroughout the rest of the2019 IRP process.Complete5Distribute the updatedsensitivity handout on October19. (TAG #2, October 11,2018)PSE distributed the portfolio Completesensitivities for considerationon October 19 to the TAGmembers via email.6Provide an updated IRPstakeholder meeting scheduleby December 31, 2018.(TAG #3, December 6, 2018)PSE uploaded the revisedschedule towww.pse.com/irp by12/31/18.CompleteJanuary 9, 2019 TAG #46
Open action items from previous IRPAG and TAG meetingsActionitem #Description(and meeting reference)PSE actionStatus7Provide a description of thedifference between the 2017and 2019 combined heat andpower potential prior to theMay 15, 2019 Draft IRP.(TAG #3, December 6, 2018)PSE will provide thedescription byMarch 29, 2019.In progress8Consider Lohr’s request topost and redistribute questionsand answers that PSEreceives.(TAG #3, December 6, 2018)CompletePSE will not redistributeinformation and take liabilityof information that may beinaccurate.9Finalize meeting notes fromTAG #3.(TAG #3, December 6, 2018).PSE distributed theCompletemeeting notes onDecember 20; stakeholdersprovided feedback byDecember 27; and PSEposted the notes onJanuary 3, 2019.January 9, 2019 TAG #47
IRP analytical process overview PSE has established an analytical framework to develop its 20-yearforecast of demand side resources and supply side resources thatappear to be cost effective to meet the growing needs of our customers.January 9, 2019 TAG #48
System Planning(transmission and distribution)January 9, 2019 TAG #4
IRP and Delivery System planning differentbut linked closely Integrated Resource Planning (IRP) optimizesresources which deliver power to grid Delivery System Planning (DSP) ensures thatelectricity gets to our customersExisting grid design – push power to customersEPRI - 2014January 9, 2019 TAG #410
Electric utility transmission planning Transmission planningperformed by electricutilities for the bulk electricsystem (generally linesabove 100kV)Analysis performed byutilities certified by NERCand WECCAnalysis must includeeffects on PSE system aswell as neighboring utilitiesin WECCColumbiaGrid is the regionalplanning entityNERC - North American Electric Reliability CorporationWECC – Western Electricity Coordinating CouncilJanuary 9, 2019 TAG #411
Why we plan - objectives Meet our customer’s energy and capacityrequirements in a safe and reliable manner atall times. Greatestneed is at system peak Annual NERC Transmission Planning (TPL) studiesexamine needs over 10-year time horizon Must also satisfy NERC and WECCrequirements so that outages do not affectother WECC utilities Expand system in cost effective mannerJanuary 9, 2019 TAG #412
Why we plan - impacts Failure to reliably serve load can result in Significant economic lossPublic safety risks to our customersCost of outages E-Source study estimated that power outages cost businesses 27 billion in 2016Outages increasing over time –Eaton’s 2017 Blackout Tracker 2009 - 2,840 outage events which affected 13 millionpeople 2017 – 3,526 outage events which affected 37 millionpeopleJanuary 9, 2019 TAG #413
Why we plan – requirements PSE obligated to serve - RCW 80.28.110Must comply with NERC and WECC reliabilitystandardsJanuary 9, 2019 TAG #414
NERC Standards 101 NERC develops and enforcesstandards for interconnected utilities Planning standards are designedto ensure a reliable and securetransmission dardJanuary 9, 2019 TAG #415
Delivery System Planning (DSP):How we determine grid needs and capacitySystemEvaluationSystem performanceLoad forecastsExternal Inputs GoalsCommitmentsOptimize withother projectsInvestment DecisionOptimization ToolprocessResource planningSystem needs,modeling &analysisIssue(s) identificationSystem modelingProbabilistic outcomesAlternatives Financialanalysis Cost I BenefitFinal Plan:portfolio ofprojectsManagement reviewand approvalAlternatives &recommendedsolutionPeer and managementreviewProjectImplementationMobilize resources tocomplete projectStudy frequency: Annual TPL studiesexamine needs over 10-year time horizonJanuary 9, 2019 TAG #416
PSE planned major projects Multiple delivery projects in-flight in variousstages: planning, implementation, or closeoutProject NameEst in Svc.White River – Electron Heights 115 kV Line Re-rte to Alderton (Phs 2)2018Pierce County Transformer Addition2018Talbot 230 kV Bus Improvements (Phase 2)Bellingham 115 kV Substation Rebuild20182019Lake Hills – Phantom Lake New 115 kV Line2019Sammamish – Juanita New 115 kV Line2020Energize Eastside2020Electron Heights – Enumclaw 55-115 kV Conversion2020Sedro Woolley - Bellingham #4 115 kV Rebuild and Reconductor2021Bainbridge Island Transmission Project2021Lynden Substation Rebuild and Install Circuit Breaker 20232022Kent / Tukwila New Substation2023Black Diamond Area New Substation2023Issaquah Area New Substation2023West Kitsap Transmission Project2023Bellevue Area New Substation2024Spurgeon Creek Transmission Substation Development (Phase 2)2024Electron Heights - Yelm Transmission Project2024Inglewood – Juanita Capacity Project2025January 9, 2019 TAG #417
Traditional drivers of DSPTraditional drivers/criteria Customer request Growth Reliability Compliance NERC & WECC rules Aging Infrastructure Integration ofresourcesJanuary 9, 2019 TAG #418
New opportunities for DSP Transmission infrastructure is increasinglydifficult and time consuming to build PSE DSP must adapt to changing mix andlocations of resources and still meet the needs ofits customers Not your stodgy utility anymore!PSE is committed to develop a modern gridthat will enable our customers flexibility touse DER, storage and EVsJanuary 9, 2019 TAG #419
DSP drivers of change PSE grid modernization efforts have the followingopportunities: Solar & wind require 2-3 times more capacity than thermal Grid-scale renewable resources require transmission specific to theirneeds Robust distribution network is needed to support high penetration ofcustomer-connected renewables There is potential for new laws which mandate more renewableresources There is potential for explosive growth in EV along with moderategrowth in residential/small commercial rooftop solar with storagewould require redesign of local grid to permit two-way flow of powerJanuary 9, 2019 TAG #420
Transformed DSP will build to new grid model DSP will build to a grid with extensive penetrationof DER and two flow of electricity.Requires inputs fromIRP – value of capacityand energy, etc.Future grid design – two –way power flows with high DER/EV penetrationEPRI - 2014January 9, 2019 TAG #421
DSP will assess the potential for use ofDER on all large projects DSP will be linked closelywith IRP Goal is to examine NWAoptions for all major gridprojects DSP will have a separate,open and transparentstakeholder involvementprocess DSP will be advised byteam of nationallyrecognized technicalexperts from universities,research institutes andelectric utilitiesTeam structure modeled after HawaiianElectric Integrated Grid Planning ProcessTechnical Advisory CommitteeJanuary 9, 2019 TAG #422
Integration of DSP and IRPFor non-wires options, modelcharacteristics available to meetsupply needs; include as inputin next IRP cycleEvaluate cost vs. benefitidentifying best optionsby locationForecasts &assumptionsGridrequirements/local needsGrid Analysis* Consider wire andnon-wire option for eachidentified delivery needIRP AnalysisIRP InputsNon-wire &wire optionsValue of system services( /unit of service location and timespecific as needed)January 9, 2019 TAG #423
DSP in other StatesDSP in HI, CA and NY will transformgrid from centralized unidirectionalpower flow to grid with bi-directionalpower flows.These changes are driven by Rapid increase in the installation ofresidential and commercial roof topsolar Personal and grid-scale energystorage systems and electricvehicles Demand response programs andenergy efficiency Customers will have increasedchoice and flexibility to manage andcontrol electricity useThese changes have the potential todefer or substitute for largeinvestments in power plants andgrid infrastructure.January 9, 2019 TAG #424
DSP drivers in other states High residential electric rates – .25/kWh - .55/kWh Summer peaking Passed 100% renewable RPSlegislation (CA and HI) Rapid deployment of Residential andcommercial roof top solar (CA & HI) Time of use rates with .10/kWh .25/kWh differential Aggressive Load Modifying DemandResponse programs California building code net energyzero by 2020 for residential andsmall commercialJanuary 9, 2019 TAG #425
Grid transformation considerations:Western Washington Low residential electric rates Winter peaking area withlocalized summer peakingchallenges Low wholesale power prices Potential RPS increase Annual solar energy output 50% below CA and HI Western Washington solarcapacity factor higher insummer and lower in winterJanuary 9, 2019 TAG #426
DSP key analytical requirementsHosting capacity analysisLocational value analysisDER kWby feederWhat is loadgrowth?Capacity and energy forecastWhat is thevalue ofDER?PilotprojectresultsRole of pilot process todemonstrate PSEcommitmentJanuary 9, 2019 TAG #427
DSP evolution at PSEIntegrated Grid Planning (IGP)requires significant investmentin people, process andtechnology Modernize grid design toenable higher penetration ofDER while maintainingpower quality, reliability andsafety. Key technology enablers forIGP under development atPSE: Advanced MeteringInfrastructure (AMI)Automated DistributionManagement System (ADMS)Distributed Energy ResourceManagement System (DERMS)Committed to continuousimprovementPSE Integrated GridPlanningNet benefits oforecasts NWAlocationalvalueanalysisgridplanningResource andgrid investmentroadmapJanuary 9, 2019 TAG #428
Status on 2018 Grid Planning commitments Considering the full range of DERand NWA options for four focusareas: Bainbridge – draft analysiscomplete and under review,assisted by Navigant and QuantaThree other areas under variousstages of analysis and reviewIncluding quantitative analysis forenergy storage impacts Working on having a separate,open and transparent stakeholderinvolvement process for DSP Continuing work on energy storagepilot projects that will provideadditional quantitative analysis forenergy storage impactsJanuary 9, 2019 TAG #429
Lunch breakJanuary 9, 2019 TAG #4
Portfolio sensitivitiesJanuary 9, 2019 TAG #4
Description of scenarios and sensitivities Scenarios are different sets of assumptions that create futurepower market conditions and regulations. Sensitivities test different resource portfolios of supply and demandside generation for PSE. When looking at a sensitivity, PSE examines different aspects ofhow the portfolio changed, such as: Resource mix Portfolio cost Portfolio greenhouse gas emissionsJanuary 9, 2019 TAG #432
Scenarios (review from TAG #2) Portfolios will be developed for each deterministic scenario with afocus on greenhouse gas regulationMid-C PowerPrice Nominal( /MWh)DemandGas Price 33.92MidMidNone2Current command &control regulationLow carbon price 43.62MidMidI-16313Social cost of carbon 60.14MidMid 42/metric ton(2007 )4 69.18MidMid 62/metric ton(2007 )5High social cost ofcarbonLow 29.23LowLowNone6High 81.23HighHigh 62/metric ton(2007 )Scenario1CO2 PriceNote: All scenarios account for all existing policies such as state RPS requirements, CAAB32, and BC CO2 policyJanuary 9, 2019 TAG #433
Sensitivities input process PSE presented 18 electric and gas sensitivities during TAGmeeting #2 on October 11, 2018 TAG members’ feedback expanded the portfolio sensitivities to 31 PSE distributed the modified table of sensitivities showing thelevel of effort PSE asked TAG members to rank up to ten sensitivities theywould prioritize for PSE to work on TAG members submitted ranked sensitivities by October 31, 2018January 9, 2019 TAG #434
Input received 10 TAG members selected portfolio sensitivities:James Adcock, TAG Member at LargeFortisBCPublic CounselVashon Climate Action GroupWUTC StaffRenewable NorthwestNational Grid VenturesCitizens’ Climate LobbyNorthwest Energy CoalitionClimate SolutionsJanuary 9, 2019 TAG #435
Ranking sensitivities TAG members’ results were analyzed by giving points to rankingsusing the following approach: A ranked vote of #1 gets 10 points, a ranked vote of #2 gets 9points, and so on, until a ranked vote of #10 gets 1 point Unranked ballots were all given 1 point Points were added to determine overall rank by point total sothat ranked votes are emphasizedJanuary 9, 2019 TAG #436
Main themes of TAG member input Clear preference for clean energy standards and emissionreductions as well as the retirement of Colstrip units 3 and 4 by2025 Clean Energy Standard: Net Zero by 2030 was present on 7of the 10 ballots Ranked #1 on 2 ballots and ranked #2 on 2 ballots Force Retirement of Colstrip 3&4 by end of 2025 was presenton 9 of the 10 ballots Ranked #1 on 1 ballot and Ranked #2 on 1 ballotJanuary 9, 2019 TAG #437
Summary of 2019 IRP folioEmissionReductionPolicies1.2.Clean Energy Standard: net zero by 2030100% Clean Energy Standard: no fossil fuel plants by2030CO2 emission reduction: 80% by 2035CO2 emission reduction: PSE’s 50 x 2040 GoalCarbon Abatement CurveElectricElectric59ElectricElectric & ng market reliance for peak capacityDeclining market reliance: hydro sliceIncreasing market reliance for peak capacity: Colstriptransmission ctionsResourceAssumptions9.Force retirement of Colstrip: 3&4 by end of 2025 Depending on results of portfolio analysisDemand side resources: extended DSR potentialDemand side resources: alternative discount rateAlternative resource costsShortened life of new baseload gas plants: 20 yearsNo LNGForce retirement of Colstrip: 1&2 by end of 2019Force retirement of Colstrip: 1-4 by end of 2019Electric2Electric & GasElectric & 1.12.13.14.15.16.13Note: refer to handout for complete resultsJanuary 9, 2019 TAG #438
Possible future IRP sensitivitiesSensitivity 30: Gas to Electric Conversions (Rank 7) PSE agrees that this is an important issue which will bestudied extensively in the next IRPSensitivity 27: Higher Electric Vehicles with Load Shaping (Rank 9) PSE will provide a qualitative discussion of peak load impactsof electric vehicles The WUTC just approved PSE’s electric vehicle pilotJanuary 9, 2019 TAG #439
Modeling next steps PSE will endeavor to model portfolios for the ranked sensitivities PSE will examine different aspects of how the portfolio changed,such as: Resource mix Portfolio cost Portfolio emissions Available results of the electric and gas portfolio sensitivitiesmodeling will be presented at TAG meeting # 6 on April 18, 2019January 9, 2019 TAG #440
Load forecastJanuary 9, 2019 TAG #4
Outline for load forecasting Forecast performance Role of load forecast in IRP Review of the 2019 IRP load forecast results Electric Gas Forecasting methodology overview Drivers of the forecastJanuary 9, 2019 TAG #442
Forecast performance PSE updates and adopts a new long-term load forecast each yearForecasts are projections of future load with normal temperaturesEach forecast is tracked in its initial year by comparing forecasted valuesto “weather-normalized” actual loads observed “weather normalization” – what would have happened had weexperienced 30 year average weather conditionsGiven what actual loads would have been under normal weathercircumstances, we can measure forecast performanceForecast toWeatherNormalizedActual %VarianceForecast 8021.591.3January 9, 2019 TAG #443
Role of load forecasts in the IRP The 20-year load forecasts are used as an input into the IRP, anddo not include long-term projections of conservation Note: demand side resource measures through December2019 (i.e., committed targets) are included in the load forecast The IRP analysis determines the most cost-effective amount offuture conservation to include in the resource plan Demand is reduced significantly when forward projections ofconservation savings are applied This presentation is the load forecasts used as an input into theIRP analysis, therefore is the load forecast before forwardprojections of conservation are appliedJanuary 9, 2019 TAG #444
Electric load forecast Very similar 2017 IRP and 2019 forecasts: upward and downward drivers havebalanced each other outDownward driving forces in short term are a revised retail rate/consumer priceindex forecast, incorporation of 2016/2017 actual loads, and Microsoft’s exitMajor new growth drivers: Near term: More new large loads coming online (i.e., “block loads”) Long term: Electric transportation infrastructure (both vehicles and transit)January 9, 2019 TAG #445
Electric peak forecast The Peak forecast projects electric peaks that occur at 23 degrees FahrenheitComparing the 2019 Peak Load forecast to the 2017 forecast: The Peak Load forecast uses the Load forecast, which results in thedownward shift in the 2019 Peak Load forecast compared to 2017 2019 incorporates observations of system temperature sensitivity from theJanuary 2017 peak event (resulting in a downward shift), whereas the 2017forecast’s most recent cold weather event was February 2014January 9, 2019 TAG #446
Electric customer forecast by class Residential and commercial customer growth drive year to year system loadgrowth2019 customer count projections differ very little from 2017 for residential andcommercial classesJanuary 9, 2019 TAG #447
Electric energy use per customer forecast Residential EV load forecast assumptionproduces a modest upward longterm trend Commercial Some larger-use customeradditions causing a bump in theearly 2020s In comparison to the 2017 IRPshifted down partially due to alarge customer exit Industrial Some larger-use customeradditions causing an uptick inthe near termJanuary 9, 2019 TAG #448
Electric load forecast by class Residential and Commercial customer growth drive year to year systemload growthComparing the 2019 forecast to the 2017 forecast: 2019 forecast assumes less load in the Commercial and Industrialclasses, but more in the Residential class Residential electric vehicles are included in 2019 forecast, whichimpact Residential load share in long termJanuary 9, 2019 TAG #449
Gas load forecast The 2019 load forecast is overall lower than the 2017 load forecastIn the near team, slightly higher loads due to higher customer counts and theincrease in employmentIn the long term, lower customer counts are driving the load forecast downOverall system use per customer is driven by lower industrial and interruptible useper customerJanuary 9, 2019 TAG #450
Gas peak load forecast The peak forecast projects gas peaks that occur at 13 degrees FahrenheitThe peak forecast has decreased because forecasted loads have come downSince the last forecast, PSE was better able to capture the weather sensitivity withthe 2017 cold yearJanuary 9, 2019 TAG #451
Gas customer forecast by class Residential customers are the major source of growth in number of customersCommercial customer counts are increasing as wellIndustrial customer counts are declining over timeInterruptible and transport classes have very few customersJanuary 9, 2019 TAG #452
Gas energy use per customer forecast Residential Slight downward long-termtrend driven by increase inretail rates Commercial Driven by increases inemployment Partially offset by increase inretail rates Industrial Driven by manufacturingemploymentJanuary 9, 2019 TAG #453
Gas load forecast by class Residential loads are growing more slowly in the 2019 forecast comparedto the 2017 forecastCommercial loads are lower and are growing more slowly in the 2019forecast compared to 2017, due to lower commercial customer countsIndustrial and Interruptible loads are slightly lower than the 2017 forecast,and are declining more quicklyJanuary 9, 2019 TAG #454
Base, high, and low forecast scenarios High and low forecasts arecreated by varyingeconomic conditions,customer growth, andweather conditions using aMonte Carlo simulation The 2019 base peakforecasts are lower thanthe 2017 base forecast,therefore the high and lowforecasts are also lower inthe 2019 forecastJanuary 9, 2019 TAG #455
Load forecast developmentJanuary 9, 2019 TAG #456
Load forecast modelsTotalEnergyCustomerCountsTypical Drivers:o Populationo Housing Permitso EmploymentEnergy UsePer CustomerTypical Drivers:o Employmento Energy retail rateso Personal Incomeo Weather STEP 1: Compile actual history Compile actual PSE sales data and drivers Determine the relationship of drivers to customer growth and sales STEP 2: Forecast the future Compile forecasts of economic and demographic drivers, normal weather Apply historical relationships to forecasts of drivers and normal weatherJanuary 9, 2019 TAG #457
Economic & demographic model:data sources Historical data are sourcedfrom a number of externaldata sources, includinglocal and federal agencies US-level forecasts comefrom Moody’s AnalyticsJanuary 9, 2019 TAG #458
Economic & demographic model:population forecast The forecasted trend for thePSE service area is similarto the national trendpredicted by Moody’sAnalytics Higher population growthrate in recent history thanpreviously forecasted Decline in populationgrowth rate due to lessforecasted immigration tothe USJanuary 9, 2019 TAG #459
Economic & demographic model:employment forecast The forecasted trend for thePSE service area is similarto the national trendpredicted by Moody’sAnalytics Tax stimulus is causingmore forecasted growth in2018 (i.e., an increase injobs in the short term) More softening expectedaround 2020/2021 due tothe recession anticipatedby Moody’s AnalyticsJanuary 9, 2019 TAG #460
Temperature for electric design peak The most common minimum temperature during winter peak hours is23 F. Heating Season Minimum TempNumber ofOccurrences54321January 9, 2019 TAG #46130 F29 F28 F27 F26 F25 F24 F23 F22 F21 F20 F19 F18 F17 F16 F15 F14 F013 7242226262312 120122013201420152016Frequency of Heating Season MinimumTemperaturesDuring Peak Hours (1987-2017)11 F( F) During Hours8AM to 9PM10 F(November –February)
Electric Vehicles E3 electric vehicle (EV) forecastCharging load occurs in bothresidential and commercialclassesForecasted EV load increases to2% of total load and peakforecasts by 2030, and 3% bythe end of forecast periodJanuary 9, 2019 TAG #462
Other drivers Short-term block loads (known new large additions/deletions to system) Electric block loads Downtown Bellevue, developments, Sound Transit, indoorhorticulture Gas block loads Incorporating new, large gas developments in downtown Seattleas well as other locations Retail rate forecastJanuary 9, 2019 TAG #463
Next stepsJanuary 9, 2019 TAG #4
Next stepsDateActionJanuary 23PSE posts draft meeting notes with action items onIRP website and distributes draft meeting notes toTAG membersJanuary 30TAG members review meeting notes and providecomments to PSEFebruary 6PSE posts final meeting notes on IRP website:www.pse.com/irpJanuary 9, 2019 TAG #465
THANKYOUJanuary 9, 2019 TAG #466
IRP comment periodJanuary 9, 2019 TAG #4
PSE explains the load forecast methodology and results . Action items from prior IRPAG and TAG meetings January 9, 2019 TAG #4 . emission rate to a percentage. (TAG #2, October 11, 2018 and TAG #3, December 6, 2018) . Talbot 230 kV Bus Improvements (Phase 2) 2018 Bellingham 115 kV Substation Rebuild
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7. In the search result, double-click the tag name to select it in the Tag Viewer. Note: To add the tag to the watch window, click Add to Watch. Performing a Quick Search Tag Viewer allows you to search for a tag quickly, if required. To perform a quick search 1. In the search box above the left pane, enter all or part of the tag name.
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