Avista Corporation · NYSE:AVA
Avista — Technical Presentation (September 2022)
72 slides from Avista's technical presentation, Sep 7, 2022
Slide 1: 2023 Electric Integrated Resource Plan TAC Meeting No. 5 Agenda
2023 Electric Integrated Resource Plan Technical Advisory Committee Meeting No. 5 Agenda Wednesday, September 7, 2022 Microsoft Teams Virtual Meeting Topic Time Staff Introductions 12:30 John Lyons IRP Generation Option Transmission Planning Studies 12:40 Dean Spratt Distribution System Planning wit
Slide 2: 2023 IRP Introduction
2023 IRP Introduction 2023 Avista Electric IRP TAC 5 – September 7, 2022 John Lyons, Ph.D. Senior Resource Policy Analyst
Slide 3: Meeting Guidelines
Meeting Guidelines • IRP team is working remotely and is available for questions and comments • Stakeholder feedback form • Responses shared with TAC at meetings, by email and in Appendix • Would a form and/or section on the web site be helpful? • IRP data posted to web site – updated descriptions a
Slide 4: Virtual TAC Meeting Reminders
Virtual TAC Meeting Reminders • Please mute mics unless commenting or asking a question • Raise hand or use the chat box for questions or comments • Respect the pause • Please try not to speak over the presenter or a speaker • Please state your name before commenting • Public advisory meeting – comm
Slide 5: Integrated Resource Planning
Integrated Resource Planning The Integrated Resource Plan (IRP): • Required by Idaho and Washington* every other year • Washington requires IRP every four years and update at two years • Guides resource strategy over the next twenty + years • Current and projected load & resource position • Resource
Slide 6: Technical Advisory Committee
Technical Advisory Committee • Public process of the IRP – input on what to study, how to study, and review of assumptions and results • Wide range of participants involved in all or parts of the process • Please ask questions • Always soliciting new TAC members • Open forum while balancing need to
Slide 7: Remaining 2023 IRP TAC Meeting Schedule
Remaining 2023 IRP TAC Meeting Schedule • TAC 5: September 7, 2022 • TAC 6: September 28, 2022, 12:30 – 4:00 pm • Public Participation Partners opportunity to comment on Avista’s advisory groups • September 12, 2022, 11:00 am to 12:00 pm or September 13, 2022, 9:00 am to 10:00 am • TAC 7: October 11
Slide 8: Today's Agenda
Today’s Agenda 12:30 Introductions, John Lyons 12:40 IRP Generation Option Transmission Planning Studies, Dean Spratt 1:45 Distribution System Planning within the IRP, Damon Fisher Break 3:00 Social Cost of Greenhouse Gas for Energy Efficiency (WA Only), James Gall 3:15 Avoided Cost Rate Methodology
Slide 9: Integrated Resource Plan Transmission Planning Studies
Integrated Resource Plan (IRP) Transmission Planning Studies Dean Spratt, Transmission Planning Technical Advisory Committee Meeting September 07, 2022
Slide 10: FERC Standards of Conduct
FERC Standards of Conduct Summary of requirements • Non-public transmission information can not be shared with Avista Merchant Function employees. • There are Avista Merchant Function employees attending today. • We will not be sharing any non-public transmission information. Avista’s OASIS is where
Slide 11: Agenda
Agenda • Introduction to Avista System Planning – Useful information about Transmission Planning – Overview of recent Avista projects • Generation Interconnection Study Process – Integrated Resource Plan (IRP) Requests – Large Generation Interconnection Queue – Transition to Cluster Study Process 3
Slide 12: Introduction to Avista System Planning
Introduction to Avista System Planning Avista’s System Planning Group includes: • Distribution Planning • Transmission Planning – Focus on reliable electric service • Federal, regional, and state compliance • Regional system coordination – Provide transmission service and system analysis • Planned l
Slide 13: Information About Transmission Planning
Information About Transmission Planning • Our focus is the Bulk Electric System (BES) – Avista’s 115 kV and 230 kV facilities (>100 kV) • We identify issues where Avista’s BES won’t reliably deliver power to our customers • Then we develop plans to fix it – “Corrective Action Plans” – Mandated and d
Slide 14: NERC Standard TPL-001-4
NERC Standard TPL-001-4 • Describes outage conditions we must study – P0: everything online and working – P1: single facility outages, like a transformer – P2, P4, P5 & P7: multiple facility outages – P3 & P6: overlapping combination of two facilities 6
Slide 15: TPL-001-4, cont.
TPL-001-4, cont. • A couple of NERC directives for the above faults – “The System shall remain stable” • Cascading and uncontrolled islanding shall not occur – “Applicable Facility Ratings shall not be exceeded” • Equipment ratings, voltage, fault duty, etc – “An objective of the planning process is
Slide 16: Two Approaches to Reliability Issues
Two Approaches to Reliability Issues • Transmission Operations (TO) are guided by significantly different standards than Transmission Planning (TP). • TO standards provide flexibility that TP standards do not allow – Operators can push system limits to SAVE the interconnected system • Shed load, ove
Slide 17: Standards are a Roadmap
Standards are a Roadmap • Western Systems Coordinating Council (WSCC) – Ensure that disturbances in one system do not spread to other systems. • Operating agreement with 40 electric power systems established in 1967 • Western Electricity Coordinating Council (WECC) – Responsible for coordinating and
Slide 18: Recent Transmission Projects
Recent Transmission Projects 10
Slide 19: Non-Wire Alternatives are Considered
Non-Wire Alternatives are Considered • We are documenting this with more clarity • Non-wire options require robust wires to perform – Avista is working on the transmission fundamentals 11
Slide 20: Evaluated Batteries for T-1-1
Evaluated Batteries for T-1-1 • TPL-001-4 ~ T-1-1 for long lead equipment – Double transformer outages • Shawnee 230/115 kV outage followed by a concurrent outage of Moscow 230/115 kV transformer. – Could we mitigate performance issues with storage? • Yes…but… We would need a 125 MW battery – Typica
Slide 21: Generation Interconnection Study Process
Generation Interconnection Study Process Process for Generation Requests • Two sources: • External developers • Enter via the OATT • Internal IRP requests • Feasibility Light Study…then OATT • AVA Merchant MUST follow the OATT just like external parties • Typical process: • Hold a scoping meeting to
Slide 22: Transition - Serial to Cluster Study Process
Transition - Serial to Cluster Study Process Challenges with Serial Interconnections • Large serial queues become difficult to process efficiently • Interdependency of projects becomes complicated • Studying single projects is inefficient compared to studying projects in a group • Projects that do n
Slide 23: Serial Process was Complex and Slow
Serial Process was Complex and Slow Interconnection Requests necessitated a better Process 15
Slide 24: Two-Phase Cluster Study Process
Two-Phase Cluster Study Process Benefits and Objectives • Create a more efficient process • Design a process with definitive timelines that can be consistently met • Allocate System Upgrades proportionally • Ensure commercially viable projects have a clear path for development • Alleviate the backlo
Slide 25: Current Interconnection Queue
Current Interconnection Queue 17
Slide 26: Transmission Integration Cost Estimates
Transmission Integration Cost Estimates Assume anti-islanding scheme is in place, but no remedial Action Scheme (RAS) 18 Preliminary estimates are given as -25% to +75%
Slide 27: Reardan: 100 MW
Reardan: 100 MW Choice of interconnection point may result in extensive system reinforcements 19
Slide 28: Espanola: 100 MW
Espanola: 100 MW Optimizing the interconnection point is a key benefit of the Cluster Study process 20
Slide 29: Questions?
Questions? Refer to Avista’s OASIS link for information regarding System Planning and the Interconnection Process: http://www.oasis.oati.com/avat/index.html 21
Slide 30: Distribution Resource Planning
Distribution Resource Planning Damon Fisher, System Planning Fifth Technical Advisory Committee Meeting September 7, 2022
Slide 31: Goals of Electric Distribution Planning
Goals of Electric Distribution Planning • Ensure electric distribution infrastructure to serve customers now and in the future with a focus on: – Safety – Reliability – Capacity – Efficiency – Level of service – Operational flexibility – Corporate/Regulatory goals – Affordability 2
Slide 32: Primary Goal of Distribution Resource Plan
Primary Goal of Distribution Resource Plan • Where possible, solve distribution grid deficiencies using distributed energy resources (DER) that also contribute to system resource needs as identified in the Integrated Resource Plan. 3
Slide 33: Can IRP resource needs and distribution fixes be aligned?
Can IRP resource needs and distribution “fixes” be aligned? Certainly. • Not without challenges. – Temporal need – Grid operation and flexibility – Resource adequacy- a new distribution definition? – System Protection 4
Slide 34: Typical Distribution System Deficiencies
Typical Distribution System Deficiencies • Low Voltage • Capacity (Substation/Feeder) • Asset Condition • Contingency Switching Limits 5
Slide 35: What are DERs? Distribution's Perspective
What are DER’s? – Distribution’s Perspective • Anything that can reduce demand or support voltage Real Targeted Energy Efficiency Targeted Demand Response Apparent Storage (Load shifting) Generation (Load service) 6
Slide 36: System Resources vs. Feeder Demand
System Resources vs. Feeder Demand 7
Slide 37: System Resources vs. Feeder Demand
System Resources vs. Feeder Demand 8
Slide 38: It Is All About Curves
It Is All About Curves • The ideal curve- 9
Slide 39: It is all about curves
It is all about curves • A real curve (not ideal)- 10
Slide 40: Can We Fix Curves with PV? Community Solar – Summer
Can We Fix Curves with PV? Community Solar – Summer 11
Slide 41: Can We Fix Curves with PV? Community Solar – Winter
Can We Fix Curves with PV? Community Solar – Winter 12
Slide 42: Can We Fix Curves with Just PV? Cloudy Day, Battery
Can We Fix Curves with Just PV? Community Solar – Cloudy Day, Battery 13
Slide 43: DRP Implementation
DRP Implementation- • Spatial Load Forecasting • Spatial DER Forecasting (gap) • System Performance Criteria • DER Acquisition and Implementation Processes (in process) • Engineering/Operational Expertise (in process) • Time series analysis • Hosting capacity maps (in process) • Non-Wired and Wired
Slide 44: Non-Wires Alternatives
15 Non-Wires Alternatives Reliability L Capacity Power Quality Transmission Connected ols sls ele . o C|G\s\G Hydrogen fuel-cell iS ie Storage ‘Short-duration (<=8hrs.) «lithium (NMC, LFP, LTO) ‘Medium-duration (>8hrs.& <=72hrs.) o ‘Long-duration (>72hrs.) Portable storage Immediate response storage
Slide 45: Generation Integration Costs
Generation Integration Costs – 5MW – assuming dedicated feeder bay and SCADA comms required - $975,000 to $1,350,000 – 1MW – assuming a feeder tap, viper, and SCADA comms required - $170,000 to $254,000 – 500kW - assuming tap the feeder with some upgrades - $24,000 to $36,000 – 100kW - assuming tap
Slide 46: Questions?
Questions? 17
Slide 47: Social Cost of Greenhouse Gas for Energy Efficiency
Social Cost of Greenhouse Gas for Energy Efficiency (Washington State Methodology) James Gall, Integrated Resource Planning Manager Electric IRP, Fifth Technical Advisory Committee Meeting September 7, 2022
Slide 48: Requesting TAC Input: $ per Metric Ton
Requesting TAC Input • Avista must include the Social Cost of GHG for Energy Efficiency selected – Per Clean Energy Transformation Act (CETA) for Washington customers. • There are three proposed options to incorporate the non-energy impact into resource planning. • Levelized SCGHG is estimated at $1
Slide 49: Methods Studied in the 2021 IRP
Methods Studied in the 2021 IRP 1) Incremental Method 2) Average Method – Uses regional GHG incremental – Uses regional GHG average emissions emissions rate for the Northwest rate for the Northwest Incremental GHG Pricing Methodology Average GHG Pricing Methodology 1,200 84 1,200 84 1,000 70 1,000 7
Slide 50: Wholesale Price Method
3) Wholesale Price Method • Apply SCGHG to all resources in the dispatch within Aurora model. • Creates new wholesale price forecast for energy efficiency avoided cost. • Caution: some wholesale price forecasts with SCGHG have an overbuild of renewables creating lower wholesale marginal prices. 2021
Slide 51: Results from 2021 Electric IRP
Results from 2021 Electric IRP Washington only savings (GWh) GWh Savings Incremental Average Wholesale No SCGHG Method Method Price Method 10-year savings 507.8 452.4 506.6 370.8 20-year savings 772.4 671.5 769.4 557.9 5
Slide 52: Options for 2023 IRP
Options for 2023 IRP • Incremental Method – SCGHG adder will be reduced to account for CCA price already included in dispatch. • Average Method – SCGHG adder will be reduced to account for CCA price already included in dispatch. • Market Dispatch Method – All regional resources dispatched with SCGHG
Slide 53: Valuing QF Resources (Avoided Costs)
Valuing QF Resources (Avoided Costs) Fifth Electric Technical Advisory Committee September 7, 2022 Clint Kalich, Senior Manager—Resource Analysis clint.kalich@avistacorp.com
Slide 54: Agenda
Agenda • Define qualifying facility or QF • Detail sizes in Federal, Idaho and Washington • Describe Washington QF methodologies (published vs. IRP method) • Define Idaho QF Rate methodologies (published SAR vs. IRP method) 2
Slide 55: PURPA Regulations
PURPA Regulations For Avista, defined by federal government and two states • Federal Rules (Public Utilities Regulatory Policy Act of 1978) • Buy all cogeneration, and non-cogeneration up to 80 MW, at rates defined by state rules • Qualifying non-cogeneration, with a couple of exceptions, defined as
Slide 56: QF Published Rate Eligibility
QF Published Rate Eligibility Washington • Projects up to 5 MW receive payments using a published rate schedule • Projects over 5 MW receive a negotiated rate • Based on conceptual methodologies of published rates • Adjustments (up/down) can be applicable to the extent the larger resource differs fr
Slide 57: Washington State Avoided Costs
Washington State Avoided Costs (IRP-Based Methodology) 5
Slide 58: Washington QF Value Streams
Washington QF Value Streams Payment consists of value streams dependent on resource/products offered • Commodity Energy • Peaking Capacity Value • Clean Energy Premium • Transmission • Contingency Reserves • Integration Charge for variable generation resources (wind/solar) • Others 6
Slide 59: Commodity Energy – Washington
Commodity Energy – Washington The most basic value associated with electricity provided to the grid • Latest-approved IRP energy price forecast • Priced in two blocks of on- and off-peak periods each month • Hours 0700-2200 defined as on-peak • Hours 0000-0700 and 2200-2400 are off-peak • Payment is
Slide 60: Transmission Credits and Charges – Washington
Transmission Credits and Charges – Washington Portfolio savings or costs associated with transporting energy to/from market • Credit paid in addition to others in hours IRP shows imported market power • Charge in addition to others in hours IRP shows imported market power • Rate equals BPA hourly Po
Slide 61: Variable Energy Resource Integration Charge – Washington
Variable Energy Resource Integration Charge – Washington Cost of incremental capacity services necessary to support grid reliability • Avista applies variable energy resource (VER) integration charge to all such resources, whether owned or contracted for • Covers various incremental ancillary servic
Slide 62: Peaking Capacity Value – Washington
Peaking Capacity Value – Washington The value of providing electricity to the grid during times of system peak demands • Fixed costs from one of two utility options: • Fixed costs associated with the last-approved- IRP’s first capacity addition fixed cost • Fixed costs associated with bids in most r
Slide 63: Defining Qualifying Capacity Credit (QCC)
Defining Qualifying Capacity Credit (QCC) 2021 IRP Data will be updated with WPP values once approved (WA & ID IRP Method) 11 From p. 9-28 of 2021 Avista Electric IRP
Slide 64: Contingency Reserves – Washington
Contingency Reserves – Washington Cost of regional obligation to hold capacity in the case of generation outages • Avista holds 3% of all generation on its grid, irrespective of technology type or ownership • Charge compensates for this cost • For published rates, a reduction equal to: • Peaking Cap
Slide 65: Clean Energy Premium Value – Washington
Clean Energy Premium Value – Washington Value of providing electricity to the grid that does not contain CO2e • Latest-approved IRP total resource value less Energy less Peaking Capacity Values • For published rates, value is added to the commodity energy schedule 13
Slide 66: Other Value Streams
Other Value Streams Washington • QF payments are based on generic resource type • Some resources might have values above the generic assumptions • e.g., dispatch flexibility, storage, interruption rights, local distribution benefits • It is not expected these values will be large for most resources,
Slide 67: Idaho State Avoided Costs (SAR-Based Methodology)
Idaho State Avoided Costs (SAR-Based Methodology) 15
Slide 68: Surrogate Avoided Rates (SAR)
Surrogate Avoided Rates (SAR) Idaho • Published rate based on IPUC-managed model • Based on the fixed and variable costs of a combined-cycle gas turbine • Natural gas fuel price updated annually using an EIA gas price forecast • Different pricing by resource type • Wind, solar, hydro, non-seasonal h
Slide 69: Surrogate Avoided Rates (SAR), Continued
Surrogate Avoided Rates (SAR), Continued Idaho • Note on capacity payments • Renewed contracts receive full capacity payment as part of production rate • New contracts receive capacity payment starting with first year the utility is capacity deficit • Renewable energy credits are kept by the QF 17
Slide 70: Idaho State Avoided Costs (IRP-Based Methodology)
Idaho State Avoided Costs (IRP-Based Methodology) 18
Slide 71: Differences between Idaho and Washington QF Rates
Differences between Idaho and Washington QF Rates • Idaho has its own and varying size limits for published QF rates • Wind and solar projects <= 100 kW • Non-wind, non-solar <= 10 aMW • Projects ineligible for published rates receive IRP-Methodology rates • Same methodology as described for Washing
Slide 72: Thank You
20 Thank You AIVISTA