Avista Corporation · NYSE:AVA
Avista — Technical Presentation (November 2020)
85 slides from Avista's technical presentation, Nov 17, 2020
Slide 1: 2021 Electric IRP TAC Meeting No. 4 Agenda
2021 Electric Integrated Resource Plan Technical Advisory Committee Meeting No. 4 Agenda Tuesday, November 17, 2020 Virtual Meeting Topic Time Staff Introductions 9:00 Lyons Final Resource Needs Assessment 9:15 Lyons 2020 Renewable RFP Update 9:45 Drake Break 10:20 Portfolio Modeling Overview 10:30
Slide 2: TAC Introductions and IRP Process Updates
2021 Electric IRP TAC Introductions and IRP Process Updates John Lyons, Ph.D. Fourth Technical Advisory Committee Meeting November 17, 2020
Slide 3: Updated TAC Meeting Guidelines
Updated TAC Meeting Guidelines • IRP team working remotely through the rest of this IRP, but still available by email and phone for questions and comments • Some processes are taking longer remotely • Virtual IRP meetings until able to hold large group meetings again • Joint Avista IRP page for gas
Slide 4: Virtual TAC Meeting Reminders
Virtual TAC Meeting Reminders • Please mute mics unless speaking or asking a question • Use the Skype chat box to write questions or comments or let us know you would like to say something • Respect the pause • Please try not to speak over the presenter or a speaker who is voicing a question or thou
Slide 5: Integrated Resource Planning
Integrated Resource Planning • Required by Idaho and Washington* every other year • Guides resource strategy over the next twenty + years • Current and projected load & resource position • Resource strategies under different future policies – Resource choices – Conservation measures and programs – T
Slide 6: Technical Advisory Committee
Technical Advisory Committee • The public process piece 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 – Ask questions – Help with soliciting new members • Open forum while balancing need t
Slide 7: 2021 Electric IRP TAC Schedule
2021 Electric IRP TAC Schedule • TAC 1: Thursday, June 18, 2020 • TAC 2: Thursday, August 6, 2020 (Joint with Natural Gas TAC) • TAC 2.5: Tuesday, August 18, 2020 Economic and Load Forecast • TAC 3: Tuesday, September 29, 2020 • TAC 4: Tuesday, November 17, 2020 • TAC 4.5: December 2020 – 2 Hours on
Slide 8: Process Updates
Process Updates Available IRP Data: • Avista Resource Emissions Summary • Load Forecast • CPA Measures • Avista 2020 Electric CPA – Summary and IRP Inputs • Home Electrification Conversions • Named Populations • Natural Gas Prices • Social Cost of Carbon Files Added Since TAC 3: • High and Low Natur
Slide 9: Today's TAC Agenda
Today’s TAC Agenda 9:00 Introductions, Lyons 9:15 Final Resource Need Assessment, Lyons 9:45 2020 Renewable RFP Update, Drake 10:20 Break 10:30 Portfolio Modeling Overview, Gall 11:30 Lunch 12:30 Draft PRS and Scenarios, Gall 2:00 Adjourn 8
Slide 10: 2020 Electric IRP Resource Need Assessment
2020 Electric IRP Resource Need Assessment John Lyons, Ph.D. Fourth Technical Advisory Committee Meeting November 17, 2020
Slide 11: Load & Resource Methodology Review
Load & Resource Methodology Review • Sum resource capabilities against loads • Resource plans are subject to 5% LOLP analysis – determines planning margins • Colstrip is included through 2025 per 2020 IRP • Capacity – Planning Margin (16% Winter, 7% Summer) • Using 2020 IRP result; pending future an
Slide 12: One Hour Peak Load & Resource Position
One Hour Peak Load & Resource Position 1 Hour Peak Load & Resource Position 400 300 January 200 August 100 Megawatts 0 (100) (200) (300) (400) (500) (600) (700) 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 3
Slide 13: 18-Hour Peak Load & Resource Position
18-Hour Peak Load & Resource Position 18 Hour Peak Load & Resource Position 400 January 300 August 200 Megawatts 100 0 (100) (200) (300) (400) (500) 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 4
Slide 14: Energy Load & Resource Position
Energy Load & Resource Position Energy Load & Resource Position 400 January 300 August 200 Annual 100 Megawatts 0 (100) (200) (300) (400) (500) (600) (700) 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 5
Slide 15: Avista's Clean Energy Goal
Avista’s Clean Energy Goal Goals • 2027 – 100% carbon-neutral • 2045 – 100% clean electricity How we will get there • It’s not just about generation – various solutions are necessary • Maintain focus on reliability and affordability • Natural gas plays an important part of a clean energy future • Co
Slide 16: Washington State Clean Energy Goals
Washington State Clean Energy Goals • Energy Independence Act or Initiative 937 – 15% of Washington retail load after 2020 – Not modeling for this IRP since CETA takes us beyond 15% – Last IRP anticipated the inclusion of qualifying BPA and Wanapum generation, neither of which materialized • Avista
Slide 17: 2020 Renewable RFP Update
2020 Renewable RFP Update Chris Drake, Wholesale Marketing Manager Fourth Technical Advisory Committee Meeting November 17, 2020
Slide 18: Justification
Justification 2020 IRP Preferred Resource Strategy • Integrated Resource Plan (IRP) - Preferred Resource Strategy (PRS) • Market indicators suggested competitive pricing for renewables • Competition for preferred sites • Corporate renewable goals – systemwide – Carbon neutral by 2027 – 100% clean el
Slide 19: 2020 Avista Renewable RFP Cross-Departmental Review
Cross-Departmental Review Transmission • Power Supply – Wholesale marketing, resource Power Supply Legal planning, real-time, traders, credit and resource optimization • Transmission 2020 Avista • Regulatory Renewable RFP • Insurance/Risk Corporate Insurance Risk Communications • Corporate Communica
Slide 20: New Elements of 2020 RFP
New Elements of 2020 RFP • New and existing projects were eligible to bid – New renewable resources – Nonemitting electric generation (existing) • Updated evaluation methodology criteria – Risk Management, Net Price, Price Risk, Electric Factors, Environmental – Added Community Impact • Avista servi
Slide 21: RFP Communications
RFP Communications • Published on www.myavista.com • Press Release – Local media contacts – GlobeNewswire distribution to over 600 national outlets 5
Slide 22: Renewable Generation Need
Renewable Generation Need • RFP for up to 300 MW renewables 2020 Avista • 2020 IRP’s PRS model Renewable Wind – 2022 Montana wind – 100 MW RFP – 2022-2023 NW wind – 200 MW • Anticipated proposals – mix of wind/solar/storage Solar Storage Repowering 6
Slide 23: Bids Received July 22, 2020
Bids Received July 22, 2020 • 42 projects • 25 developers • 27 solar (many with battery options) • 13 wind (some with battery option) • 1 hydro • 1 biomass 7
Slide 24: RFP Initial Reactions
RFP Initial Reactions • Good selection of shovel ready and existing projects • Good geographic distribution – Projects throughout Northwest with majority in Washington, then Montana, Idaho and Oregon • Prices were higher than 2018 RFP – Sunsetting PTC – Increased construction costs • Multiple capaci
Slide 25: 2020 Avista Renewable RFP Evaluation Methodology
2020 Avista Renewable RFP Evaluation Methodology General Qualifications Evaluation Criteria • Compatibility with resource need • Risk Management - Credit and Developer • Site control Experience • Financial plan to bring project to • Net Price - Nominal levelized cost / MWh completion • Price Risk -
Slide 26: 2020 Target Schedule (and Milestones Completed)
2020 Target Schedule (and Milestones Completed) June 26, 2020 – RFP Released July 22, 2020 – Preliminary Information Due July 31, 2020 – Short-list identified and notified (along with other bidders) August 21, 2020 – Detailed proposals received from short-list October 16, 2020 – Final bidd
Slide 27: 2020 RFP Next Steps
2020 RFP Next Steps • Continue to address specific attributes within proposal(s) • Contract negotiations with successful project(s) • Continue internal review to make a final determination 11
Slide 28: PRiSM Model Overview
PRiSM Model Overview James Gall, Electric IRP Manager Fourth Technical Advisory Committee Meeting November 17, 2020
Slide 29: What is PRiSM?
What is PRiSM? • Preferred Resource Strategy Model • Mixed Integer Program (MIP) used to select new resources to meet resource needs of our customers The user interface The solver interface The solver 2
Slide 30: New PRiSM Features for 2021 IRP
New PRiSM Features for 2021 IRP • Significant changes were made to this IRP’s model due to individual state policies. – Model purpose: Same as before with additional constraints and options. – New Constraints: Must meet individual state L&R balance requirements and clean energy goals. – New Options:
Slide 31: Objective Function
Objective Function Intro to linear programing: https://www.youtube.com/watch?v=Uo6aRV-mbeg Minimize: (WA “Societal” NPV2022-45) + (ID NPV2022-45) Where: WA NPV2022-45 = Market Value of Load + Existing & Future Resource Cost/Operating Margin + Social Cost of Carbon + EE TRC ID NPV2022-45 = Market Val
Slide 32: Optimized Cost vs. Actual Costs
Optimized Cost vs. Actual Costs • Objective function includes social • Actual costs illustrate expected cost costs that are not part of utility ratepayers will pay. revenue requirement. • Estimate annual revenue • This is used for resource requirements. optimization only. • Estimate average rates. •
Slide 33: Aurora Integration
Aurora Integration • Aurora’s price forecast and • Energy efficiency load shapes are resource dispatch are inputs into marked to market and used for the PRiSM. energy value of these programs. • Each supply resource’s • Demand response options are not operations is included by iteration. modeled in A
Slide 34: Thermal Resources
Thermal Resources • Model may retain or exclude specific resources in any year. – Retirements are for both states (except Colstrip). – No re-allocation of existing resources between states. • Includes major future capital spend for continued operation along with O&M costs. • Resource costs and benef
Slide 35: Hydro Resources
Hydro Resources • Available for full length of study. • Post Falls assumes rebuild in 2025 (found cost effective in 2021 IRP). • Energy, capacity, and clean energy attributes split between states using PT ratio (65% WA/35% ID). 8
Slide 36: Other Existing Resources
Other Existing “Resources” • PURPA – CETA has provision for in-state PURPA generation reducing clean energy obligation. – For modelling purposes, generation is allocated to each state it qualifies under PURPA. • Other Wholesale Contracts – Current PPAs are allocated to each state using PT ratio. – E
Slide 37: Energy Efficiency
Energy Efficiency Washington Idaho • AEG provides EE potential by year and program • AEG provides EE potential by year and program – Winter peak savings – Winter peak savings – Summer peak savings – Summer peak savings – Annual average savings – Annual average savings • Electrical savings are grosse
Slide 38: Demand Response
Demand Response • Programs available in each state determined by AEG. • AEG estimated capital amortized over 5 years and a levelized cost is created by combining the O&M costs. • Projects must ramp in over time (except large industrial). – 25 MW of industrial DR for Washington • Water heating is dif
Slide 39: Supply-Side Options
Supply-Side Options • Uses levelized fixed and variable costs for potentially owned resources (i.e. natural gas, storage). • Uses PPA $/MWh or $/kW-yr costs for resources. • All generation costs are available on the IRP website. • Washington PPA options includes rate of return for clean resources. •
Slide 40: Clean Energy Goals
Clean Energy Goals • Washington • Idaho – 100% clean energy (carbon neutral) by 2030 – No clean energy requirement. – 100% clean energy by 2045 – Idaho is allowed to sell REC’s to Washington • MAJOR ASSUMPTIONS: LSE. – By 2030, Washington’s clean energy must equal – Other REC sales to other parties
Slide 41: Greenhouse Gas Emissions
Greenhouse Gas Emissions • The model estimates the GHG emissions for thermal resource dispatch. – Market purchase/sale effects are estimated using the regional average emission rate. – Storage resources include a market based GHG adder. • Societal emissions saved from Energy Efficiency using an incr
Slide 42: Social Cost of Carbon or Social Cost of Greenhouse Gas
Social Cost of Carbon or Social Cost of Greenhouse Gas Washington Idaho – Costs are included for resource dispatch of – No direct cost of GHG is included. new thermal & storage options. – Objective function is 65% Washington Cost- – Cost are also included for existing natural therefore existing reso
Slide 43: Transmission
Transmission • Resources have either a capital investment or a wheeling charge. – Capital investments are based on the transmission cost estimates from the September 2020 TAC 3 meeting. • Resource options in the Rathdrum, Idaho area are a challenge. – Approximately 100 MW can be added without signif
Slide 44: Resource Adequacy Check
Resource Adequacy Check • To the furthest extent possible, portfolios will be studied for resource adequacy for 2025, 2030, and 2040. – Each study takes 3 days to complete; Avista has only 2 machines capable of this work. • If a portfolio fails the adequacy test- additional capacity will be required
Slide 45: Equity Provisions
Equity Provisions • Avista previously identified potential areas within its system qualifying for VP/HIC status, although final determination is still ongoing. • A baseline analysis for cost and reliability/resilience has been completed. • Avista is developing an Equity Advisory Group (EAG). – EAG w
Slide 46: Least Reasonable Cost Strategy & Baseline Analysis
DRAFT Least “Reasonable” Cost Strategy & Baseline Analysis “Not Preferred Resource Strategy Yet” James Gall, Electric IRP Manager Fourth Technical Advisory Committee Meeting November 17, 2020
Slide 47: Safe Harbor Statement
DRAFT Safe Harbor Statement This document contains forward-looking statements. Such statements are subject to a variety of risks, uncertainties and other factors, most of which are beyond the Company’s control, and many of which could have a significant impact on the Company’s operations, results of
Slide 48: Other Caveats
DRAFT Other Caveats • Clean Energy Transformation Act (CETA) rules and requirements are not complete. – This is Avista’s best estimate of known requirements. • Avista is negotiating with the renewable Request for Proposals (RFP) shortlist bidders – This may change the results of the resource plan du
Slide 49: Energy Efficiency Results
DRAFT Energy Efficiency Results Washington Energy Idaho Energy 1,000.0 1,000.0 900.0 2020 IRP 900.0 2020 IRP 2021 IRP 800.0 2021 IRP 800.0 700.0 700.0 600.0 600.0 NOTE: GWh GWh 500.0 500.0 400.0 300.0 400.0 300.0 Energy Efficiency results 200.0 100.0 200.0 100.0 do not materially impact - - supply r
Slide 50: Cumulative Energy Efficiency End Use Results (GWh)
DRAFT Cumulative Energy Efficiency End Use Results (GWh) 2023 2031 2045 WA ID WA ID WA ID Appliances 0.7 0.1 6.6 0.8 15.6 2.7 Cooling 6.4 0.5 41.7 2.8 61.2 7.0 Electronics 1.1 0.2 15.2 4.8 27.1 9.3 Exterior Lighting 4.3 1.4 24.8 7.8 37.2 14.3 Food Preparation 0.1 0.0 2.2 0.4 5.9 0.9 Interior Lightin
Slide 51: Cumulative Energy Efficiency Segment Results (GWh)
DRAFT Cumulative Energy Efficiency Segment Results (GWh) 2023 2031 2045 WA ID WA ID WA ID College 2.7 0.7 13.8 4.2 19.5 7.5 Grocery 6.8 0.2 47.6 1.4 56.6 1.7 Health 2.7 0.9 14.5 4.7 23.0 8.1 Industrial 12.0 7.9 62.5 41.1 91.4 61.1 Large Office 6.6 1.3 43.6 8.8 67.5 16.5 Lodging 1.4 0.6 8.9 2.9 13.2
Slide 52: Higher Washington Energy Efficiency Goals
DRAFT Higher Washington Energy Efficiency Goals More Aggressive Ramp Rates & Higher Avoided Costs 600 534 Based on Based on Cumulative Savings Biennial Conservation Target (MWh) 500 478 2021 IRP 2020 IRP Pro Rata 10 CPA Pro-Rata Share 106,740 72,338 417 Distribution and Street Light Efficiency 219 5
Slide 53: Stacked 20-Year Levelized Energy Efficiency Avoided Cost (WA)
DRAFT Stacked 20-Year Levelized Energy Efficiency Avoided Cost (WA) Energy Value Capacity Value $140 $120 Preference, $120 $9.94 $100 Losses, Levelized 20yr $/kW-yr $5.39 Levelized 20yr $/MWh $100 SCC, $45.61 $80 T&D, $25.38 $80 Preference, $4.88 $60 Non-Energy, $60 $22.50 Losses, $2.64 $40 Capacity
Slide 54: Stacked 20-Year Levelized Energy Efficiency Avoided Cost (ID)
DRAFT Stacked 20-Year Levelized Energy Efficiency Avoided Cost (ID) Energy Value Capacity Value $140 $120 $120 $100 Losses, Levelized 20yr $/kW-yr Levelized 20yr $/MWh $5.39 $100 $80 T&D, $25.38 $80 $60 $60 $40 Capacity, $40 $68.60 Losses, $2.64 $20 $20 Energy, $25.86 $0 $0 9
Slide 55: Demand Response
DRAFT Demand Response Program Washington Idaho Time of Use Rates 2 MW (2024) 2 MW (2030) Variable Peak Pricing 7 MW (2024) 6 MW (2030) Large C&I Program 25 MW (2027) n/a DLC Smart Thermostats 7 MW (2030) n/a Third Party Contracts 15 MW (2031) n/a Behavioral Programs 1 MW (2039) n/a Total 56 MW 8 MW
Slide 56: 2022-2025 Supply Side Resource Changes
DRAFT 2022-2025 Supply Side Resource Changes 2022: Economic to exit out of Colstrip 3 & 4 (Both) 2023: 100 MW of Montana Wind (WA) 2024: 50 MW of Montana Wind (WA) 2025: No Action NOTE: Renewable RFP may change this strategy 11
Slide 57: 2026-2029 Supply Side Resource Changes
DRAFT 2026-2029 Supply Side Resource Changes 2026: 50 MW Montana Wind (WA) 48 MW NG SCCT (Both) Lancaster CCCT contract ends (Both) 2026/27: 84 MW NG SCCT (ID) 84 MW NG SCCT (Both) 12 MW Upgrade Kettle Falls (Both) 2028: 50 MW Montana Wind (WA) 2029: 50 MW Solar + 50 MW 4-Hour Storage (Both) 12 NOTE
Slide 58: 2030-2033 Supply Side Resource Changes
DRAFT 2030-2033 Supply Side Resource Changes 2030: No Action 2031: 75 MW Hydro Contract Renewal (WA) 2032: No Action 2033: No Action NOTE: Renewable RFP may change this strategy 13
Slide 59: 2034-2037 Supply Side Resource Changes
DRAFT 2034-2037 Supply Side Resource Changes 2034: 5 MW Rathdrum CT Upgrade (Both) 2035: 50 MW Solar + 50 MW 4-Hour Storage (Both) Northeast Retires (Both) 2036: 50 MW Hydrogen SCCT (WA) 55 MW NG SCCT (ID) 2037: No Action 14
Slide 60: 2038-2045 Supply Side Resource Changes
DRAFT 2038-2045 Supply Side Resource Changes 2038: 50 MW Montana Wind (WA) 2039: No Action 2040: 50 MW Solar + 50 MW 4-Hour Storage (Both) 2041: 50 MW Solar + 50 MW 4-Hour Storage (WA) 50 MW Montana Wind (WA) Boulder Park Retires (Both) 2042: 50 MW Montana Wind (WA) 50 MW Solar + 50 MW 4-Hour Storag
Slide 61: Least Reasonable Cost Resource Selection (MW)
DRAFT Least Reasonable Cost Resource Selection (MW) Nameplate MW 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 Shared System Resource NG CT 0 0 0 0 48 84 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Solar 0 0 0 0 0 0 0 50 0 0 0 0 0 50
Slide 62: Clean Energy Share (aMW)
DRAFT Clean Energy Share (aMW) Washington 1,200 Existing Clean Resources RECs New Clean Resources Net Sales System 1,000 1,200 Existing Clean Resources RECs New Clean Resources Net Sales Average Megawatts 800 1,000 Average Megawatts 600 800 400 600 200 400 - 2022 2023 2024 2025 2026 2027 2028 2029 2
Slide 63: Annual Average Least Reasonable Cost Rate Forecast
DRAFT Annual Average Least Reasonable Cost Rate Forecast 0.18 0.17 WA ID 0.16 0.14 0.13 0.15 Dollars per KWh 0.12 0.10 0.10 0.11 0.08 0.09 0.06 0.04 0.02 0.00 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 NOTE: Estimated rates
Slide 64: Greenhouse Gas Forecast
DRAFT Greenhouse Gas Forecast 3.5 3.0 2.5 Current Resources New Resources Net Market Transactions Million Metric Tons 2.0 Upstream/Construction/Operations Net Emissions 2019 Generated Emissions 1.5 1.0 0.5 0.0 -0.5 -1.0 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037
Slide 65: Baseline Analysis
DRAFT Baseline Analysis 1. Least Reasonable Cost Strategy: Includes all requirements 2. Baseline Portfolio 1: Excludes CETA’s 2030 and 2045 goals – Used for incremental cost calculation 3. Baseline Portfolio 2: Baseline Portfolio 1 + removal of SCC – Energy Efficiency held constant from LCS – Used t
Slide 66: Resource Mix Summary
1. LRCS 2. Baseline 1 3. Baseline 2 4. Baseline 3 Resource Shared System Resource NG CT 132 132 479 0 DRAFT Solar 300 150 150 0 Mix Storage Added to Solar Wind 300 0 150 0 150 0 0 0 Summary Storage Hydrogen Other- (Clean Capacity) 0 0 0 33 0 0 0 0 0 0 0 0 Thermal Upgrade 17 17 17 0 Hydro 0 0 75 0 Wa
Slide 67: Cost Comparison of Baseline Scenarios
Cost Comparison of Baseline Scenarios DRAFT Washington Idaho $800 $730 $705 $702 $700 $681 Levelized Revenue Requirement $600 $500 $380 $384 $381 $368 $400 $300 $200 $100 $0 1- LRCS 2- Baseline 1 3- Baseline 2 4- Baseline 3 Cost difference is cost of clean energy targets Cost difference is cost of c
Slide 68: Washington CETA Cost Cap Analysis
DRAFT Washington CETA Cost Cap Analysis (assumes current methodology) Washington Incremental Cost Calculation 2022 2023 2024 2025 Revenue Requirement w/ SCC 651 669 693 698 Baseline (Total Revenue Requirement Plus SCC) 649 657 670 675 Annual Delta 2 12 23 23 Incremental cost Percent Change 0% 2% 3%
Slide 69: New Supply-Side Resource Avoided Costs
DRAFT New Supply-Side Resource Avoided Costs Clean Energy Capacity Flat On-Peak Off-Peak Premium Premium Year ($/MWh) ($/MWh) ($/MWh) ($/MWh) ($/kW-Yr) 2022 $20.37 $21.67 $18.63 $0.00 $0.00 2023 $18.70 $19.22 $18.01 $17.32 $0.00 2024 $18.73 $19.04 $18.32 $17.66 $0.00 2025 $20.00 $20.05 $19.92 $18.02
Slide 70: Least Reasonable Cost Strategy & Baseline Analysis
DRAFT Least “Reasonable” Cost Strategy & Baseline Analysis “Not Preferred Resource Strategy Yet” James Gall, Electric IRP Manager Fourth Technical Advisory Committee Meeting November 17, 2020
Slide 71: Safe Harbor Statement
DRAFT Safe Harbor Statement This document contains forward-looking statements. Such statements are subject to a variety of risks, uncertainties and other factors, most of which are beyond the Company’s control, and many of which could have a significant impact on the Company’s operations, results of
Slide 72: Portfolio Scenarios - 2021 IRP
DRAFT Portfolio Scenarios- 2021 IRP 1. Preferred Resource Strategy 2. Baseline Portfolio 1 (No CETA renewable targets) 3. Baseline Portfolio 2 (No CETA renewable targets/SCC) Only black font 4. Baseline Portfolio 3 (No additions) scenarios are shown 5. Clean Resource Plan (100% Portfolio net clean b
Slide 73: Scenario Descriptions
DRAFT Scenario Descriptions 1. Least Reasonable Cost Strategy: Includes all requirements 2. Baseline Portfolio 1: Excludes CETA’s 2030 and 2045 goals – Used for incremental cost calculation 3. Baseline Portfolio 2: Baseline Portfolio 1 + removal of SCC – Energy Efficiency held constant from LCS 4. B
Slide 74: Scenario Descriptions Continued
DRAFT Scenario Descriptions Continued 15. Least Cost Plan- with 2 time SCC prices – Double of Social Cost of Carbon charge for Washington Only 16. Colstrip serves Idaho customers through 2025 – Colstrip obligated to run through 2025 in both states 17. Colstrip serves Idaho customers through 2035 – C
Slide 75: Portfolio Sensitivities
DRAFT Portfolio Sensitivities • Portfolio scenarios will be tested with alternative price forecasts – High Natural Gas Prices – Low Natural Gas Prices – Social Cost of Carbon “Tax” – Climate Shift • Likely available for draft document, but not TAC presentations 6
Slide 76: Scenario Cumulative Resource Selection
DRAFT Scenario Cumulative Resource Selection 1. LRCS 2. Baseline 3. Baseline 4. Baseline 5. CRS 6. CRS 7. SCC ID 15- LRCS 16- Colstrip 17- Colstrip 18- Colstrip 1 2 3 (2027) (2045) 2x SCC 2025 2035 2045 Shared System Resource NG CT 132 132 479 0 0 0 48 0 132 132 132 Solar 300 150 150 0 650 670 200 1
Slide 77: Existing Resource Exits
DRAFT Existing Resource “Exits” 6- Clean 5- Clean Resource 2- Baseline 3- Baseline 4- Baseline Resource Strategy 7- SCC 16- Colstrip 17- Colstrip 18- Colstrip 1- LRCS 1 2 3 w/ EE Plan (2027) (2045) Idaho 15- 2x SCC 2025 2035 2045 Coyote Springs 2 - - - - - 2044 - 2022 - - - Lancaster 2026 2026 2026
Slide 78: 2022-45 Levelized Revenue Requirement
DRAFT 2022-45 Levelized Revenue Requirement Washington Idaho $900 $800 $778 $736 $748 $732 $732 $733 $733 $730 Millions $705 $702 $681 $700 $600 $500 $410 $411 $380 $384 $381 $381 $393 $393 $381 $381 $400 $368 $300 $200 $100 $0 1- LRCS 2- Baseline 3- Baseline 4- Baseline 5- CRS 6- CRS 7- LRCS 15- LR
Slide 79: Rate Estimates (Average Annual)
10 $/kWh 0.000 0.050 0.100 0.150 0.200 0.250 1- LRCS 2- Baseline WA-2030 1 3- Baseline 2 ID- 2030 4- Baseline 3 WA- 2045 5- CRS (2027) 6- CRS ID- 2045 (2045) 7- LRCS Rate Estimates (Average Annual) (ID SCC) 15- LRCS 2x SCC 16- Colstrip 2025 17- Colstrip 2035 18- Colstrip 2045 DRAFT
Slide 80: Annual Greenhouse Gas Emission
DRAFT Annual Greenhouse Gas Emission Avista Dispatch & Storage Purchases 4.0 1- LRCS 2- Baseline 1 3- Baseline 2 4- Baseline 3 5- CRS (2027) 6- CRS (2045) 7- LRCS (ID SCC) 15- LRCS 2x SCC 16- Colstrip 2025 3.5 17- Colstrip 2035 18- Colstrip 2045 2019 Gross Emissions 3.0 Millions of Metric Tons 2.5 2
Slide 81: Cost vs. GHG Tradeoffs
DRAFT Cost vs. GHG Tradeoffs Change in Levelized Cost vs. Change in Levelized Net Emissions $80 Change in Levelized Cost From LRCS (millions) $60 15- LRCS 2x SCC 6- CRS (2045) $40 5- CRS (2027) 16- Colstrip 2025 $20 17- Colstrip 2035 7- SCC Idaho $0 1- LRCS 18- Colstrip 2045 2- Baseline 1 -$20 -$40
Slide 82: 2030 Risk Analysis
DRAFT 2030 Risk Analysis Measures 2030 standard deviation of “modeled” power cost compared to levelized cost $60 4- Baseline 3 $50 2- Baseline 1 3- Baseline 2 2030 Stdev (millions) $40 1- LRCS 15- LRCS 2x SCC 16- Colstrip 2025 7- SCC Idaho $30 17- Colstrip 2035 6- CRS (2045) 18- Colstrip 2045 $20 5-
Slide 83: 2045 Risk Analysis
DRAFT 2045 Risk Analysis Measures 2045 standard deviation of “modeled” power cost compared to levelized cost $160 $140 4- Baseline 3 $120 2045 Stdev (millions) 2- Baseline 1 $100 3- Baseline 2 $80 6- CRS (2045) 1- LRCS 7- SCC Idaho, 57 $60 17- Colstrip 2035 16- Colstrip 2025 15- LRCS 2x SCC $40 18-
Slide 84: 2045 Upper Tail Risk Analysis
DRAFT 2045 Upper Tail Risk Analysis 95th percentile power cost minus mean power cost compared to levelized cost $300 $250 4- Baseline 3 2045 Tail Risk (millions) $200 2- Baseline 1 3- Baseline 2 $150 17- Colstrip 2035 7- SCC Idaho 15- LRCS 2x SCC $100 1- LRCS 16- Colstrip 2025 6- CRS (2045) $50 5- C
Slide 85: Next Steps
Next Steps • Post PRiSM model to website • Complete other scenarios and sensitivities • Begin reliability studies • Update PRiSM model for any modifications • Select Preferred Resource Strategy • Re-run scenarios and sensitivities • Continue reliability studies if necessary 16