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Energizing the Northwest Today and Tomorrow September 28, 2004

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Title: Energizing the Northwest Today and Tomorrow September 28, 2004


1
Energizing the NorthwestToday and Tomorrow
September 28, 2004
Joseph Desmond Deputy Secretary of Energy State
of California
2
Californias Energy Plan
  • Resource Adequacy
  • New Generation
  • Repower/retrofit Existing Plants
  • Transmission
  • Wholesale Market Reform/Competitive Procurement
  • Rate Relief
  • Increasing Natural Gas Supplies
  • Retail Choice (Core/Non-core)
  • Renewable Energy
  • Energy Efficiency

3
(1) Resource Adequacy
  • Require minimum 15 reserves margins by all
    sellers of electricity to avoid energy shortages.
  • Governor called upon CPUC in April to accelerate
    implementation by two years (from 2008 to 2006)
  • CPUC responded with new requirements adopting the
    Governors plan
  • CPUC now implementing details of resource
    adequacy rules
  • Rules account for all required generation and
    demand side resources to meet maximum demand
  • Other Administration efforts earlier this summer
    secured an additional 320 MW in 90 days Energy
    task force working to ensure short term supplies
    available for summer 2005 major new generation
    projects approved by CPUC

4
(2) Transmission
  • Pursue all opportunities to enhance and expand
    the transmission system to reduce congestion
    costs, improve reliability and access new
    generation resources.
  • Streamline transmission project siting and
    approval through a transmission Executive Order
  • CPR recommendation - Move responsibility for
    transmission siting from CPUC to the CEC
  • Implement policies and rules to enable access to
    distant renewable resources (both in and out of
    state)
  • Transmission watch list the top priorities
  • Other More than 2700 MW of new transmission
    capacity is being added in 2004

5
(3) Wholesale Energy Procurement
  • An open, competitive procurement process ensures
    the best possible deal for ratepayers in terms of
    price, risk, reliability and environmental
    impact.
  • Procurement is the means by which a utility
    buys the power it needs to serve its customers.
  • Competitive procurement ensures that utilities
    will purchase the lowest cost power available in
    the market. Long-term contracts result in
    reduced reliability on the spot market and stable
    prices.
  • Fixes one of the fundamental flaws that
    contributed to the Energy Crisis (ie. the
    prohibition of long-term contracts)
  • Plan prioritizes energy efficiency, demand
    response and renewable resources before fossil
    generation procurement
  • Cost Recovery - By following an approved
    procurement process, utilities are assured a
    return on their investment
  • CPUC is implementing rules final Commission
    decision expected by December, 2004

6
(4) Rate Relief
  • Every effort is being made to reduce energy costs
    for all California consumers
  • FERC refund settlement being aggressively
    pursued recent favorable court ruling increases
    likelihood of higher refunds
  • DWR contracts are being renegotiated to lower
    costs new contract terms provide greater
    flexibility and savings
  • CPUC directed to implement fair and equitable
    rate design

7
(5) Increasing Natural Gas Supplies
  • Ensure adequate supplies of competitively priced
    natural gas by pursuing increased in-state gas
    production, pipeline expansion and permitting of
    new liquefied natural gas (LNG) import terminals
  • Interstate LNG Working group formed coordinating
    review efforts across agencies for LNG permit
    applications
  • Community education and outreach effort on LNG
    safety and environmental issues being rolled out
  • Working with PUC to ensure Baja LNG will flow to
    Ca

8
(6) Retail Choice (Direct Access)
  • Support large customers right to choose their
    energy supplier
  • Competition lowers prices drives innovation
    improves customer service
  • Prerequisites No cost-shifting between small and
    large users no stranded investment
  • Reestablishment of Direct Access requires
    statutory repeal of ban
  • Governor offered amendment to AB2006 that would
    enable Direct Access
  • Will continue to work with legislature to repeal
    the ban on Direct Access.

9
(7) Renewable Energy
  • Implement policies and programs to achieve a 20
    renewable energy mix by 2010
  • Governor called on PUC to accelerate 20
    renewable goal to 2010 rather than 2017. PUC
    complied and has established as new State policy
  • Million solar system initiative launched for
    residential and commercial photovoltaic systems
  • Western Governors Association resolution calls
    for development of 30,000 MW of new, clean energy
    sources western renewable tracking system
    (WREGIS) under development by Energy Commission
  • Other New CPUC Renewables Advisor position
    created to manage progress on renewable goals

10
(8) Energy Efficiency
  • Pursue all cost-effective energy efficiency
    opportunities
  • Governor called for utility procurement plans to
    prioritize energy efficiency before purchasing
    new fossil fuel power plants
  • A total of 656 million spent on energy
    efficiency in 2003 amount the IOUs.
  • Green Buildings Executive Order (coming soon)
    will have State lead by example on energy
    efficiency
  • Western Governors Association resolution calls
    for 20 improvement in efficiency by 2020
  • Developing new Zero-Energy New Home (ZENH)
    initiative in concert solar systems
  • Other New Flex Your Power Now! campaign
    launched new building codes (Title 24) and new
    appliance standards implemented

11
Additional Energy Priorities
  • FERC Refund Settlement
  • DWR Contract Renegotiation
  • Energy Agency Consolidation
  • Dynamic Pricing/Advanced Metering
  • Distributed Energy
  • Research Development
  • Updating bi-annual Integrated Energy Policy
    Report (IEPR)
  • Aging Power Plants

12
Statewide Outlook
13
Electricity Demand Trends
2
14
Statewide OutlookAdjusted for increased Demand
This Outlook does not replace CEC staffs
previous Outlook. A new Demand Forecast will be
completed for the 2005 Integrated Energy
Policy Report and published in Spring 2005.
15
Statewide Operating ReserveNot including
emergency response and accelerated programs
This Outlook does not replace CEC staffs
previous Outlook. A new Demand Forecast will be
completed for the 2005 Integrated Energy
Policy Report and published in Spring 2005.
16
Statewide Operating ReserveIncluding emergency
response and accelerated programs
This Outlook does not replace CEC staffs
previous Outlook. A new Demand Forecast will be
completed for the 2005 Integrated Energy
Policy Report and published in Spring 2005.
17
Summer Peak Day OverviewPeak Demand and
Available Resources (Preliminary)
  • Other 9/7/04 Details
  • Interruptions included 200 MW of CPA Load
    Response Program and 30 MW of SDGE Demand
    Response programs.
  • Intra-zonal Congestion during hour of peak
    1,275 MW
  • Northern Imports (including DC) 5,819 MW COI
    fully loaded
  • Southwest Imports 3,041 MW Congestion limited
    further imports.
  • San Diego experienced new all time peak of 3,977
    MW.

Mary Jo Thomas, OE
18
Total Electricity Use per Capita 1960-2000
19
Emerging Renewables Programs Installed Solar
Inventory
20
Natural Gas Consumption
21
Energy Efficiency
22
Efficiency Program Impact
23
United States Refrigerator Use v. Time Annual
drop from 1974 to 2001 5 per year
2000
25
1800
1600
20
1978 Cal Standard
1400
Refrigerator Size
1980 Cal Standard
(cubic feet)
1200
15
Average Energy Use per Unit Sold (kWh per year)
1987 Cal Standard
Refrigerator volume (cubic feet)
1000
800
10
1990 Federal
Standard
600
Energy Use per Unit
1993 Federal
400
5
Standard
2001 Federal
200
Standard
0
0
1947
1949
1951
1953
1955
1957
1959
1961
1963
1965
1967
1969
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
24
Source David Goldstein
25
Impact of Standards on Efficiency of 3 Appliances
75
60
25
Source S. Nadel, ACEEE, in ECEEE 2003 Summer
Study, www.eceee.org
26
(No Transcript)
27
GWH Impacts from Programs Begun Prior to 2001
40,000
14 of Annual Use in California in 2001
35,000
30,000
25,000
Utility Programs at a cost of 1 of Electric
Bill
GWH
20,000
15,000
10,000
Building Standards
5,000
Appliance Standards
0
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Public Interest Energy Strategies CEC 100-03-12F
28
Transmission
29
NTACNorthwest Transmission Assessment Committee
  • Mission
  • NTAC will be the open forum to address forward
    looking planning and development for a robust and
    cost effective NWPP area transmission system

30
Current Status of NTAC Initiative
  • Overall NTAC technical analysis effort is under
    way
  • Alberta ISO has indicated that approximately 1500
    MW of Tar Sands capacity will be available to
    transfer to California
  • ISO has initiated the Canada California study
    effort to assess AC and DC transmission
    alternatives between Canada and California
  • While NTAC is not performing economic analysis at
    this time, at the ISOs request the RMATS study
    team has agreed to provide the ISO with an RMATS
    type economic analysis for a Canada California
    transmission alternative
  • NTAC information can be found at the following
    web site
  • http//www.nwpp.org/ntac/

31
CAISO Is Coordinating This Effort
32
RMATS - Recommendation 1 Transmission Projects
33
RMATS - Recommendation 2 Transmission Projects
Longer-term export options
Bell
Noxon
Great Falls
Taft
Ashe
Hot Springs
Broadview
Colstrip
Missoula
Ringling
Grizzly
This recommendation requires two 500 kV lines for
export
Midpoint
500 kV
Kinport
Ant Mine
345 kV
Dave Johnson
Option 1
Borah
Jim Bridger
LRS
Inc. DC
Ben Lomond
Naughton
Miners
Table Mtn.
Cheyenne Tap
Consistent with Rec 1
IPP
Mona
Ault
Option 2
Emery
Green Valley
Grand Junction
Tesla
Red Butte
Crystal
Option 3
Added Phase Shifter
Market Place
Adelanto
Option 4
Options 2-4
Option 1 Only
34
Canada California Transmission Alternative
Alberta Tar Sands
Grizzly
AC or DC 500kV Line
Tesla
Midway
Vincent
35
Looking to the Future
36
Looking to the Future
  • California is not an island. We are part of the
    Western Grid. Policies will explicitly
    incorporate a regional perspective.
  • We appreciate the energy imports and support from
    our neighboring states
  • CA is not out of the woods, but has turned the
    corner
  • The Future looks bright
  • Energy efficiency, renewables and demand response
  • Clean energy technologies
  • Improved reliability
  • Competitively priced energy

37
Energy Efficiency as an Energy Resource
California and the Pacific Northwest Have
Aggressive Efficiency Programs That Are Meeting a
Substantial Portion of Their Demand
PNW 12 Energy Savings
CA 20 Peak Energy Savings
10,000 MW Avoided in Last 25 Years
2,600 aMW Avoided in Last 25 Years
Source Northwest Power and Conservation Council,
California Energy Commission and California State
and Consumer Services Agency
38
Resurgence of Energy Efficiency
By 2004, Utilities in Many States Are Again
Running Various Energy Efficiency Programs
Sources ACEEE and NRDC
39
Available Reports/Program Details
  • Electric Industry CPUC Information and Programs
  • http//www.cpuc.ca.gov/static/industry/electric
  • CECs Integrated Energy Policy Report
    http//www.energy.ca.gov/energypolicy/index.html
  • State of California Energy Action Plan
    http//www.energy.ca.gov/2003_energy_action_plan/i
    ndex.html
  • CECs Renewables Program http//www.energy.ca.gov/
    renewables/index.html
  • CECs Public Interest Energy Research
    http//www.energy.ca.gov/research/index.html
  • CECs Energy Efficiency Rebates and Demand
    Reduction http//www.consumerenergycenter.org/reba
    te/index.php
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