Value of Distributed Solar in the Northwest PNUCC Board of Directors - - PowerPoint PPT Presentation

February 2015

Value of Distributed Solar in the Northwest

PNUCC Board of Directors

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February 2015

Acknowledgments Acknowledgments

Clint Kalich Avista Jimmy Lindsay Portland General Electric Gordon Matthews BPA Tomás Morrissey PNUCC (lead author) T T l d Cl k PUD Eli b th H P t S d E Terry Toland Clark PUD Elizabeth Hossner Puget Sound Energy Erin Erben EWEB Phillip Popoff Puget Sound Energy Adam Rue EWEB Michael Jones Seattle City Light Phil DeVol Idaho Power Michael Little Seattle City Light Mark Stokes Idaho Power Zac Yanez Snohomish PUD Mark Stokes Idaho Power Zac Yanez Snohomish PUD Sima Beitinjaneh Portland General Electric Dave Warren WAPUDA Stefan Brown Portland General Electric

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February 2015

Purpose of report Purpose of report

• Distributed solar growing in popularity

Distributed solar growing in popularity

• Add to the discussion of how to value the resource

Add to the discussion of how to value the resource

• Looks at value to utility – not cost to install or return
• Looks at value to utility – not cost to install or return
• n investment

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February 2015

Growing popularity

EIA – data for 2012 Lawrence Berkeley National Laboratory, 2014.

Growing popularity

2012 Installed Capacity (MW) Number of meters Idaho 2 349 Montana 4 1,010 Oregon 43 6,269 Washington 17 3,222 NW Total 66 10 850 NW Total 66 10,850 California 1,537 158,940 US Total 3,680 323,365 $10 $12 $14 ed watt $4 $6 $8 rs per installe

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$‐ $2 1998 2000 2002 2004 2006 2008 2010 2012 Dollar

February 2015

Every utility will see a different value Every utility will see a different value

• Geography
• Energy prices
• Timing of peak need
• Utility characteristics
• Utility characteristics

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Map from NREL

February 2015

Energy Energy

Time Market Price/MWh Energy Produced, MWh Value

• Estimated using hourly

solar shape and hourly 2015 Mid C k t

Price/MWh MWh 7:00 $27.43 0.01 $0.14 8:00 $31.28 0.19 $6.00 9:00 $32.45 0.39 $12.72 10:00 $36.52 0.55 $20.12

2015 Mid‐C market forecast

10:00 $36.52 0.55 $20.12 11:00 $41.35 0.65 $26.84 12:00 $37.19 0.69 $25.66 13:00 $38.05 0.69 $26.37 14:00 $40.36 0.67 $27.04

• Annual average of

$35/MWh

15:00 $42.75 0.59 $25.35 16:00 $43.39 0.47 $20.26 17:00 $43.21 0.29 $12.70 18:00 $42.63 0.11 $4.52 19:00 $40.65 0.00 $0.04 One day Total 5.3 MWh $207.76 July day average MWh value: $207.76/5.3 MWh = $39/MWh

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NREL PV Watts and NWPCC

February 2015

Peak capacity Peak capacity

• Some utilities will see a solar peak capacity value

Some utilities will see a solar peak capacity value

• Occurs if solar production and utility peak need

reliably overlap, and if the utility is capacity deficit y p, y p y

80% 40% 50% 60% 70% city factor 10% 20% 30% 40% Solar capac

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0% 1 3 5 7 9 11 13 15 17 19 21 23 Hour ending

February 2015

Estimating peak capacity value Estimating peak capacity value

• Value range of $0 to $28,000 per MW per year

Value range of $0 to $28,000 per MW per year

Plant type Frame w/oil backup Plant type Frame w/oil backup Capital cost per MW $910,200 Discount rate/weighted cost of capital 7.0% Fixed O&M cost per MW/y $16,300 p y , Unit lifespan, years 30 Forced outage rate 5.0% Line loss 7.5% Cost per MW/y $100,500 Solar peak capacity credit 28% Solar capacity value per MW/y $28,100

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February 2015

Peak capacity considerations Peak capacity considerations

• Many winter peaking

P k ith t l Peak net of solar shifts

y p g utilities may not see a value

1 575 1,600 W)

Peak without solar

• Peak shift may

reduce peak capacity

1 525 1,550 1,575 t of solar (MW

p p y value (chart)

1,475 1,500 1,525 mple load net No solar 110 MW DC 220 MW DC

• Solar could provide

hydro augmentation

1,450 , 16 17 18 19 20 Exa Hour ending

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Load data from BPA scaled down 5x Solar data from NREL PV Watts

• u e d g

February 2015

Other values Other values

• Line loss: $2 ‐ $3 per MWh

$ $ p

• Transmission wheeling: $0 to $6,900 per MW/y
• Renewable portfolio standard: $0 to $8 per MWh

p p

• Hedge: $0 to $2 per MWh
• Integration: ($1) to $0 per MWh
• Transmission capacity (not quantified)
• Distribution system (not quantified)
• Externalities (not quantified)
• Voltage control (not quantified)

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February 2015

A range of values A range of values

$80 $90 $60 $70 $80 Integration Hedge $40 $50 $

• llars/MWh

Hedge RPS Peak capacity $20 $30 D Wheeling Line loss E $10 $0 $10 Low High Energy

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‐$10

February 2015

Next steps Next steps

• Publicize report

Publicize report

• Consider expanding discussion on solar

Consider expanding discussion on solar

– Bring speakers to the Board? – Discuss at System Planning Committee? y g – Write a primer on solar?

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February 2015

Value, west of Cascades Value, west of Cascades

Oregon utility, west of Cascades, south facing Component 1 MW DC, yearly Per MWh Energy $32,100 to $36,100 $32 to $35 Line loss $2,400 to $2,700 $2 to $3 Wheeling $0 to $6 900 $0 to $7 Wheeling $0 to $6,900 $0 to $7 Peak capacity $0 to $28,100 $0 to $28 Renewable portfolio standard $0 to $7,900 $0 to $8 Hedge $0 to $2,000 $0 to $2 Integration ($1,000) to $0 ($1) to $0 Transmission capacity ‐ ‐ Distribution system ‐ ‐ Externalities Externalities ‐ ‐ Voltage control ‐ ‐ Total $33,500 to $83,800 $33 to $82

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February 2015

Value, east of Cascades Value, east of Cascades

Idaho utility, south facing C t 1 MW DC l P MWh Component 1 MW DC, yearly Per MWh Energy $43,000 to $48,500 $32 to $35 Line loss $3,200 to $3,600 $2 to $3 Wheeling $0 to $6,900 $0 to $5 Wheeling $0 to $6,900 $0 to $5 Peak capacity $0 to $28,100 $0 to $21 Renewable portfolio standard $0 to $6,800 $0 to $5 Hedge $0 to $2,700 $0 to $2 Integration ($1,400) to $0 ($1) to $0 Transmission capacity ‐ ‐ Distribution system ‐ ‐ Externalities Externalities ‐ ‐ Voltage control ‐ ‐ Total $44,900 to $96,700 $33 to $71

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