spp.org 1. final report: reliability and economic assessments stakeholder meeting december 1, 2008...
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SPP.org 1
Final Report:
Reliability and Economic
AssessmentsStakeholder Meeting
December 1, 2008
Austin, TX
SPP.org 3
Activities Completed Since Last Meeting
• Reliability Assessment
Finalize results for SPP QPR option
Tie back Study for ERCOT QPR option
Stability Analysis for SPP QPR option
• Economic Assessment
Economic projects identified
Cost/Benefit Analysis for Status Quo and Integrated case
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Transmission Upgrades: Reliability Upgrades and Economic Upgrades
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Reliability Study Cases
• Contingency analysis (N-1) for SPP-ETI system
More stringent reliability criteria in Western Region (N-1, G-1)
Monitored 69 kV and above
• Several potential thermal and voltage violations found
• SPP examined a set of reliability upgrades to mitigate these violations
Substation work at Orange County
Reconductor eight 138 kV lines in ETI area
Reconductor five 69 kV lines in ETI area
• High level planning estimate of projects required to meet SPP Criteria is $105 M
COTTONWOOD IN EASTERN INTERCONNECTION
Projects to meet SPP Criteria
New Orange County Substation work ($50 M)
138 kV and 69 kV Upgrades ($55 M)
Planned Known Projects
ETI Proposed Projects for 2012
Local Reliability projects for Western Region
Transmission Reliability projects from the 2007 approved STEP Plan
ETI Transmission Construction Plan
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Tie Back Study
• Objective of this study to evaluate reliability of SPP system under ERCOT QPR option
• Most of the tie-lines across LA-TX removed and loop backed
• DC ties at two locations considered
Hartburg (830 MW and 250 MW)
Quarry, Near Crockett (150 MW and 50 MW)
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Potential ETI-ERCOT Disconnection Points
Quarry
Newton Bulk
Leach
Hartburg
Sabine
To Big Three, Hollywood, Toomey
Orange
Bon WierDETAIL 1
DETAIL 2
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DETAIL 1
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DETAIL 2
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ETEC System Disconnection Points
X
Pineland- Bronson
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Tie Back Study : Study Results
• SPP Area were examined based on N-1 contingency analysis using SPP Criteria
• Four Key Transmission Projects were identified by SPP staff to meet the SPP reliability criteria for ERCOT QPR option
Upgrade Broken Bow – Bethel 138kV line
Upgrade Fisher Transformer (138/115kV)
Upgrade Toledo Bend – Hemphill 138kV Line
Acadiana Projects
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Estimated Cost for SPP Members under ERCOT QPR option
Direction is from ETI to SPP
Hartburg DC Tie
(830 MW) (250 MW)
Quarry DC Tie
150 MW $25 Million $31 Million
50 MW $25 Million $61 Million
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Stability Assessment
• Objective of this study is to evaluate stability of ETI under SPP QPR and ERCOT QPR options
• A consultant (Powertech) is performing this study
• Transient and Voltage Stability analyses being performed using Entergy and SPP Stability Criteria
• ETI system will be tested under various fault scenarios and transfers into ETI using projects identified for SPP QPR option
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Stability Assessment : Cont.
• Stability study models are prepared jointly by SPP and ETI staff and sent to Powertech
• Simulated critical N-1, G-1, and N-G-1 contingencies in ETI first-tier areas (both electrical and geographical areas in SPP and rest of Entergy)
• Preliminary results indicated no significant issues in ETI system
Results indicate that RMR Requirements can be reduced
• The final results are expected in first quarter of 2009
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Economic Upgrades
• Two Projects included as Economic Upgrades
Mt. Olive to Hartsburg series capacitor ($10 M)
Increased rating to 1,450 MW thus reducing significant constrained hours
Weber-Richard 500 kV line ($229 M)
Helped reduced congestion in Cottonwood area and RMR need in Sabine area along with other reliability upgrades
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Cost allocation of ETI Reliability projects
• Reliability projects are required solely to integrate ETI into SPP
• SPP policy is to allocate these costs to the local zone
Similar to current discussion with Nebraska entities
Consistent with treatment with Pre Base Plan funding
• ETI Benefits compared to full cost of Reliability Projects ($105 M)
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Cost allocation of ETI Economic Projects
• ETI Benefits compared to full cost of Economic Projects ($239 M)
• Economic Upgrades may be fully or partially funded by SPP pursuant to their Tariff provisions (i.e. Balanced Portfolio)
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Economic Assessment
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Key Market Assumptions – Status Quo Model
• SPP Market Assumptions
SPP modeled as Day 2 Market planned by SPP Cost Benefit Task Force
System wide unit commitment
System wide treatment of spinning reserve requirements
Security Constrained Unit Commitment and Economic Dispatch
SPP operates as a Single Balancing Authority
• Entergy (including ETI) Operating Assumptions
System wide unit commitment
Security Constrained Economic Dispatch
Reserve Requirements set and met on Entergy System wide basis
ETI RMR Requirement consistent with historical operation to address local voltage constraints
ETI and Entergy generation output consistent with historical operations
• Hurdle rates between SPP / other Regions and Entergy / other Regions
Dispatch hurdle 7 $/MWh (Entergy/SPP hurdle rate $14/MWh)
Commitment hurdle 25 $/MWh
Consistent with SPP Future Market Design Study assumptions
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Key Market Assumptions – ETI/SPP Integrated Model
• SPP Market Assumptions same as Status Quo model
• ETI is a Member of SPP
• ETI RMR Requirements are reduced due to Reliability and Economic Transmission upgrades
Consistent with preliminary stability analysis results
Thermal constraints continue to be identified via Security Constrained Economic Dispatch (transmission system now includes all Reliability Projects and Economic Projects)
• Hurdle rates same as Status Quo except no hurdle rate between SPP and ETI
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Benefit Metric – ETI Adjusted Production Cost
• Same Benefit metric being used by the SPP Cost Benefit Task Force in the Future Market Design Study
• Adjusted Production Cost for ETI
Generation Total Variable Cost
+ Purchase Cost at ETI Load-Hub Rate
– Sales Revenue at ETI Generation-Hub Rate
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ETI Benefits
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2012 Benefits to ETIETI Operational Benefits
Status Quo - Cottonwood
in Eastern Interconnect
Integrated SPP/ETI Case -
Cottonwood in Eatern
Interconnect
Status Quo - Cottonwood
in ERCOT
Integrated SPP/ETI Case - Cottonwood
in ERCOT
ETI Benefits - Cottonwood
in Eastern Interconnect
ETI Benefits - Cottonwood
in ERCOT2012 2,336.21 2,233.58 2,389.48 2,299.72 102.64 89.76
1 209.98 197.56 209.98 197.24 12.41 12.74 2 174.16 164.55 173.92 165.01 9.62 8.91 3 186.52 175.32 186.43 174.90 11.19 11.53 4 175.97 161.66 175.22 161.93 14.32 13.29 5 191.15 180.59 194.53 185.27 10.56 9.26 6 202.72 196.08 213.34 209.25 6.65 4.09 7 227.63 222.80 239.92 240.17 4.84 (0.24) 8 228.14 225.39 245.36 246.37 2.74 (1.01) 9 197.61 190.22 204.86 197.30 7.39 7.56
10 192.89 184.53 193.98 186.39 8.35 7.59 11 156.56 149.09 158.40 150.28 7.47 8.12 12 192.88 185.79 193.56 185.62 7.10 7.94
Adjusted Production Cost in MM$ - (APC) Operational Benefit MM$
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Discussion of Findings - ETI
• Cottonwood in Eastern Interconnection (EIC) ETI Generation Cost reduced by $404 M, purchase costs increased
by $237 M and sales revenue was reduced by $64 M, resulting in an overall benefit of $103 M.
Based on an 18% carrying charge rate for Transmission Investment, this $103 M would support about $570 M in transmission investment
Proposed total cost of Reliability and Economic Upgrades is about $344 M
Benefit to Cost Ratio is 1.63 Includes $5 M in ROA implementation cost
• Cottonwood in ERCOT Benefits reduced due to loss of Cottonwood generation $90 M in benefits would support about $500 M in Transmission
Investment Benefit to Cost Ratio drops slightly to 1.43
Includes $5M in ROA implementation costs
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ETI Benefits Sensitivity – NO RMR Requirements
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2012 Benefits to ETI if RMR Requirement RemovedETI Operational Benefits
Adjusted Production Cost in MM$ - (APC)
Status Quo - Cottonwood
in EIC
Integrated SPP/ETI Case - Cottonwood
in Eastern Interconnect -
No RMR Requirements
ETI Benefits - Cottonwood
in Eastern Interconnect -
No RMR Requirements
2012 2,336.21 2,173.67 162.54 1 209.98 188.66 21.31 2 174.16 155.40 18.77 3 186.52 167.30 19.21 4 175.97 156.77 19.20 5 191.15 173.90 17.25 6 202.72 193.40 9.32 7 227.63 221.28 6.35 8 228.14 223.94 4.20 9 197.61 186.02 11.59
10 192.89 180.71 12.18 11 156.56 143.99 12.58 12 192.88 182.31 10.57
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Discussion of Findings – No RMR Requirement
• Benefits increase to $163 M, creating an incremental benefit of about $60 M
• This $60 M in incremental benefits would support about $333 M in potential projects Based on 18% carrying charge rate on transmission investment
Potential for future Economic Upgrade
There is no guarantee that this level of investment would be sufficient to relieve the remaining RMR requirements
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Questions?
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Detail Slides
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2012 ETI Benefits Breakdown
Gen MWH Gen $Gen Cost - $/MWh
Purch MWH Purch Cost $
Purch Cost - $/MWh Sale MWH Sale Rev $
Sales Revenue -
$/MWh Benefits2012 3,461,447 404,061,106 116.73 -2,934,040 -237,067,800 80.80 -527,407 -64,359,021 122.03 102,634,286
1 584,633 68,573,567 117.29 -550,173 -51,334,735 93.31 -34,461 -4,825,091 140.02 12,413,7412 257,711 32,610,295 126.54 -248,583 -21,680,935 87.22 -9,129 -1,314,599 144.01 9,614,7623 436,419 44,589,306 102.17 -421,145 -31,326,310 74.38 -15,274 -2,068,576 135.43 11,194,4204 355,362 40,168,595 113.04 -354,140 -25,718,392 72.62 -1,221 -134,980 110.54 14,315,2225 337,433 37,629,680 111.52 -274,419 -20,564,155 74.94 -63,015 -6,501,816 103.18 10,563,7096 196,660 23,652,936 120.27 -130,197 -9,580,478 73.58 -66,462 -7,426,933 111.75 6,645,5257 174,574 23,557,281 134.94 -72,653 -6,695,495 92.16 -101,921 -12,024,652 117.98 4,837,1348 177,645 22,831,198 128.52 -90,478 -8,845,269 97.76 -87,167 -11,242,531 128.98 2,743,3979 274,870 30,491,316 110.93 -218,170 -16,468,768 75.49 -56,700 -6,636,008 117.04 7,386,540
10 172,741 22,967,024 132.96 -137,230 -10,588,263 77.16 -35,511 -4,024,079 113.32 8,354,68211 248,017 28,714,237 115.78 -214,861 -16,805,985 78.22 -33,156 -4,438,471 133.87 7,469,78112 245,382 28,275,672 115.23 -221,991 -17,459,015 78.65 -23,391 -3,721,284 159.09 7,095,372
ETI Benefits Breakdown - Cottonwood in EIC - With Reliability and Economic Transmission Upgrades
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2012 ETI Benefits Breakdown
Gen MWH Gen $Gen Cost - $/MWh
Purch MWH Purch Cost $
Purch Cost - $/MWh Sale MWH Sale Rev $
Sales Revenue -
$/MWh Benefits2012 3,439,498 395,276,876 114.92 -3,310,541 -287,728,528 86.91 -128,957 -17,789,618 137.95 89,758,730
1 607,197 70,743,812 116.51 -579,214 -54,230,757 93.63 -27,983 -3,773,853 134.86 12,739,2022 264,373 32,838,565 124.21 -255,791 -22,716,208 88.81 -8,582 -1,208,339 140.80 8,914,0183 438,799 44,215,170 100.76 -427,902 -31,300,125 73.15 -10,898 -1,387,820 127.35 11,527,2254 391,365 43,194,221 110.37 -390,585 -29,822,447 76.35 -780 -86,047 110.27 13,285,7275 326,408 37,418,768 114.64 -321,851 -27,630,574 85.85 -4,557 -528,412 115.95 9,259,7826 197,894 22,634,070 114.37 -193,077 -17,940,629 92.92 -4,817 -607,471 126.11 4,085,9707 178,337 21,799,524 122.24 -173,204 -21,396,621 123.53 -5,133 -646,314 125.91 -243,4118 128,006 15,119,437 118.12 -122,813 -15,445,157 125.76 -5,193 -688,640 132.60 -1,014,3609 258,789 29,128,529 112.56 -252,909 -20,872,665 82.53 -5,880 -700,678 119.17 7,555,186
10 188,860 23,936,631 126.74 -175,238 -14,418,146 82.28 -13,622 -1,928,846 141.60 7,589,63911 225,661 27,204,776 120.56 -201,751 -15,539,812 77.02 -23,910 -3,543,179 148.19 8,121,78512 233,809 27,043,372 115.66 -216,207 -16,415,386 75.92 -17,602 -2,690,018 152.82 7,937,967
ETI Benefits Breakdown - Cottonwood in ERCOT - With Reliability and Economic Transmission Upgrades
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Mak NagleManager, Technical Studies & Modeling(501)[email protected]
Wayne [email protected]