July 26, 2013

Alaine Ginocchio, Western Interstate Energy Board

LOLE Best Practices Working Gas Group Annual Meeting

Vancouver, Canada

Survey of Western Gas-Electric Coordination & Planning Efforts with Emphasis on the SPSC Regional Study

Presentation Overview

1. Overview of Interdependency Issues

2. Planning and Coordination Efforts in the West:

• NW Gas-Electric Power and Planning Task Force

• NW Mutual Assistance Agreement (NWMAA)

• California ISO

• California Energy Commission (CEC)

• WECC

3. SPSC’s Task Force & Planned Study of Infrastructure

Adequacy and Operational Flexibility

• Background

• Western Gas-Electric Regional Assessment Task Force

• Overview of Planned Regional Study

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As the two industries converge, what are the key issues as seen by the stakeholders?

• Summary from FERC 2012 regional technical conferences: • Communications, Coordination, and Information-Sharing

• Scheduling-Related Issues

• Electric Resource Adequacy

• NERC Activity: revise reliability assessments

• Summary from Western Stakeholders: • Operational Issues

• Resource Adequacy and Infrastructure

• Integration of Variable Resources

• Alternative Solutions and Mitigation Strategies

• Cost Allocation of Infrastructure and Firm Services

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Planning & Coordination Initiatives in the West

• NW Gas-Electric Power and Planning Task Force

• NW Mutual Assistance Agreement (NWMAA)

• California ISO

• California Energy Commission (CEC)

• WECC

• SPSC Gas-Electric Task Force and Regional Study

For more information see WIEB Staff Paper: Regional Collaborations 4

Planning & Coordination Initiatives in the West

NW Gas-Electric Power and Planning Task Force Coordinating efforts between the 2 industries over the last 2 years to investigate the interdependencies of gas and electric generation

• Formally established in April 2012 under the auspices of Pacific Northwest Utilities Conference Committee (PNUCC) the Northwest Gas Association (NWGA)

• Members of the power and gas sectors meet every two months to assess the growing interdependence of natural gas and electric generation.

• In addition to publishing a number of reports, work underway includes: a demand/supply assessment of the I-5 Corridor; and an I-5 assessment of infrastructure adequacy.

For more information visit the Task Force webpage.

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Planning & Coordination Initiatives in the West

NW Mutual Assistance Agreement (NWMAA) Defines terms for cooperation in an emergency, encourages communication, and establishes an Emergency Planning Committee

• Put in place March 1999 (recast & revitalized)

• Each signatory to the Agreement is an entity that utilizes, operates or controls natural gas transportation and/or storage facilities in the Pacific Northwest (British Columbia, Alberta, Washington, Oregon, Nevada, and Idaho).

• Members share emergency contact information and participate in planning meetings and emergency exercises.

• The Emergency Planning Committee meets twice a year and is working on region-wide emergency protocols

For more information visit the NWMAA webpage.

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Planning & Coordination Initiatives in the West

California ISO Detailed procedures for gas derates and outages for 3 time frames

• Detailed procedures for the roles, communications and actions related to natural gas transmission reductions or curtailments

• Includes impacts to the electric system in real time, two days advance notice, and more than 2 day time frames

California Energy Commission (CEC) Integrated energy policy report with extended stakeholder process

• The CEC prepares a biennial IEPR that contains an assessment of major energy trends and issues facing the state’s electricity, natural gas, and transportation fuel sectors.

• Preparation of the IEPR involves close collaboration with federal, state, and local agencies and a wide variety of stakeholders in an extensive public process to identify critical energy issues and develop strategies to address those issues.

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Planning & Coordination Initiatives in the West

Western Electricity Coordinating Council

• Natural Gas-Electric Coordination Conference , Nov. 2012

• WECC held a regional conference to coordinate procedures for the communications and notifications required by FERC Order 587-V.8* with key members from the gas and power sectors from around the Western Interconnection

• A gas-electric communication protocol was drafted

• WECC anticipates holding additional meetings of the two sectors

• Study of Gas-Electric Interface & Risk to Reliability

• Commitment by WECC in their transmission planning to examine this issue in conjunction with the the SPSC effort.

*Standards to enhance the clarity of the content and format of critical, non-critical, and planned service outage notices issued by pipelines and change parties to whom pipelines make notifications

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State-Provincial Steering Committee

• SPSC is composed of one representative of the Governor & one of the PUC from each state in the WI & representatives from Alberta and B.C.

• Created in 2009 to implement a grant to enable states/provinces to participate in interconnection-wide transmission planning.

• Provides input into industry interconnection-wide transmission planning

• Fosters policies to improve the efficiency of the transmission system,

• Valuates region-wide actions to minimize the cost of integrating large amounts of renewable energy.

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State-Provincial Steering Committee

• This has been a priority for SPSC:

• Panel at each of last 3 meetings

• October 4, 2012: panel of experts from around the region discussed benefits of a regional assessment

• October 5, 2012: SPSC passed motion to establish a task force that will identify critical issues and develop the scope of work (SOW) for a regional assessment

• April 10, 2013: Adopted Task Force’s SOW and approved funding for the project

• RFP released on May 22 and proposals received July 3

• Review of proposals in progress 10

SPSC’s Gas-Electric Task Force

The Western Gas-Electric Regional Assessment Task Force

Commr John Savage, Oregon PUC

Commr Mike Florio, California PUC Randy Friedman, Northwest Natural

Commr Philip Jones, Washington UTC Shelley Corman, Transwestern Pipeline Co.

Commr Rebecca Wagner, Nevada PUC Steven Hearn, Transwestern Pipeline Co.

Commr Ron Allen, PSC Utah Lynn Dahlberg, Williams - Northwest Pipeline

Melissa Jones, California Energy Comm. James Wilde, APS

Clint Kalich, Avista Corp. Steve Harper, Avista Corp.

Phillip Popoff, Puget Sound Energy Clay Riding, Puget Sound Energy

Beth Musich, Southern California Gas Co. Hardev Juj, BPA

and San Diego Gas & Electric Robert Diffely, BPA

Mia Vu, PG&E Craig Williams,WECC

Roger Graham, PG&E Charlie Black, NWPCC

Liam Noailles, Xcel Energy John N. Moura, NERC

Curtis Dallinger, Xcel Energy Ed Murrell, FERC (OEPI)

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The Western Gas-Electric Regional Assessment Task Force

• Task Force: 27 members who met regularly to set the direction and finalize proposals

• Working Group: 16 member subset of the Task Force

• met between Task Force meetings

• developed proposals that were reviewed, revised and/or approved by full Task Force

• Review Team: 5 member subset of Working Group

• Reviewed and summarized responses to the RFI

• Developed initial re-draft of SOW incorporating information from RFI responses

• All groups had strong engagement by natural gas transportation and electric industries and regulatory entities.

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Western Gas-Electric Task Force

• Met 6 times from Nov. 2012- May 2013

• Formed working group that met 6 time during same period

• Initially identified critical issues and priorities for the study

• Early on reached broad agreement on two fundamental questions for the study: • Will there be adequate natural gas infrastructure to meet the long-

term needs of the electric industry in the WI ?

• Will the gas system have adequate short-term operational flexibility to meet electric industry requirements

• Developed draft SOW

• Key takeaway: the issues are more complex and challenging than initially expected

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Western Gas-Electric Task Force

• Three approaches under consideration • Build a model

• Have contractor perform study using their resources

• Pipelines conduct modeling of their own systems

• RFI: solicited information from contractors on alternative approaches, appropriate project phases, analytical tools, and data to analyze the study questions.

• Informed by the information in the RFI responses, finalized the SOW

• SPSC adopted SOW at their last meeting and approved funding for the study 14

Study Questions

The study will address the two fundamental questions identified by the Task Force:

1. Will there be adequate natural gas infrastructure (interstate and intrastate), including storage, to meet the long-term needs of the electric industry in the Western Interconnection? If not, what needs to be done?

2. Will the gas system have adequate short-term operational flexibility to meet electric industry requirements in the Western Interconnection? If not, what needs to be done?

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Overview of the Study

• Two Fundamental Questions, Two Phases

• Phase 1/Question 1: Infrastructure Adequacy • Mapping systems, forecasting demand, equilibrium analyses

• Scenario Analysis

• Contingency Analysis

• Phase 2/ Question 2: Operational Level Analysis with Focus on Integrating Variable Generation • Target areas based on results from Phase 1 and stakeholder input

• Significant role for pipelines

• Technical Advisory Group 16

Phase 1: Infrastructure adequacy

• Identify and provide a high-level geographical representation of the key components of the two systems currently and 10-years in the future

• Identify appropriate subregions for the analysis (aggregate will include the entire Western Interconnection)

• Identify and provide forecasts of the demand-side of the natural gas system (including LDCs, industrial users, and gas generators) currently and 10 years in the future using your own or other sources.

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Phase 1: Infrastructure adequacy

• Market interface balance: • identify the market equilibrium or gap 10-years out between the

electric sector’s demand for and the gas sector’s supply of gas in subregions of Western Interconnection: • Annual • Winter peak • Summer peak • Fall period when gas is being injected into storage • Spring

• Address potential impacts under different levels of gas supply and transportation contractual relationships (i.e., firm and nonfirm)

• Contractor will recommend whether it is critical to examine the market equilibrium/gap for intermediate year(s) for the Western Interconnection or appropriate subregions.

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Phase 1: Infrastructure adequacy

• Scenario analysis: evaluate the adequacy of the natural gas pipeline system to meet the electric sector’s demand for natural gas and other demands for natural gas 10-years in the future under expected conditions and a robust set of plausible futures.

• Contingency analysis: evaluate a series of contingencies characterized by discrete infrastructure, equipment failures, weather disruptions or other major events for the purpose of testing the ability of the combined system to respond to short-term disruptive events and maintain reliability 10-years in the future.

• The contractor will recommend scenarios and contingencies to be analyzed. Ultimately these will be developed in conjunction with a stakeholder advisory group. 19

Phase 2: Operational level assessment

• Evaluate the operational flexibility of the natural gas pipeline system to deliver large amounts of natural gas over short periods of time enabling the electric sector gas-fired generator fleet to ramp up or down as required to meet electrical loads, for example, to integrate high levels of variable generation in the future.

• Drill down on short (intra-day, volatile week) time periods to assess gas deliverability during big gas-fired generation ramps such as rapid and significant changes in wind and solar variable generation.

• Focus on targeted geographic areas informed by Phase 1 findings and stakeholder input about the need for operational analysis.

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Phase 2: Operational level assessment

• Direct participation of natural gas pipeline companies in

performing the analysis. Contractors will describe how they will perform the necessary functions: • delivering findings from electric models/analysis to the participating

gas pipeline companies;

• ensuring sufficient participation of gas companies for the study to be relevant to the targeted area studied;

• coordinating gas pipeline modeling methodologies, inputs and assumptions for consistency;

• performing data conversion, data modification, and filling in of missing data;

• compiling modeling results and integrating them into a common source;

• validating and vetting process for data, assumptions and results.

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Technical Advisory Group

• Continued stakeholder role: TAG composed of representatives from gas and electricity industries and regulators

• Iterative process

• Potential role • Vet data and assumptions

• Scenario and contingency development

• Evaluate early runs of analysis for potential adjustments

• Evaluate results of Phase 1

• Developing areas to target in Phase 2 22

Project Information

• More information on the Task Force Website:

http://www.westgov.org/ngei/index.htm

• Announcements

• RFP

• Reference material

• Archive of past Task Force and informational webinars

• And more

• Staff contacts, Western Interstate Energy Board (WIEB):

• Alaine Ginocchio, aginocchio@westgov.org

• Tom Carr, tcarr@westgov.org

• Steve Ellenbecker, sellenbecker@westgov.org

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