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 1

February 2015 Acknowledgments Acknowledgments Clint Kalich Avista Jimmy Lindsay Portland General Electric Gordon Matthews BPA Tomás Morrissey PNUCC (lead author) Terry Toland T T l d Cl Clark PUD k PUD Eli Elizabeth Hossner b th H P Puget Sound Energy t S d E 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 Mark Stokes Idaho Power Idaho Power Zac Yanez Zac Yanez Snohomish PUD Snohomish PUD Sima Beitinjaneh Portland General Electric Dave Warren WAPUDA Stefan Brown Portland General Electric 2

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 on investment 3

EIA – data for 2012 February 2015 Lawrence Berkeley National Laboratory, 2014. Growing popularity 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 NW Total 66 66 10 850 10,850 California 1,537 158,940 US Total 3,680 323,365 $14 ed watt $12 $10 rs per installe $8 $6 $4 Dollar $2 $ ‐ 4 1998 2000 2002 2004 2006 2008 2010 2012

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 5 Map from NREL

February 2015 Energy Energy Market Energy Produced, Time Value Price/MWh Price/MWh MWh MWh 7:00 $27.43 0.01 $0.14 • Estimated using hourly 8:00 $31.28 0.19 $6.00 solar shape and hourly 9:00 $32.45 0.39 $12.72 10:00 10:00 $36.52 $36.52 0.55 0.55 $20.12 $20.12 2015 Mid C 2015 Mid ‐ C market k t 11:00 $41.35 0.65 $26.84 forecast 12:00 $37.19 0.69 $25.66 13:00 $38.05 0.69 $26.37 14:00 $40.36 0.67 $27.04 15:00 $42.75 0.59 $25.35 • Annual average of 16:00 $43.39 0.47 $20.26 17:00 $43.21 0.29 $12.70 $35/MWh 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 6 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% 70% 60% city factor 50% 40% 40% Solar capac 30% 20% 10% 0% 1 3 5 7 9 11 13 15 17 19 21 23 7 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 Plant type Frame w/oil backup 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 p y $16,300 , 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 8

February 2015 Peak capacity considerations Peak capacity considerations • Many winter peaking y p g Peak net of solar shifts Peak without solar P k ith t l utilities may not see 1,600 a value W) 1 575 1,575 t of solar (MW • Peak shift may 1,550 reduce peak capacity p p y 1 525 1,525 mple load net value (chart) No solar 1,500 110 MW DC 1,475 , 220 MW DC Exa • Solar could provide 1,450 hydro augmentation 16 17 18 19 20 Hour ending ou e d g 9 Load data from BPA scaled down 5x Solar data from NREL PV Watts

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) 10

February 2015 A range of values A range of values $90 $80 $80 $70 Integration $60 $ Hedge Hedge ollars/MWh $50 RPS $40 Peak capacity D Wheeling $30 Line loss $20 E Energy $10 $0 Low High ‐ $10 $10 11

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? 12

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 Wheeling $0 to $6 900 $0 to $6,900 $0 to $7 $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 13

February 2015 Value, east of Cascades Value, east of Cascades Idaho utility, south facing C Component t 1 MW DC 1 MW DC, yearly l P Per MWh MWh Energy $43,000 to $48,500 $32 to $35 Line loss $3,200 to $3,600 $2 to $3 Wheeling Wheeling $0 to $6,900 $0 to $6,900 $0 to $5 $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 14