Long-Term Planning and Integration of

Renewables at a Mid-Sized Utility

LEE ALTERSR . SUPPLY S I DE PLANNER

TUCSON ELEC TRI C POWER

Presentation Overview

• About TEP and its renewable energy goal

• System balancing requirements

• System balancing resources

• Other long-term renewable integration strategies• Energy storage

• Sub-hourly markets

• Sub-hourly analytic capabilities

• University/industry partnerships

• Corporate and public awareness

About TEP

• Third largest utility in Ariaona, after APS and SRP

• Peak demand of 2,300 MW

• Vertically integrated

• 420,000 customers

• 1% annual growth

• State EE standard of 22% by 2020

• State RE standard of 15% by 2025

• Corporate RE goal of 30% by 2030

3

Retail Sales

2017 Integrated Resource Plan

Portfolio Energy Mix

4

2017 2032

TEP

5

2017 Integrated Resource Plan

Timeline

6

CAISO Typical Spring Day(I just couldn’t resist)

Average 10-min ramp = 1.6% of system peak(29% of 2016 retail sales served by renewables)

2016 Renewable Energy Mix

TEP’s Duck Curve(Average of March 2024)

8Average 10-min ramp during HE 17 = 1.2% of system peak

(20% of 2024 retail sales served by renewables)

2024 Renewable Energy Mix

10

Kingman

Red Horse Wind

Macho Springs

Rio RicoFt. Huachuca

Gato Montes Tech Park

Distributed Gen

Avalon IE.On Tech Park

Red Horse Solar

Avra Valley

Sites Used in Analysis:• 3 wind• 5 single-axis tracking• 3 fixed-tilt• 1 DG

Black Mountain

11

Base Case

GeographicallyDispersed Case

GeographicallyConcentrated Case

12

Allocation of Renewable Energy Capacity (2024)

2017 RE Capacity: 450 MW2024 RE Capacity: 920 MW

13

14

15

TEP Ramping Requirements Under Alternative Siting Scenarios for Future Renewable Energyand Their Comparison to TEP Ramping Resources Under Optimal Conditions (2024)

200 MW / 10 min =7.7% of system peak

Energy Storage:

Batteries

• In 2017, TEP commissioned two 10 MW x 2.5 MWh Li-ion batteries, primarily for frequency response and voltage support

• In 2019/2020, TEP will commission a solar-tied 30 MW x 120 MWh Li-ion battery

17

Reciprocating Internal Combustion Engines

• TEP is procuringten 20 MW units

• Replacing twoold, gas-firedsteam units

• Improve reliability

• Integrate renewables

• Efficiently meet local min gen requirements

18

2017 Hourly and Daily Gas Requirements

19

2024 Hourly and Daily Gas Requirements

20

Energy Storage:

Natural Gas Storage

21

Energy Storage:

Pumped Hydro

22

EIM / RTO Membership

23

Enhanced Dispatch Cost Modeling:

Why and How

• To assess renewable integration strategies• Fast response generators, storage options, market

options, etc.

• Need to configure Aurora for sub-hourly modeling• Renewable energy generation, market prices, resource

parameters, etc.

• Need to improve post-processing capabilities

• Need a deep bench to do it right and to get buy-in

24

Enhanced Dispatch Cost Modeling:

Preliminary Analysis at TEP

• Purpose• See how the model works at high time resolutions• Gauge the effort involved• Explore potential applications

• Case study• 1-hour vs 1-minute modeling of July 2024• 200 MW of RICEs versus 200 MW of batteries• Aurora version 12.3.1048• Commitment optimization• DemandNetMR for batteries• Renewable generation profile based on 1-minute actuals

25

University of Arizona Tech Park

• 1300 acre campus

• 2M sqft of high-tech offices and laboratories

• Provides an interactive ground to connect university, community, and industry in the pursuit of technology innovation

• Commercializes invention stemming from university research

33

University of Arizona Tech Park

34

Tech Park Solar Zone

• One of the largest multi-tech solar demo sites in US

• Partnership between University of AZ and TEP

• Side-by-side testing of new technologies, plus:• Forecasting• Generation and distribution• Assembly and manufacturing• Product development• Testing and evaluation• Workforce training• Environmental impact evaluation• Public education and demonstration

35

Tech Park Solar Zone

• Phase I• Recently completed

• Focused primarily on generation and distribution

• Each solar tenant has a 20-year PPA with TEP

• Phase II• In progress

• Focused on energy storage, grid optimization, micro grids, distributed systems, and integrated and embedded solar materials

• Includes plans for a solar education and visitor center

36

Tech Park Solar Zone

37

38

39