RMATS Economics Economic Comparisons Preliminary: Distribution of Gains and Losses
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Transcript of RMATS Economics Economic Comparisons Preliminary: Distribution of Gains and Losses
Rocky Mountain Area Transmission Study RRocky ocky MMountain ountain AArea rea TTransmission ransmission SStudytudy
RMATS EconomicsEconomic Comparisons
Preliminary: Distribution of Gains and Losses
RMATS Steering Committee
July 15, 2004
2 RMATS Recommendations
Modeling since Steering Committee call
Refined the resource assumptions used in project-specific economics• Removed wind resources associated with MT Upgrades and
WY/CO Expansion projects when valuing stand-alone projects
Modified interface capacities for Bridger West, West of Naughton, Path C and TOT 4A
Preliminary analysis: Distribution of economic gains and losses
Preliminary analysis: Implications for state tax revenues
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Comparative Economics
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Comparative Economics
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Distribution of gains and losses
A first look at spatial distribution of net savings/costs
Key driver: LMPs. Also loads, generation, and fuel/other VOM
As modeled in ABB MS for 2013 test year
Results: geographic, by load and generator category
Substantially greater net benefits for Rocky Mountain states
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Background info . . .
Locational Marginal Prices (LMP)
LMP: Represents the cost or savings from supplying the next MW at a given node (bus) on the grid
If there were no transmission losses or constraints (perfect liquidity), all LMP’s would be equal and they would be the same as the cost of the unit on margin
In the case of a low cost generator with no available transmission (bottled up), the LMP would be that generator’s marginal cost
LMPs are transitory, arguably insufficient for predicting where benefits will fall• Driven by congestion, loads, generation, gas and other fuel prices
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Why are Load Savings and Generator Gross Margin so different?
In concept, if there were no losses or congestion (perfect transmission liquidity), then LMPs at any given hour would be the same across the Western Interconnect
Load costs and generator revenues would be the same for the system as a whole, but different by area because load and generation quantities would be different• Load costs: the sum of hourly loads X hourly
LMP• Generator revenues: the sum of hourly
generation X hourly LMP• Generator gross margin: generator revenues
less annual fuel & other VOM Congestion leads to changes in the type and
location of plants that are dispatched • Changes generation (MWh)• Changes fuel costs
This in turn affects LMPs - the price paid by load and the price received by generators
Generation (MW)
Load (MW)
t
q
LMPt
p
For a given area, excludes import/exports:
No
Con
stra
ints
Assumes that load is not sensitive to price (LMP), no price elasticity
Generation (MW)
Load (MW)
t
q
LMP
t
p
For a given area, excludes import/exports:
With
Con
stra
ints
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Distribution of Economic Gains & LossesRecommendation 1
Reflects the changes in load cost and generator gross margin between the Reference Case and Recommendation 1. This distribution assumes that pricing is on an hourly, LMP basis. Reflects fuel and other VOM modeling, and does not include capital & fixed O&M costs
Load Cost is hourly demand (MWh) at each load node x hourly LMP ($), summed for 2013
Generator Gross Margin is hourly generation (MWh) at generation node x hourly LMP, summed for 2013 (generator revenue), less annual fuel & other VOM costs
NOTE: Idaho & Montana state totals do no include areas covered in the Northwest Power Pool
Change in Load Cost
Change in Generator
Gross MarginRocky Mountain States (1,066) 391NWPP- US (448) (476)NWPP- Canada (173) (170)Mexico- CFE (23) (27)California (495) (425)AZ, NM & S. NV (326) (454)Total (2,530) (1,161)
2004 Dollars in Millions
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Distribution of Economic Gains & LossesRecommendation 2
Reflects the changes in load cost and generator gross margin between the Reference Case and Recommendation 2. This distribution assumes that pricing is on an hourly, LMP basis. Reflects fuel and other VOM modeling, and does not include capital & fixed O&M costs
Load Cost is hourly demand (MWh) at each load node x hourly LMP ($), summed for 2013
Generator Gross Margin is hourly generation (MWh) at generation node x hourly LMP, summed for 2013, less annual fuel and other VOM costs
Change in Load Cost
Change in Generator
Gross Margin
Rocky Mountain States (1,821) 272NWPP- US (901) (948)NWPP- Canada (360) (354)Mexico- CFE (42) (50)California (1,087) (636)AZ, NM & S. NV (603) (840)Total (4,813) (2,555)
2004 Dollars in Millions
NOTE: Idaho & Montana state totals do no include areas covered in the Northwest Power Pool
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Distribution of Economic Gains & LossesState summary
Change in Load Cost
Change in Generator Gross
MarginChange in Load
Cost
Change in Generator Gross
MarginChange in Load
Cost
Change in Generator Gross
Margin
Rocky Mountain StatesColorado
Colorado- East (373) 25 (691) 160 (317) 134Colorado- West (32) (87) (59) (129) (27) (42)Laramie River (21) 17 (44) (65) (23) (83)
subtotal (427) (45) (794) (35) (367) 10Idaho
Goshen (KGB) (36) 10 (61) 5 (25) (5)Idaho- West (90) (38) (157) (66) (67) (28)
subtotal (126) (29) (218) (61) (92) (33)Montana
Broadview (9) 96 (21) 238 (12) 142Colstrip (3) (13) (7) (94) (4) (81)Montana- West (32) 30 (59) 57 (27) 27Yellowtail (0) (5) (0) (17) (0) (11)
subtotal (44) 108 (88) 185 (43) 77Utah
Bonanza (8) (22) (13) (38) (5) (15)Utah- North (321) (48) (452) (65) (131) (17)Utah- South (43) 13 (60) (67) (17) (80)
subtotal (372) (58) (525) (170) (153) (112)Wyoming
Big Horn Basin (22) 40 (49) 33 (27) (8)Black Hills (37) (33) (78) (69) (41) (36)Jim Bridger 0 54 0 (53) 0 (107)SW Wyoming (25) 167 (41) 145 (17) (23)Wyoming- Central (13) 185 (28) 298 (14) 114
subtotal (96) 414 (196) 353 (99) (61)
Rocky Mtn. States Sub-total (1,066) 391 (1,821) 272 (755) (119)
2004 Dollars in Millions 2004 Dollars in Millions 2004 Dollars in Millions
Recommendation 1 Recommendation 2 Incremental savings due to export
Delta from Reference Case Delta from Reference Case
NOTE: Idaho & Montana state totals do no include areas covered in the Northwest Power Pool
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Distribution of Economic Gains & LossesRecommendation 1 & 2
Change in Load Cost
Change in Generator Gross
MarginChange in Load
Cost
Change in Generator Gross
MarginChange in Load
Cost
Change in Generator Gross
Margin
Rocky Mtn. States Sub-total (1,066) 391 (1,821) 272 (755) (119)
NWPP- USNorthwest (387) (432) (802) (882) (415) (450)Sierra (61) (44) (98) (66) (37) (22)
subtotal (448) (476) (901) (948) (452) (472)
NWPP- CanadaBC Hydro (131) (126) (272) (263) (141) (137)Aquila (8) (9) (17) (19) (9) (10)Alberta (34) (34) (71) (72) (37) (38)
subtotal (173) (170) (360) (354) (187) (184)
Mexico- CFEMexico- C (23) (27) (42) (50) (19) (22)
subtotal (23) (27) (42) (50) (19) (22)
CaliforniaImperial (8) (6) (16) (12) (8) (6)San Diego (39) (25) (81) (47) (42) (22)So. California (182) (93) (371) (187) (189) (94)LADWP (53) (10) (105) (18) (52) (8)IPP 0 (101) 0 81 0 182PG AND E (213) (191) (514) (454) (301) (263)
subtotal (495) (425) (1,087) (636) (592) (211)
AZ, NW & S. NVNew Mexico (53) (42) (103) (87) (51) (45)Arizona (208) (310) (380) (569) (172) (260)Nevada (60) (61) (109) (108) (49) (47)WAPA- LC (6) (41) (12) (76) (6) (35)
subtotal (326) (454) (603) (840) (277) (386)
Total (2,530) (1,161) (4,813) (2,555) (2,283) (1,394)
2004 Dollars in Millions 2004 Dollars in Millions 2004 Dollars in Millions
Recommendation 1 Recommendation 2 Incremental savings due to export
Delta from Reference Case Delta from Reference Case
Rocky Mountain Area Transmission Study RRocky ocky MMountain ountain AArea rea TTransmission ransmission SStudytudy
Appendix
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Production Cost (VOM) Comparison
avg
Western Interconnect Production Costs (VOM) ($Millions)
$21,306
$19,988
$19,974
$19,780
$18,458
$18,000 $18,500 $19,000 $19,500 $20,000 $20,500 $21,000 $21,500
Reference Case
Alternative 1- Light Tx Build
Alternative 1- Medium TxBuild
Recommendation 1
Recommendation 2
$ Millions
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Antelope Mine
Dave Johnston
LRS
Cheyenne Tap
Ault
Green Valley
MinersJim Bridger
NaughtonBen Lomond
Midpoint
Recommendation 1 Transmission Projects
Broadview
Colstrip
Added Series Compensation Only
Taft
Montana Upgrades
Bridger Expansion
New WY- CO lines
Treasureton
Garrison
Townsend
Borah West
Path C
West of Naughton
West of Bridger
Black Hills to C. Wyoming
C Wyoming to LRS
TOT 3
TOT 7
TOT 4A
West of Colstrip
West of Broadview
Montana to NW
500 Wind
210 Gas 500 Coal
500 Wind
1150 Wind
700 Coal
359 Coal
50 Wind
250 Coal
280 Wind
125 Wind
575 Coal
100 Wind
575 Coal
140 Gas
250 Wind
Added 345 kV Line
Modified Interface
Added Resource
Bridger E
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Antelope Mine
Dave Johnston
LRS
Cheyenne Tap
Ault
Green Valley
Miners
Jim Bridger
NaughtonBen Lomond
Midpoint
Recommendation 1 Transmission Projects Montana Upgrades (less gray)
Broadview
Colstrip
Added Series Compensation Only
Taft
Montana Upgrades
Bridger Expansion
New WY- CO lines
Treasureton
Existing Ben Lomond to Borah 345kV is now looped in at Treasureton
Amps phase shifter, Flaming Gorge transformer, Midpoint to Boise 230kV are included in all runs
Garrison
Townsend
Borah West
Path C
West of Naughton
West of Bridger
Black Hills to C. Wyoming
C Wyoming to LRS
TOT 3
TOT 7
TOT 4A
West of Colstrip
West of Broadview
Montana to NW
500 Wind
210 Gas 500 Coal
500 Wind
1150 Wind
700 Coal
359 Coal
50 Wind
250 Coal
280 Wind
125 Wind
575 Coal
100 Wind
575 Coal
140 Gas
250 Wind
Added 345 kV Line
Modified Interface
Added Resource
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Antelope Mine
Dave Johnston
LRS
Cheyenne Tap
Ault
Green Valley
Miners
Jim Bridger
NaughtonBen Lomond
Midpoint
Broadview
Colstrip
Added Series Compensation Only
Taft
Montana Upgrades
Bridger Expansion
New WY- CO lines
Treasureton
Existing Ben Lomond to Borah 345kV is now looped in at Treasureton
Amps phase shifter, Flaming Gorge transformer, Midpoint to Boise 230kV are included in all runs
Garrison
Townsend
Borah West
Path C
West of Naughton
West of Bridger
Black Hills to C. Wyoming
C Wyoming to LRS
TOT 3
TOT 7
TOT 4A
West of Colstrip
West of Broadview
Montana to NW
500 Wind
210 Gas 500 Coal
500 Wind
1150 Wind
700 Coal
359 Coal
50 Wind
250 Coal
280 Wind
125 Wind
575 Coal
100 Wind
575 Coal
140 Gas
250 Wind
Added 345 kV Line
Modified Interface
Added Resource
Recommendation 1 Transmission Projects Bridger Expansion (less gray)
17 RMATS Recommendations
Antelope Mine
Dave Johnston
LRS
Cheyenne Tap
Ault
Green Valley
Miners
Jim Bridger
NaughtonBen Lomond
Midpoint
Broadview
Colstrip
Added Series Compensation Only
Taft
Montana Upgrades
Bridger Expansion
New WY- CO lines
Treasureton
Existing Ben Lomond to Borah 345kV is now looped in at Treasureton
Amps phase shifter, Flaming Gorge transformer, Midpoint to Boise 230kV are included in all runs
Garrison
Townsend
Borah West
Path C
West of Naughton
West of Bridger
Black Hills to C. Wyoming
C Wyoming to LRS
TOT 3
TOT 7
TOT 4A
West of Colstrip
West of Broadview
Montana to NW
500 Wind
210 Gas 500 Coal
500 Wind
1150 Wind
700 Coal
359 Coal
50 Wind
250 Coal
280 Wind
125 Wind
575 Coal
100 Wind
575 Coal
140 Gas
250 Wind
Added 345 kV Line
Modified Interface
Added Resource
Recommendation 1 Transmission Projects WY-CO Expansion (less gray)
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Area Production Costs (VOM) Recommendation 1
Area Costs ($Millions)
ID AreaReference
CaseNo Tx
Additions
If No Transmission Constraints
Build All Tx & Gen (Rec 1)
Montana Gen & Tx Only
JB Gen & Tx Only
WY/CO Gen & Tx Only
(a) (b) (c) (d) (e) (f) (g)1 New Mexico 482 447 470 451 465 462 459 2 Arizona 4,243 3,949 4,292 3,945 4,109 4,072 4,053 3 Nevada 1,226 1,239 1,215 1,170 1,170 1,144 1,208 4 WAPA- LC 503 461 513 458 482 478 469 5 Mexico- C 887 876 942 879 884 883 882 6 Imperial 22 19 15 18 19 19 19 7 San Diego 895 776 645 778 836 830 825 8 So. California 1,687 1,450 1,016 1,469 1,547 1,549 1,538 9 LADWP 357 300 199 287 318 304 310 10 IPP 253 253 253 253 253 253 253 11 PG AND E 3,595 3,531 2,807 3,312 3,447 3,405 3,502 12 Northwest 2,331 2,181 2,186 2,165 2,220 2,245 2,267 13 BC Hydro 585 548 554 532 555 556 563 14 Aquila 33 32 34 32 32 32 32 15 Alberta 1,453 1,435 1,743 1,432 1,442 1,444 1,445 16 Idaho- West 14 1 0 4 5 4 4 18 Montana- West - - - - - - - 19 Sierra 305 233 253 238 260 254 258 20 Wyoming- Central 50 69 76 76 50 50 76 22 Bonanza 69 68 69 68 69 69 68 23 Utah- North 213 147 173 162 180 172 178 24 Utah- South 370 403 461 430 446 446 435 25 Colorado- East 932 817 867 758 855 839 777 26 Colorado- West 200 200 200 200 200 200 200 28 Black Hills 77 64 66 61 68 64 64 29 LRS 83 76 83 83 83 83 83 30 JB 261 262 307 307 261 307 260 32 Broadview 17 34 37 37 37 17 17 33 CRSOVRCO 165 167 177 177 177 165 165
Total 21,306 20,039 19,654 19,780 20,470 20,345 20,409
- (1,268) (1,653) (1,526) (836) (961) (897)1,268 - (385) (258) 431 306 371
Delta from If No Tx Constraints 1,653 385 - 127 817 691 756
Delta from Reference CaseDelta from No Tx Additions
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Interface Performance Recommendation 1
Opportunity Cost ($)
% Time at Capacity
Opportunity Cost ($)
% Time at Capacity
Opportunity Cost ($)
% Time at Capacity
Opportunity Cost ($)
% Time at Capacity
Opportunity Cost ($)
% Time at Capacity
1 Black Hills to C Wyoming 260,628 84% - 0% - 0% - 0% - 0%2 TOT 3 234,016 73% 5,292 6% 5,643 7% 11,991 10% 525 1%3 BRIDGER WEST 229,411 74% 13,907 10% 7,380 10% 1,863 2% 41,353 26%4 WEST OF BROADVIEW 164,911 49% 7,353 6% 85 0% 288 0% 1,961 1%5 West of Naughton (E-S&W) 95,225 31% 617 0% 1,336 1% 187 0% 6,348 3%6 ALBERTA - BRITISH COLUMBIA 53,192 73% 48,445 70% 51,196 73% 51,456 73% 52,807 74%7 TOT 2C 45,734 27% 50,392 26% 17,579 18% 19,655 18% 37,686 24%8 North of Miguel 45,655 60% 42,370 64% 43,014 62% 43,538 64% 44,241 62%9 WOR -n- El Dor to Lugo 41,899 53% 44,122 60% 43,830 56% 46,553 59% 47,732 59%10 MONTANA - NORTHWEST 34,278 11% 17,343 10% 1,303 3% 1,878 3% 137 0%11 PATH C 26,309 10% - 0% 17,500 5% - 0% 16,613 6%12 BONANZA WEST 22,345 16% 12,619 9% 3,765 4% 968 2% 18,709 11%13 SOUTHERN NEW MEXICO (NM1) 18,680 26% 18,694 22% 15,942 18% 16,753 19% 16,957 20%14 Laramie River to C Wyomong 16,685 10% - 0% 170 1% 339 1% 1 0%15 Combined PACI & PDCI 11,133 19% 11,068 21% 7,812 18% 7,443 18% 6,521 17%16 NW to Canada, East BC 9,817 8% 12,740 9% 12,396 9% 13,459 9% 12,666 10%17 COI 6,587 52% 3,112 26% 1,653 19% 1,837 18% 1,863 23%18 East of Bridger 5,319 6% 4,283 2% - 0% 74 0% - 0%19 ARIZONA - CALIFORNIA 5,203 5,611 5,642 6,162 5,702 20 PACIFIC DC INTERTIE (PDCI) 5,105 1,952 3,576 2,222 3,091 21 CA INDEPENDENT - MEXICO (CFE) 5,047 5,427 6,528 6,369 6,168 22 IDAHO - NORTHWEST 4,365 8,328 10,109 8,184 7,569 23 TOT 1A 4,318 1,652 994 325 4,404 24 TOT 7 4,268 - 333 369 - 25 TOT 2B2 4,209 8,319 2,016 2,566 4,862 26 NORTHWEST - CANADA 3,591 3,304 1,383 1,467 1,292 27 IDAHO - MONTANA 3,178 3,630 5,455 3,248 4,330 28 Southern CA Imports 3,020 3,198 2,632 2,641 2,448 29 BROWNLEE EAST 2,815 6,896 10,210 6,871 8,535 30 Imp.Valley to Miguel 2,499 2,423 1,891 1,922 1,811 31 Montana - Southeast 2,332 1,150 49 4,743 5,225 32 NORTH OF SAN ONOFRE 1,755 1,760 2,520 2,480 2,546 33 MIDPOINT - SUMMER LAKE 1,669 4,473 7,001 7,580 8,624 34 TOT 2B1 1,480 - 1,996 64 3,389 35 INYO - CONTROL 115 KV TIE 1,440 1,374 714 308 2,071 36 SW Wyoming to N Utah 1,405 - 584 - 746 37 NORTHERN - SOUTHERN CALIFORNIA 1,351 1,132 599 1,004 620 38 TOT 2A 904 376 3 - 277 39 PAVANT, INTRMTN - GONDER 230 KV 433 352 686 621 649 40 SOUTHWEST OF FOUR CORNERS 414 413 - - 53 41 EOR - HASSYAMP- N.GILA 378 433 280 276 231 42 PG&E - SPP 319 1,305 1,184 1,454 1,238 43 TOT 2B 316 - 1,937 - 2,425 44 TOT 4A 261 - - - 141
Row JB Gen & Tx Only Wyo/Col Tx & Gen OnlyInterface Name
Add Gen, Add All TransmissionAdd Gen, No Tx Additions Montana Gen & Tx Only
20 RMATS Recommendations
Capacity Factors Recommendation 1
Capacity (MW)
If No Transmission
Constraints
Add Gen/ No new
TransmissionBuild All
Tx & Gen
Montana Gen & Tx
OnlyJB Gen & Tx
OnlyWY/CO Tx &
Gen OnlyNew CoalColorado 500 90.7% 90.7% 90.7% 90.7% 90.7% 90.7%Broadview 250 86.8% 86.8% 86.8% 86.8% 0.0% 0.0%Colstrip 250 87.7% 87.7% 87.7% 87.7% 0.0% 0.0%Utah 575 90.4% 90.4% 90.4% 90.4% 90.4% 90.4%Wyoming 700 87.4% 67.7% 87.4% 0.0% 0.0% 87.4%Jim Bridger 575 91.2% 91.2% 91.2% 0.0% 91.2% 0.0%
Existing CoalBonanza 420 89.9% 88.8% 89.3% 89.8% 89.9% 89.3%Cholla 995 89.9% 89.9% 89.9% 89.9% 89.9% 89.9%Colstrip 2,094 89.9% 84.1% 89.7% 89.9% 89.9% 89.9%Commanche 660 91.1% 91.1% 91.1% 91.1% 91.1% 91.1%Craig 1,264 89.9% 89.6% 89.8% 89.8% 89.9% 89.7%DJ 2 666 89.9% 88.7% 89.8% 89.9% 89.9% 89.9%DJ 1 106 89.9% 87.6% 89.8% 89.9% 89.9% 89.8%Hunter 1,315 89.9% 89.9% 89.9% 89.9% 89.9% 89.9%Huntington 895 89.9% 89.9% 89.9% 89.9% 89.9% 89.9%Intermountain 1,710 91.1% 91.1% 90.8% 91.1% 91.1% 91.1%Jim Bridger 2,110 92.2% 76.2% 92.0% 92.2% 92.2% 91.8%LRS 1,100 89.9% 81.7% 89.9% 89.9% 89.9% 89.9%Naughton 700 89.9% 86.9% 89.8% 89.8% 89.9% 89.8%Pawnee 495 89.9% 89.9% 89.9% 89.9% 89.9% 89.9%Wyodak 335 89.9% 89.9% 89.8% 89.9% 89.9% 89.8%
GasCurrant Creek* 665 92.3% 68.3% 79.5% 86.2% 86.2% 81.8%Nebo 147 100.0% 70.8% 90.5% 96.2% 96.1% 93.8%Colorado East 210 100.0% 87.6% 85.6% 93.6% 93.5% 85.9%West Valley 215 19.6% 12.8% 15.2% 21.8% 19.1% 21.7%Bennett Mountain 167 0.2% 1.5% 3.8% 4.8% 4.5% 4.0%ManChief 310 0.1% 4.4% 1.1% 2.4% 2.6% 0.7%Front Range 480 85.0% 51.9% 64.0% 71.8% 71.5% 65.5%
* (includes new S. Utah Unit)