Transcript 2003 CEMU/Key messages: demand

Energy: What Every Corporation
Should Know About Reliable,
Renewable and Distributed Generation
2004 Bren School Corporate Partners Summit
Bill Bryan, Vice President
May 14, 2004
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1
Supply Outlook from the
California Energy Commission
65,000
Cold Reserve Capacity
63,000
Emergency Response Programs/
Interruptables
61,000
Spot Market Imports
Megawatts
59,000
High Probability Additions- Only counts
plants deemed 75% or better chance of
being built
57,000
55,000
Net Firm Imports
53,000
Existing Generation (reflects adjustments for
retiring units and both forced & planned
outages)
51,000
1-in-10 Summer Temperature Demand (Hot)
1-in-2 Summer Temperature Demand (Normal)
49,000
1-in-10 Summer with 7% Spinning Reserves
Added by SCE
47,000
1-in-2 Summer with 7% Spinning Reserves
Added by SCE
45,000
2004
2005
2006
2007
Year
2008
2009
2010
Source: California Energy Commission Electricity Demand and Supply Outlook,
Assembly Utilities and Commerce Committee, January 15, 2004.
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SCE 2004 Projected Power
Procurement Portfolio
SCE-owned
(31-37%)
CDWR
(28-34%)
QF/Other Contracts
(28-34%)
Market Purchases
(0-5%)
NOTE:
Percentages based on SCE’s January 2004 forecast, 2003 GRC Request, and 2004 DWR Interim Revenue Requirement
Decision (D.04-01-028).
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SCE’s Current1 Power Content Label
POWER CONTENT LABEL
ENERGY
RESOURCES
Eligible Renewable
- Biomass & waste
- Geothermal
SCE
POWER MIX
2002 CA
POWER MIX*
(projected)
(for comparison)
19%
9%
2%
11%
3%
4%
- Solar
1%
1%
2%
<1%
- Wind
Coal
4%
11%
<1%
15%
Large Hydroelectric
Natural Gas
4%
49%
23%
42%
17%
<1%
100%
11%
<1%
100%
- Small hydroelectric
Nuclear
Other
TOTAL
2
* Percentages are estimated annually by the California Energy
Commission based on electricity sold to California consumers during
the previous year.
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1 April
2
2004 Bill Insert.
Small hydroelectric includes facilities 30MW.
4
SCE’s View On Distributed
Generation
 SCE supports cost-effective customer choice
 Rate designs should not distort customer DG choices
 Interconnection process should be simple and
inexpensive, consistent with ensuring adequate
reliability, protection for utility assets and
public/employee safety
 Subsidies should be explicit, and consistent with
California’s adopted policy objectives
 SCE utilizes DG as a distribution planning option
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Reliable Electric Service Act of 2004
AB 2006 (Nuñez)
 Creates a clear, durable regulatory framework to stimulate
much needed investment in efficient, cost-effective,
environmentally sustainable supply and demand resources
 Affirms the utility obligation to provide reliable, reasonably priced
electric service
 Provides for the recovery of reasonable investments
 Stabilizes the customer base (core / non-core)
 Resource adequacy requirements and public policy preferences
apply equally to all load serving entities
 Integrated resource investment plan
 Resource selection process to achieve “best value” for customers
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Summary
 Supply looks tight in the future
 AB 2006 provides a durable regulatory
framework for investment in our electrical
infrastructure
 SCE is committed to renewables and
alternative sources of energy
 Electricity is different
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Backup
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What’s on the Horizon?
 New Economic Development Rate (EDR) Proposal
 SCE 2003 General Rate Case
 DWR Power Contracts
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Potential System Average Rate1
Impact of 2004 Rate Actions
Post-PROACT
Rate Reduction
08/01/2003
2004 Final
DWR Rev Req’t
2003 GRC Phase II
 2 – 3%
2003 GRC Phase I
and ERRA
Impacts Vary
2004 Interim
DWR Rev Req’t
Forecasted 2004 Impact
2004 DWR Rev Req’t (Net)
2003 GRC Phase I
+2 to 3%2
ERRA
1 Impacts
2
shown are estimates for Bundled Service Customers. Actual rates will depend on market conditions and actions by the California Public Utilities Commission (CPUC).
Estimated System Average Increase, based on 2004 Sales Forecast.
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