Transcript Project Management - American Public Power Association

Selecting Renewable Projects at
Colorado Springs Utilities
APPA Conference
John Romero
GM Acquisition, Engineering and Planning
October, 2009
Overview
• Overview of Colorado Springs Utilities
• What is Driving Renewable Investment
• Which Projects and Why
• Challenges with Renewables
• Summary
Overview of Colorado Springs Utilities
•Four Service Utility
•500,000+ Combined Customers
•863 MW Peak (2007)
•200,000+ Electric Customers
Front Range
What is Driving Renewable Investment?
• Colorado Renewable Portfolio Standard (RPS)
• Customer Desire for Renewables
• Potential Environmental Legislation
• American Recovery and Reinvestment Act (Stimulus)
What is Driving Renewable Investment?
Colorado Renewable Portfolio Standard
Investor Owned Utilities
2008-10
2011-14
2015-19
2020
•
•
•
•
•
5%
10%
15%
20%
Munis/Co-ops
1%
3%
6%
10%
Renewable energy: solar, wind, geothermal, biomass, landfill gas, animal
waste, hydropower, recycled energy and fuel cells.
IOU’s must generate at least 4% of the requirement from solar with one-half
coming from customer on-site generation
No solar requirement for munis/co-ops
300% RPS credit per MWH for solar before July 1, 2015
125% RPS credit per MWH for Colorado generated renewable energy
Percentage based on retail electric sales
What is Driving Renewable Investment?
Customer Desire for Renewables
• General Desire
• 76% of customers express a willingness to pay $1 - $2 more per
month to add wind to the resource mix
• Business Customers
• Universities/small commercial requesting additional “green” power
• Military Bases
• Stimulus Money
• Net Zero Energy Users by 2020
What is Driving Renewable Investment?
Potential Environmental Legislation
• Waxman-Markey
• Clean Energy
• Renewable Energy and energy efficiency: 6% in 2012 rising to 25%
in 2025
• Carbon Capture and Sequestration
• Smart Grid
• Global Warming
• CO2 reductions from 2005 levels: 3%:2012, 17%:2020, 42%:2030
and 83%:2050
What is Driving Renewable Investment?
American Recovery and Reinvestment Act
(Stimulus)
• $11 billion for a smarter grid
• $5 billion for low-income home weatherization projects
• $4.5 billion to green federal buildings
• $6.3 billion for state and local renewable energy and energy
efficiency efforts
• $600 million in green job training programs
• $2 billion in competitive grants to develop energy storage
Which Projects and Why?
• Renewable Energy Credits (RECs)
• Solar
• Wind
• Hydro
• Biomass
Source: NREL May 2009
Fuel Cell
Nuclear
Coal
IGCC
CCGT
CT
MSW - Landfill
Gas
Geothermal
Biomass
Hydro
Hydropower
(new)
Wind Offshore
Wind
Tidal
Solar Thermal
Wave
Solar PV
Capacity Factor
Fuel Cell
Nuclear
Coal
IGCC
CCGT
CT
MSW - Landfill
Gas
Geothermal
Biomass
Hydro
Hydropower
(new)
Wind Offshore
Wind
Tidal
Solar Thermal
Wave
Solar PV
Overnight Costs (2006$/KW)
$8,000.00
$7,000.00
$6,000.00
$5,000.00
$4,000.00
$3,000.00
$2,000.00
$1,000.00
$-
1.00
0.90
0.80
0.70
0.60
0.50
0.40
0.30
0.20
0.10
0.00
Which Projects and Why?
Renewable Energy Credits
• Five Year Contract with Western Area Power
Administration (2006 – 2010)
• Purchase of over 1.5M RECs
• Price: $2.49 / MWh
• Assured Compliance through 2018
• Value Proposition of $100M+ over Alternatives
Which Projects and Why?
Wind
• Issued RFP for 10 – 100 MW of Wind
• 14 Respondents, 4 Finalists, Recommendation of Award
in June 2009
• Wind Integration Study: 50 MW Limit
• Contract Negotiations for Delivery in 2011
Which Projects and Why?
Solar
• United States Air Force Academy (USAFA) Stimulus
• $18.3 Million to Provide Solar Service
• 2 – 4 MW of Capacity
• Working with USAFA to Meet Military Renewable
Objectives
Which Projects and Why?
Hydro
• Cascade Hydro
• 850 KW
• 2009 Online Date
• Finished Water Micro Turbines (evaluation stage)
• USAFA Project
Which Projects and Why?
Biomass – Co-firing
• 20 MW co-fire at Drake Coal Facility
• Reduced Coal Burn of 75,000 tons
• 150,000 MWh of Production
• Grants (applications)
• USDA Woody Biomass Grant ($250,000)
• Cooperative State Research Education and Extension Service ($5
Million matching)
Challenges with Renewables
• Costly Compared to Traditional Resources (at least, for
now)
• Typically Low Capacity Factors
• Intermittent
Summary
• Renewables Driven by:
•
•
•
•
Legislation
Customer Desire to be “Green”
Desire to be Environmentally Friendly
Resource Portfolio Diversity
• Project Selection
• Cost
• Customer Directed
• Integration
• Changes to Dispatching Resource Mix