NYCA Pipeline Congestion and Infrastructure Adequacy Assessment
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NYCA Pipeline Congestion and Infrastructure Adequacy Assessment New York Independent System Operator September, 2013 REDACTED 100 SUMMER STREET, SUITE 3200 BOSTON, MASSACHUSETTS 02110 TEL 617-531-2818 FAX 617-531-2826 LIMITATION ON LIABILITY This report has been prepared for NYISO for the sole purpose of assessing the adequacy of the natural gas infrastructure in regard to meeting the fuel delivery needs of gas-fired generation in NYISO. Input parameters to various models are based largely on actual public data from the pipelines and local distribution companies operating in New York State. Findings contained herein depend on the assumptions identified in our report, including the mathematical models used to determine historic congestion levels and flow balances over the study period. Levitan & Associates, Inc. believes these assumptions to be reasonable. However, there is no assurance that any specific set of assumptions associated with new pipeline and storage projects will be encountered. DISCLAIMER This report was prepared by Levitan & Associates, Inc. (LAI) for the New York Independent System Operator, Inc. (NYISO). The views and conclusions expressed in this study represent those of LAI and do not necessarily represent those of the NYISO. No official endorsement by the NYISO is intended or should be inferred. TABLE OF CONTENTS Introduction ................................................................................................................................... 1 Executive Summary ...................................................................................................................... 2 1 Market & Infrastructure Overview .................................................................................. 17 1.1 Pipeline Infrastructure .................................................................................................... 20 1.2 Supply Developments and Gas Prices ............................................................................ 31 2 Historical Congestion Review ............................................................................................ 37 2.1 Approach and Data Sources ........................................................................................... 37 2.2 Algonquin Gas Transmission System ............................................................................ 39 2.3 Empire Pipeline .............................................................................................................. 53 2.4 Iroquois........................................................................................................................... 58 2.5 Millennium ..................................................................................................................... 67 2.6 Tennessee Gas Pipeline .................................................................................................. 72 2.7 Texas Eastern ................................................................................................................. 86 2.8 Transco ........................................................................................................................... 93 2.9 Conclusions and Observations ....................................................................................... 99 3 Forecast of Infrastructure Adequacy .............................................................................. 104 3.1 Upstream Boundary Flows ........................................................................................... 104 3.2 Downstream Boundary Flows ...................................................................................... 124 3.3 In-State Receipts .......................................................................................................... 131 3.4 Core Demand................................................................................................................ 148 3.5 Non-Core Demand ....................................................................................................... 172 3.6 Infrastructure Adequacy Results .................................................................................. 175 3.7 Pipeline Capacity to Serve Generation on Peak Electric Days .................................... 184 3.8 Contingency Assessment.............................................................................................. 187 TABLE OF FIGURES Figure 1. Natural Gas Pipeline Network in NYCA ....................................................................... 3 Figure 2. Pipelines Serving the New York Facilities System ........................................................ 4 Figure 3. New York Facilities System Deliveries ......................................................................... 5 Figure 4. Heating Season Peak Day Pipeline Congestion (Current Infrastructure) ....................... 7 Figure 5. Cooling Season Peak Day Pipeline Congestion (Current Infrastructure) ...................... 8 Figure 6. Heating Season Boundary Flow Changes ...................................................................... 9 Figure 7. Cooling Season Boundary Flow Changes .................................................................... 10 Figure 8. Base v. +1,000-MW Case Non-Core Demand ............................................................. 11 Figure 9. Heating Season NYCA Flow Balance (Base Case) ..................................................... 12 Figure 10. Cooling Season NYCA Flow Balance (Base Case) ................................................... 12 Figure 11. Heating Season NYFS Flow Balance (Base Case)..................................................... 13 Figure 12. Cooling Season NYFS Flow Balance (Base Case) .................................................... 14 Figure 13. Contingency Locations [Redacted] ............................................................................ 15 Figure 14. Contingency Results – [Redacted] ............................................................................. 16 Figure 15. Summary of Contingency Results – [Redacted] ........................................................ 16 Figure 16. Marcellus Production.................................................................................................. 18 Figure 17. Marcellus Production on Tennessee ........................................................................... 19 Figure 18. Natural Gas Pipeline Network in NYCA ................................................................... 21 Figure 19. Heating Season Boundary Flow Changes .................................................................. 22 Figure 20. Cooling Season Boundary Flow Changes .................................................................. 23 Figure 21. Domestic Shale Gas Production ................................................................................. 31 Figure 22. Average Monthly Spot Prices ..................................................................................... 32 Figure 23. Average Monthly Basis for New York Gas Indices ................................................... 33 Figure 24. Daily Spot Prices, November 2012-January 2013 ..................................................... 34 Figure 25. Comparison of Spot Prices for Gas and Oil ............................................................... 35 Figure 26. Basis Swap Forward Curves ....................................................................................... 36 Figure 27. Algonquin Pipeline ..................................................................................................... 40 Figure 28. Daily Available Capacity and Throughput at Hanover .............................................. 41 Figure 29. Comparison of Temperature and Throughput for Hanover ........................................ 42 Figure 30. Daily Capacity and Throughput at Stony Point .......................................................... 44 Figure 31. Comparison of Temperature and Throughput for Stony Point ................................... 45 Figure 32. Daily Capacity and Throughput at Southeast ............................................................. 47 Figure 33. Comparison of Temperature and Throughput for Southeast ...................................... 48 Figure 34. Distribution of Utilization Rates on Algonquin ......................................................... 49 Figure 35. Distribution of Utilization Rates on Algonquin, Winter Only ................................... 50 Figure 36. Plot of Temperature vs. Utilization on Algonquin Segments..................................... 52 Figure 37. Empire Pipeline .......................................................................................................... 53 Figure 38. Daily Available Capacity and Throughput for the Empire Connector ....................... 54 Figure 39. Comparison of Temperature and Throughput for the Empire Connector .................. 55 Figure 40. Distribution of Utilization Rates on Empire ............................................................... 57 Figure 41. Distribution of Utilization Rates on Empire, Winter Only......................................... 57 Figure 42. Iroquois Pipeline ......................................................................................................... 59 Figure 43. Daily Available Capacity and Throughput at Waddington ........................................ 60 Figure 44. Comparison of Temperature and Throughput for Waddington .................................. 61 Figure