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ANTONIO R. VILLARAIGOSA Commission RO\TALD F. DEATON, General Manager Mayor H. DAVID NAHAL f'resideni EDITH RAMIREZ, Vice Pres/dent MARY D. NICHOLS KICK PA:lSAOURAS FORESCEE HOGAN-ROWLES BARBARA E. MOSCHOS, Secerary
November 9, 2007
The Honorable City Council c/o Office of the City Clerk Room 395, City Hall Mail Stop 160
Attention: Councilmember Jan Perry Chair, Energy and the Environment Committee
Honorable Members:
Subject: Council File NO.00-1531 - Draft 2007 Integrated Resource Plan
Enclosed for your information is the Los Angeles Department of Water and Power's (LADWP) Draft 2007 Power System Integrated Resource Plan (IRP). A 2006 draft IRP has been posted on the LADWP website since March 2006, and the 2007 IRP will also be posted for final public review. We intend to seek approval from the Board of Water and Power Commissioners in December 2007.
If you have any questions or require additional information, please contact me at (213) 367-4333, or Mr. Enrique Martinez, Chief Operating Officer -Power System at (213) 367-4435; or have a member of you r staff contact Mr. Brian Koch, Manager of Resource Development, at (213) 367-0054, or Ms. Winifred Yancy, Governmental Affairs Representative at (213) 367-0025. ~/-~/Sincerely, Robert K. Rozanski .NV 2 720i Acting General Manager ENERGY & ENVIRONMENT gb Enclosure c/enc: Mr. Enrique Martinez Mr. Brian Koch Ms. Winifred Yancy
Water and Power Conservation... a way of life 111 ~orth Hope Street, Los Angeles, California 90012-2607 Mailing address: Box 51111, Los Angeles 90051-5700
Telephone: (213) 367-421 1 Cahle address: Recalanmadefrreedwa.DEWAPOLA 'CçY rf 2007 INTEGRATED RESOURCE PLAN
City of Los Angeles Department of Water and Power
Ronald F. Deaton General Manager
(g (g b\ IF U November, 2007 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
-, TABLE OF CONTENTS 1.0 Executive Summary ...... I ., 1.21.1 IntroductionOverview II I1.3 .4Summary Background of2007 IRP Recommendations 3 2 1.51.6 Renewable2000 IRP Accomplishments Portfolio Standard 54 2.0 IRP2.1 Objectives...... Rcliable ...... Service ...... 8 8 2.32.2 Environmental Competitive Leadership Price II 9 3.0 Integrated3.23.1 Resource Key Introduction Planning...... Assumptions 13 13 13 3.43.3 Load SystemForecast Reserve Margin 14 15 3.5 Summary of Loads and Resources 16 3.6 Environmental Achievements and Goals 22 4.0 Recommended4.1 Recommendations Strategies...... 25 25 4.34.2 Details Summary ofthc and Recommendations Conclusion 4526
APPENDICES Appendix A: Generation Resources...... A-I Appendix B: Load Forecasting...... B-1 Appendix C: Environmental Issues...... C-I Appendix D: Renewable Portfolio Standard...... D-I Appendix E: Energy Effciency and Demand Side Management...... E-l Appendix F: Distributed Generation...... F-I Appendix G: Fuel Procurement Issues...... G-I Appendix H: Transmission System...... H-I Appendix I: Glossary...... ,...... I-I
November, 2007 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
1.0 EXECUTIVE SUMMARY
-, 1.1 Overview
The purpose of this 2007 Intcgratcd Rcsourcc Plan (IRP) is to providc a framework to assure that
the future energy needs of the customers of the Los Angeles Department ofWatcr and Powcr (LADWP) are reliably met at the least cost, and are consistent with the City of Los Angeles' commitmcnt to cnvironmcntal cxccllcncc. Thus, thc major objectives of this IRP are to confirm that LADWP will continue to:
I. Providc Rcliablc Scrvicc to our Customers 2. Remain Committed to Environmental Lcadcrship 3. Maintain a Competitive Price
It is the overrding purpose of this IRP to intcgratc and harmonizc thcse three objectives.
This 2007 IRP is based on the October 2006 Load Forecast (Load Forecast), but will also take into account a variety of othcr factors which influcncc LADWP's operations. The Southwest and the greater Los Angeles areas continue to grow and consume more electricity. Loads in Los Angeles have grown at a steady, moderate pace since the 1994 Northridge earthquake with an avcrage long-tcrm growth ratc of about 1.4 pcrcent per year. The Load Forecast predicts that electricity consumption within LADWP's service terrtory will increasc at an avcragc ratc of 0.9 percent per year, and the peak demand will increase at an average of 60 megawatts (MW) per ycar for thc forcsccable futurc.
Other major factors influencing this 2007 IRP are the aggressive goals that LADWP has to significantly reducc grccnhousc gas (GHG) cmissions, incrcasc its portfolio of renewable energy, and establish customer programs to promote energy effciency. These goals ineludc rcducing GHG emissions to 35% below 1990 levels by 2030, increasing renewable energy to 20% of energy sales by 2010 and to 35% by 2020, and tripling its invcstmcnt in energy efficiency and conservation programs from previous years.
1.2 Introduction
The LADWP last issued an IRP in 2000, during a period when significant changes were being madc to thc structurc and rcgulation ofthc electric utility industry in California. In 2000 and 2001, rolling blackouts affected system reliability, and wholesale priccs for elcctricity in California and the West skyrocketed. Fortunately, LADWP's customers were shielded from the
majority of these events because ofLADWP's prudcnt planning and preparations.
November, 2007 I Los Angeles Department at Water and Power 2007 Integrated Resource Plan
In 2002, California shifted its electric utility industry emphasis from deregulation to decreasing its dependence on fossil fuels. Senate Bill (SB) i 078 implemented a Renewable Portfolio Standard (RPS), with a goal of providing 20% of the energy sold to customers to be generated using eligible renewable resources by 2017. SB 1037 was passed in 2005, which mandated a loading order that prioritizes the effcient use of energy and demand reduction programs. Also in 2005, the California Energy Commission's lntegrated Energy Policy Report stated a goal of accelerating the RPS to achieving the 20% goal by 2010. The California Governor, in the 2005- 06 Budget Summary, additionally included a goal of achieving 33-perccnt rcncwablcs by 2020 for the State as a whole.
In 2006, LADWP issued a draft IRP for public review and comment. This 2007 IRP incorporates stakeholder feedback that was received and other important regulations and policies that governing authorities have recently approved.
1.3 Summary of the 2007 IRP Recommendations
LADWP has made significant progress in achieving many of the goals set out in the 2000 lRP.
As LADWP is now aggressively pursuing a RPS policy of achieving 20% renewables by 2010 and 35% by 2020, LADWP needs to consider how its financial and workforce resources will best be utilized and the 2007 IRP accordingly has significantly different approaches and recommendations than the 2000 IRP. The 2007 IRP will prioritize the loading order of energy effciency and demand-side management programs, increase the development and addition of renewable resources, reduce GHG emissions, and address the needs of tbe power system generation, transmission and distribution infrastructure to ensure its reliable operation.
A summary of the recommendations of the 2007 IRP arc outlined bclow: 1) Increase the level of commitment and funding to Customer Energy Efficiency, Demand Side Management and Solar Rooftop Programs and identify opportnities to enhance and expand these programs. 2) Aggressively pursue the Renewable Portfolio Standard goals of having 20% of LADWP's customer's energy needs met by renewable sources of energy by 2010, with a longer term goal of 35% by 2020. The portfolio of renewable energy projects will be diversified by location and technology. LADWP will give preference to projects that are located within the Los Angeles region and are owned and operated by LADWP to further support LADWP's economic development and system reliability objectives. 3) Provide specific steps needed to achieve the reduction ofGHG emissions to 35% beíow i 990 levels by 2030. Additionally, LADWP will adhere to the climate change legislation California signed into law in 2006, including SB 1368: The Greenhouse Gas Emissions
Performance Standard, and Assembly Bill (A B) 32: The California Global Warming Solutions Act. 4) Provide specific actions to be taken to successfully integrate renewable generation resources into the power system while maintaining power system reliability.
November, 2007 2 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
5) Establish programs to cnhance and expand electric transmission resources, particularly in gaining access to renewable energy resourccs. 6) Repower additional in-basin generation consistcnt with power system needs and environmental requirements. 7) Ensure that the power generation, transmission and distribution infrastructure operates in a rcliable and efficient manner. A Power Reliability Program initiated in 2007 will improve maintenance practices, address the aging power system infrastructure, increase capital programs necessary to support load growth, and incrcase staffing levels to support reliability related work.
Thcsc rccommendations are tully addressed in Section 4.
As LADWP proceeds with these IRP recommendations, the following assumptions will also he adhered to: . LADWP will continue to be sclf-suffcicnt, by maintaining system generation resources equal to or greater than its customer's electrical needs. . LADWP will provide suffcient generation to cover operating and replacement rcserves in accordance to applicable fedcral and regional reliability requirements. . LADWP will maintain full control of its transmission asscts and will continue to augment thosc assets commensurate with load growth and renewable energy opportnitics. . LADWP will participate jointly with the Los Angelcs Dcpartment of Public Works, Bureau of Sanitation to develop solid waste energy conversion projccts. . LADWP will participate jointly with the Los Angeles Department of Public Works to evaluate the feasibility of utilizing wastcwater effuent from the Hyperion Wastewater Treatment Plant to provide cooling for the neighboring LADWP Scattcrgood Generating Station in licu of occan water cooling. . Thc LADWP Power System will work with the Water System to develop programs that reduce the usage of elcctricity and conserve water, as well as optimizing hydroelectric cncrgy production.
1.4 Background
LADWP's power system serves approximately 4 million pcople, and is the nation's largest municipal utility. LADWP's all time peak demand was 6,165 MW which occurred in July 2006, and has an installed generation capacity of7,331 MW. Its service territory covers the City of
Los Angelcs and many areas of Owens Valley, with annual sales exceeding 24 million MW-
hours (MWh). It is a "vertically intcgrated" utility, both owning and operating the majority of its gencration, transmission and distribution systems.
November, 2007 3 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
One of the guiding principles under which LADWP operates is the obligation to serve its customers, as stated in the current Los Angeles City Charter.
"The Department of Water and Power has the power and dutv (emphasis added): 1) to construct, operate, maintain, extend, manage, and control water and electric worh and property of the benefit of the City and its inhabitants... (Sections 220 and 675 of the Los Angeles City Charter). "
In other words, LADWP must have sufficient capability to provide its customers with a reliable supply of electric power. LADWP strives to be self-suffcient in providing cleetricity to its customers, and does so by maintaining generation resources which are equal to or greater than its customers' electrical needs. It should be noted that while LADWP does participate in the wholesale electric market to both sell excess power and purchase power economically, it does not rcly on this wholesale market in serving the electrical needs of its customers.
1.5 Renewable Portfolio Standard
As discussed in Section 1.2, California has shown environmental leadership by instituting aggressive renewable energy goals. In 2006, California also signed into law AB32: The California Global Warming Solutions Act, and SB 1368: The Greenhouse Gas Emissions Performance Standard. These bills require that California's statewide greenhouse gas emissions be reduced to 1990 levels by 2020, and also restrict greenhouse gas emissions for new baseload power plant generation to be no higher than the rate of emissions for combined-cycle natural gas bascload generation, respectively.
LADWP has also been proactive in pursuing its goals of environmental leadership. Examples of significant environmental achievements include:
. In May 1999, LADWP implemented the Green Power for Green LA program to increase renewable energy resource development and procurement through voluntary contributions by its customers. . In August 2000, LADWP adopted an IRP that recommended the repowering of 10
Los Angeles Basin generating units, the installation of Oxides of Nitrogen (NOx) emission controls, and the implementation of several renewable resource related programs and
projects. Other goals included meeting 50% of projected load growth using Dcmand-Side Managcmcnt (DSM), Distributcd Gcneration, and Renewable Resources. . In 200 i, LADWP issued its first Request for Proposals (RFP) for Rcncwablc Rcsources. The 120 MW Pinc Trcc Wind Projcct was one of the projects resulting trom this RFP.
. In 2003, thc Mayor and the City Council took several steps toward developing a new
Rcncwables Portfolio Standard for LADWP. This included the creation of the Green Ribbon
November, 2007 4 Los Angeles Department of Watcr and Powcr 2007 Integrated Resourcc Plan
Commission by thc Mayor, and convening a Renewable Encrgy Summit by the Commerce, Energy and Natural Resourccs Committee.
. In 2004, the Los Angeles City Council adoptcd a LADWP Renewables Portfolio Standard , ~ Framcwork that requested the Board of Water and Powcr Commissioners "to adopt a Renewables Portfolio Standard of20 percent renewable energy by 2017 sctting applicable milestones to achieve this goal".
. In Junc 2004, LADWP issued a second RFP for Rcnewable Resources. The intent of this RFP was to obtain a sufficient amount of renewable energy pcr ycar to achieve the interim RPS goal of 13% by 2010.
. In June 2005, thc City Council approved the City of Los Angclcs Department of Water and Power's Rcncwables Portfolio Standard Policy, which was dcsigned to provide 20% of its energy sales to retail customcrs from eligible renewable resources by 2017, with an interim goal of i 3% by 2010.
. In December 2005, thc LADWP Board of Water and Power Commissioncrs recommended that LADWP accclcratc its RPS goal to obtain 20% renewables by 2010. This was approved by resolution in April 2007.
. In January 2007, LADWP issued a third RFP for Renewable Resourccs. The intent of this RFP was to obtain a sufficient amount of renewable energy pcr ycar to achieve the RPS goal of20% by 2010. . In May 2007, Los Angeles Mayor Antonio R. Villaraigosa sct scvcral ncw goals for the City
of Los Angeles and for thc LADWP. These goals include reducing the City of Los Angeles' grccnhouse gas emissions to 35% below 1990 Icvcls by 2030. Additional goals for LADWP
include incrcasing the use ofrenewable energy to 35% by 2020, and no renewal of power contracts from coal-fired plants.
Additional information rcgarding LADWP's Renewable Portfolio Standard is found in
Appendix D of this document, and information regarding LADWP's Energy Effcicncy, Dcmand Sidc Managcment and Distributed Generation programs arc found in Appendices E and F, respectfully.
1.6 2000 IRP Accomplishments
Significant progress has bccn made in implementing the goals of the 2000 IRP since its approval
by the Board of Water and Power Commissioncrs and the Los Angeles Ciiy CounciL. Somc of the key goals that wcrc achieved are listed below:
. Selective Catalytic Reduction (SCR) cquipment to reduce NOx emissions has bccn installed on all natural gas-fired generating units in the Los Angclcs area. . Two combined cycle generating units havc bccn installed in the Los Angeles area replacing oldcr units that were taken out of service. Thesc combined cycle units include a 533 MW plant at the Valley Gcncrating Station, and a 575 MW plant at Hayncs Gcncrating Station.
November, 2007 5 Los Angeles Departmcnt ot Watcr and Powcr 2007 Intcgratcd Rcsourcc Plan
Thc SCR installations, combined with the two much cleaner and more efficient repowerings, have resulted in a 90% rcduction in NOx cmissions sincc 1989. Also, since the combined cycle units are about 30% to 40% more effcient than the units they replaced, about I, I 00 MW can now be generated with the same amount of natural gas that was previously required to generate about 600 MW. Additionally, CO2 cmissions from these units have bccn reduccd by 30% to 40% as a result of these repowerings.
. Six natural gas combustion turbinc pcakcr units totaling 280 MW have bccn install cd in the
Los Angeles area. Thesc quick-start pcaking units arc us cd to provide reliable sources of
electricity during periods of peak demand. Five of the units are located at Harbor Gcncrating Station, and one unit is located at Valley Generating Station. . A 80 MW capacity upgrade and life extension projcct for the Castaic Pumped Storage Power Plant is under construction. To date, three of the six main units have been upgraded.
. 176 MW of peak load reduction has been achieved through conservation and energy effciency programs from July 2000 through June 2006. Energy savings are estimated at 370 gigawatt hours (GWhs) over this same period. . Over twenty-two thousand LADWP customers are participating in LADWP's Green Power for a Green LA Program, receiving approximately 62 GWhs ofrenewable energy resources annually.
. LADWP has installed approximately 4 MW of Distributed Generation consisting of microturbines (2 MW), fuel cells (I MW) and photovoltaics (1 MW), and supported customer installations of 10 MW of photovoltaics sincc 2000. . One-half of LADWP's interest in the coal-fired Mohave Generating Station was sold in 2001. Thc entire Mohave plant was shut down on December 31,2005.
Other significant accomplishments which were not directly related to the 2000 IRP include:
. Construction was completed on the upgrade of the Sylmar Converter Station, which is the
tcrminus of the 3,100 MW Pacific Direct Current High Voltage Intertie system. This upgrade increases the reliability of this major transmission system. . LADWP is developing the 120 MW Pine Tree Wind Farm, located north of Mohave, California. Construction is schcduled to bc completcd in mid 2009. . Construction was complcted for the automation and life cxtension of the San Francisquito Power Plant, a hydroelectric plant on the Los Angeles Aqueduct which was built in 1920. This pïûject aSSüïes that this reliable sûürce ofrene\\rable poweï will continüe to be süpplied to Los Angclcs. . A varicty of programs designed to address LADWP's aging transmission and distribution infrastructurc havc been implemented, including the installation of load banks at distribution and receiving stations, replacing underground cables and circuit breakers, and the installation of a Supcrvisory Control And Data Acquisition (SCADA) system related to the automation
November, 2007 6 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
of over 175 substations. As mentioned in Recommendation 7, a Power Reliability Program has been established to manage future infrastructure replacement projects. . LADWP has encouraged the installation of over 10 MW of customer installed renewable solar photovoltaic systems and will be modifying the program in 2007 to comply with the California Solar Initiative with a goal to install an additional 270 MW of systems by 2017. . LADWP has been maximizing the usage of its transmission resources by selling excess capacities via the Open-Access-Samc-time-Infonnation System (OASIS), which is an electronic transmission service reservation system. . LADWP formed an Executive Risk Policy Committee with senior management as members to provide oversight over energy risk management activities. . LADWP developed a natural gas procurement strategy that ineluded a financial hedging program and the potential for acquiring gas fields. Fiscal year 2003-2004 was the first complete year for using financial hedging to cap gas prices over a portion of the forecasted gas requirements. In 2005, LADWP led the acquisition of a large natural gas field in the
Pinedale area of Wyoming.
November, 2007 7 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
2.0 IRP OBJECTIVES
The major objcctivcs of this 2007 IRP are to confirm that LADWP will continue to:
4. Provide Reliable Service to our Customers 5. Remain Committed to Environmental Leadership 6. Maintain a Competitive Price
As an integral part of each ofthese objectives, employec safety is considered as LADWP's highest priority. Each of these major objectives will be planned and implemented in such a fashion as to prioritize the safety for the public and for each employee.
2.1 Reliable Service
Reliability of the electric power system is dependent upon two elements: "resource adequacy" and "security." Resource adequacy refers to the availability of sufficient generation and transmission resourccs to mcet customcr's projectcd cnergy necds plus reservcs for contingencies. Security refers to the ability of the system to remain intact after experiencing sudden disturbances, outages or equipment failures.
LADWP, as part of the electric power grid of the western United States and Canada (and a small section of northern Mexico), is required to meet operational, planning reserve and reliability criteria, and the resource adequacy standards of the Western Electricity Coordinating Council (WECC) and the North American Electric Reliability Corporation (NERC). These standards define thc system reservc margin rcquirements (sce Section 3.4) and other criteria for which LADWP must plan and operate. LADWP has, and intends to continue meeting the requirements of these organizations.
System security issues also include terrorism and sabotage. These considerations are addressed through prcvcntive actions as well as systcm design and opcrational measures. Preventive actions such as expanded surveillance and patrol of power system facilities are undertaken by LADWP to safeguard the security and reliability ofLADWP power system. In addition, providing robust system designs and implementing conservative operating procedures are some of the actions recommended by this 2007 IRP.
LADWP has located a significant amount of generating resources within the Los Angeles area
(wcst of the San Andreas fault zonc), totaling 4,618 MW capacity out ofa total of7,323 MW. By locating these generation sources within LADWP's service territory, it ensures that LADWP can produce electricity in the evcnt of potential eartquakes or other situations that could intenupt LADWP's transmission system from importing power from external sources. Additionally, LADWP's new combined cyelc and peakcr plants which normally operate on natural gas also have a supply of backup fuel for use in emergency situations.
November, 2007 8 Los Angeles Department of Watcr and Power 2007 Integrated Rcsourcc Plan
A varicty of programs have been designed to address LADWP's aging transmission and distribution infrastructurc, including the installation of load banks at distribution and receiving stations, replacing underground cables and circuit breakers, and the installation of a Supcrvisory Control And Data Acquisition (SCADA) system relatcd to thc automation of over 175 substations. Thesc programs are designed to support and maintain the reliable operation of LADWP's power system. This IRP recommends that a comprehensive Power Reliability Program be implcmcnted to manage and coordinate the replacement and maintenance of aging equipment to reduce outagcs, and to provide sufficient levels of staffng to achieve this goal in a timely manner. Section 4.2 will provide additional dctails regarding this recommendation.
2.2 Environmental Leadership
This 2007 IRP reiterates LADWP's strong commitment to environmental excellence. LADWP's
concerns go beyond compliance with environmental laws and rcgulations. LADWP has
developed and implemented a large variety of programs and customer incentivcs (scc Appendices C, D and E for further descriptions) that serve as the blueprint and vision for improving the quality of life for the citizens of Los Angeles. Publicizing these programs will contribute to educating the public and garnering support for these environmentally responsible initiatives.
LADWP's Renewablc Portfolio Standard policy, as described in Appendix D, also demonstrates its commitment to changing the way it gcncratcs electricity, in shifting its generation portfolio to a morc environmentally sustainable mix. This policy strivcs to decrease NOx and GHG emissions and diversifying thc locations and types of renewable technologies, thercby reducing its impact on land use, air quality and global warming.
The 2000 IRP recommendcd specific plans to reduce emissions, ineluding installing SCR devices designed to reduce LADWP's emissions of NO x from the in-basin generating units and thus contributing to cleaner air in Los Angeles. LADWP installed statc-of-the-art SCR NOx emissions control equipment on Hayncs Generating Station unit 6, and on Scattergood Gcnerating Station units 1,2 and 3 in 2001 and 2002. Thcsc controls were in addition to five SCRs that were installed in LADWP system previously, and now all ofLADWP's Los Angeles area generating stations are equipped with such tcchnology. LADWP has reduced its NOx cmissions by at least 90% through the use of SCR technologics.
The 2007 lRP illustrates LADWP's leadership role with rcspcct to environmental issues by
establishing goals of both rcducing GHG emissions to 35% below i 990 levels by 2030, and providing 35% renewable energy to its customers by 2020. This exceeds California's goals of reducing GHG cmissions to 1990 levels by 2020, and providing 33% renewable energy by 2020. The following past and future actions wil assist LADWP in meeting these goals:
Novcmbcr,2007 9 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
1) The divestiture of LADWP's power purchase agreement of 100 MW from the coal- fired Colstrip generating station in 2000. 2) The divestiture in November 2001 of 50% of LADWP's interest in the coal-fired Mohave Generating Station, and its shutdown on December 31, 2005. 3) Effciency upgrades made at the coal-fired lntermountain Generating Station (IGS) have improved fuel effciency and increased electrical output, leading to a 2.5%
reduction in the plant's CO2 intensity as measured in tons of CO2 emitted per MWh. 4) Combined cycle units have been installed at the Harbor, Valley and Haynes Generating Stations. These combined cycle units arc about 30% to 40% more fuel effcient than the units they replaced and also use advanced technology to reduce NOx emissions.
5) LADWP has set an accelerated RPS goal of having 20% of its energy needs met from renewable resources by 2010. Section 3.5 will show that by implementing this goal, LADWP's energy from coal resources will be reduced from 47% to 43% between 2006 and 20 I 0, and natural gas usage will be reduced from 30% to 22%. 6) LADWP has ongoing and new programs that promote energy efficiency and conservation, such as providing incentives for customers to purchase and install high- efficiency lighting and appliances, encouraging ef1cient design of new buildings and tree planting. These and other energy effciency, demand-side management and distributed generation programs are discussed further in Appendix E and F. 7) Installation of generating turbines and purchasing energy from landfill facilities, which use methane gas extracted from the landfills to generate electricity. It is estimated that these projects will reduce CO2 emissions by approximately 50,000 tons per year. 8) Similar in concept to landfill gas-to-energy, methane gas is produced as a byproduct of the wastewater treatment process. Such reclaimed methane is extracted from the City's Hyperion Treatment Plant, and then piped to LADWP's neighboring Scattergood Generating Station where it is converted into electrical power. It is estimated that this project reduces CO2 emissions by approximately 99,000 tons per year. 9) LADWP's Green Power for a Green LA program provides 62 GWhs ofrenewable (low or non-C02 producing) energy per year to its program participants, thereby avoiding approximatcly 40,000 tons of CO2 emissions annually. i 0) LADWP manages and funds a Public Benefits Program, which contributes to the reduction of CO2 and other greenhouse gases. These programs include offering incentives for installing solar photovoltaics, energy effciency upgrades, and fuel cell projects. í l) LADWP implemented a "Trees for a Green LA Program", designed to improve air quality and lower energy use by providing shade, and also to beautify the community. Together with LADWP's reforestation program, over 80,000 trees have been planted in the Los Angeles area, leading to the sequestration of approximatcly 7,500 tons of equivalent CO2 annually. 12) LADWP operates a large fleet of over 100 electric vehicles (EV s) and a growing
number of Compressed Natural Gas (CNG) and Hybrid vehicles which help to reduce tailpipe emissions. LADWP is also involved with projects to advance plug-in hybrid technology, which has enormous potential to help reduce dependence on foreign oiL.
November, 2007 10 Los Angeles Department at Water and Powcr 2007 Integrated Resource Plan
Furthermore, LADWP is committcd to support the City of Los Angeles in mecting thc goals of its "Green LA - An Action Plan to Lead thc Nation in Fighting Global Warming" strategy that was announccd in May 2007.
2.3 Competitive Price
LADWP has bccn succcssful in maintaining low electric rates, as comparcd to its neighboring utilities in Southern California and California's Investor Owned Utilities. As shown in Figure 1, LADWP's average electric rates are at least 30 pcrccnt below those of Southern California Edison (SCE).
. An6lheim
. Pi.sadena
D Riverside o Burbank .. Glendale
Figure I: LADWP's Average Electric Rates Compared to Othcr California Utilities
November, 2007 11 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
While LADWP provides electricity at competitively low rates, there are several factors that are challenging this low rate structure. These factors include the volatility of natural gas prices, the increased efforts required to replace the aging power system infrastructure, the acquisition of renewahle energy resources and the accompanying new transmission lines necessary to bring the renewable energy to the Los Angeles area. Because of these initiatives, it is expected that some structural rate adjustments and amendments to the Energy Cost Adjustment Factor will be necessary. Nevertheless, LADWP will strive to set appropriate debt ratios to maintain LADWP's high bond ratings, and keep LADWP's retail electric rates competitive for the foreseeable future.
November, 2007 12 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
3.0 INTEGRATED RESOURCE PLANNING
. , 3.1 Introduction
Integrated Resource Planning is the process that an electric utility undcrtakcs to dcvelop an electric power resource portfolio considering supply-side and demand-side resource options by utilizing cconomic and risk asscssmcnt models. This planning process also takes into account
policies instituted by the Board of Water and Power Commissioncrs and the City of Los Angeles, and also applicable laws and regulations legislated by State and Federal Authoritics.
The planning horizon of a typical resource plan is gcncrally tcn ycars, however this 2007 IRP will both focus in particular over the next tive years, and additionally extend its planning horizon ovcr thc ncxt twenty years.
3.2 Key Assumptions
The following key assumptions were utilized in the development of this 2007 IRP.
1. LADWP's Octobcr 2006 Load Forccast data was utilized, which projects an annual peak load growth of 60 MW per year, and the energy consumption of LADWP's customers is projected to increase at an average rate of 0.9 percent per year. The load forecasting methodology is addresscd in Scction 3.3 and in Appcndix B.
2. LADWP will continue to be self-sutTcient in serving the electrical needs of its customcrs.
3. LADWP will providc suffcicnt gcncration to cover operating and replacement reserves in accordance with applicable federal and regional reliability requiremcnts.
4. LADWP's aggressive increase of energy cffcicncy and load rcduction programs will have a noteworthy impact on reducing LADWP's load. These programs and their projcctcd effectivcncss arc addrcsscd in Appcndix E.
5. LADWP will achieve 20% renewable energy by 2010 and 35% by 2020.
6. LADWP will reduce GHG emissions to 35'% below historical 1990 levels by 2030.
7. LADWP will maintain full control of its transmission assets and will continue to augment those assets commensurate with load growth and renewable energy opportnities.
November, 2007 13 Los Angeles Dcpartmcnt ot Water and Powcr 2007 Integrated Rcsourcc Plan
3.3 Load Forecast
The Load Forecast predicts that LADWP's customer's electricity consumption will increase at an average rate of 0.9 pcrccnt per year, and the peak dcmand will increase an averagc of60 MW per year for the foreseeable futurc.
Figure 2 shows both thc estimated energy consumption of LADWP's customers, mcasured in gigawatt hours (GWh), as wcll as two demand forecasts, measurcd in megawatts (MW). The demand forccast base case, as shown with thc green forecast line, is the expcctcd demand given the historical averagc pcak day temperatures. Thc rcd dcmand forecast line depicts a onc-in-ten forecast scenario. The one-in-tcn scenario is the demand that LADWP is ninety percent confident will not be exceeded in a given year
Thc more conservative one-in-tcn scenario for estimating demand is utilized in the development of the resource plan. This concept is an intcgral part ofthe planning process, as LADWP must always be prepared to mcct its customer's peak electricity needs, especially on hot days. The one-in-ten hot weather scenario avcrages about 550 MW above thc base (normal weather) case. However, the energy usage forecast shown with the violet line uses the base case, which is forecasted using average temperatures. The energy consumption patterns for the year do not vary significantly with individual hot or cold days.
Detailed discussions ofLADWP's forecasting methodology, data and other related issues are provided in Appendix B.
Figure 2: LADWP Energy and Demand Forecast
November, 2007 14 Los Angeles Departmcnt at Water and Power 2007 Integrated Resource Plan
It should bc noted that the July 2006 Heat Storm was the most extreme heat cvcnt in LADWP's forty year weathcr database. Demand reached 6,102 MW on July 24, 2006, which excccdcd the October 2005 Load Forecast for a I-in-40 event. The demands rcachcd during the July 2006 Heat Storm are attributed to the long duration and intensity of the heat storm.
3.4 System Reserve Margin
As a means of ensuring power system reliability, LADWP maintains an extra reserve margin of power generation resources in thc event of a power system disturbancc. In order to determine how much cxtra generation reserves are nccdcd, LADWP adheres to the Westcrn Electricity Coordinating Council (WECC) Reliability Standard, which is defined as follows:
Generation Capacity Requirement ~ Net Power Demand + System Reserve Requirement System Reserve Requirement = Operating Reserve + Replacement Reserve Operating Reserve = Contingency Reserve + Regulation
The "Net Powcr Demand" is the total electrical power requirement for all of LADWP's customers at any time. Thc other reserve requirements arc dcfined below, as well as numerically caleulated.
The loss of the largest single contingency of generation or transmission, which could be thc Haynes combined cycle unit or an Intermountain Power Project (IPP) unit, is a key reserve margin dctcrminant for LADWP and defincs thc Contingency Reserve as well as the Replacement Reservc rcquirements. Under the current WECC Minimum Operating Reliability Criteria (MORC), at least 50% ofthc Contingency Reserves must be Spinning Reserve. The Replacemcnt Reserve requirement is to restorc Operating Reserves within 60 minutes of a
contingency event. Thc Regulation Requirement is comparatively small (25 MW) and is rclatcd to system load variations due to customcr load changes. Given LADWP's current total generation portfolio, the system reserve requircmcnt is approximately l, I 00 MW. Therefore, if the system demand is 5,000 MW, LADWP must have a total of 6, 100 MW of generating capacity to meet the 5,000 MW demand.
It should be noted that LADWP uscs WECC's loss of the largest single contingency rule instead
of the 7% ofload rule. LADWP's system load would have to exceed 8,000 MW bcfore WECC's "7% ofload" criteria eclipscs the largest single contingcncy critcrion, and LADWP's load is not anticipated to exceed 8,000 MW for at least 30 years.
It is anticipated that some rencwable resources, particularly intermittcnt resources such as Wind and Solar, may not be depended upon to mcct pcak demand conditions. As LADWP acquires a larger proportion of such rcsources, studies on the charactcristics of these intermittent resourccs will nccd to be carried out to determinc thcir effect on reserve and regulation rcquirements.
Novembcr,2007 15 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
3.5 Summary of Loads and Resources
Current Resource Mix
LADWP's 2006 generation mix for both capacity and energy is shown in Figure 4. As can be seen from the pie charts, in 2006, 47% ofLADWP's generation capacity was from natural gas fueled units, while 21 % was from coal fueled units, as measured in MWs. However, the amount of energy that was generated from the natural gas units was only 30%, while 47% was from generated coal units, as measured in MWHs. The 7% of renewable energy was generated from a mixture ofLADWP's hydro generation plants along the Los Angeles Water Aqueduct System, digester and landtill gas from sewage treatment plants and landfills which are converted into energy, and purchases from wind farms, small hydroelectric facilities, and other renewable resources.
In addition to this pie-chart representation ofLADWP's generation portfolio, Appendix A, Table A-I, provides a detailed explanation of each generating unit, its capacity rating and the type of fuel that is used. Appendix A also provides a written description of each facility and the ownership details for the plants in which LADWP has a partial interest.
Returning to Figure 4, LADWP's coal capacity is 21 % (or, 1,514 MW), while the energy generated from coal plants was 47% (or, 11,386 GWhs). These coal units arc typically base- loaded, which means that they operate ncar their full output 24 hours per day. On the other hand,
LADWP's natural gas units comprise 47% of Li\DWP's generation capacity (or, 3,421 MW), while the energy produccd from these gas plants was 30% (or, 7,330 GWhs).
Typically, a natural gas plant has the ability to vary its output morc easily than coal or nuclear plants. In addition, a natural gas plant is generally more expensive to operate than a coal or nuclear plant due to the higher cost and price volatility of natural gas. Therefore, a natural gas plant will generally operate at its minimum capability during the evenings when the system demand is low, and will operate at its maximum capability during the day time, when the system demand is high. Figure 3 shows how LADWP typically dispatches its generation resources to meet customer demand for a typical summer weekday.
November, 2007 16 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
.. Purchases for Castaic Pumping _ Large Hydro & Pumped Storage c: Natural Gas
Figure 3: LADWP Typical Summer Day Generation Usage
The term "Capacity Factor" is also a term commonly used in the electrical industry. Capacity Factor dcscribes the quantity of energy a resource actually produces comparcd to the maximum it could potentially produce over a given pcriod of time, and is usually expressed as a percentage. Figure 3 shows that the Nuclear and Coal generation resourccs are being used at their maximum
output through all 24 hours of the day, so these resources would have a capacity factor of 100% for this day. However, the gas plants arc at their minimum for the evening hours, and then arc "ramped up" during the day to meet the energy needs of the customers. In this scenario, the daily gas plant capacity factor was 72%.
Figure 3 also shows how LADWP economically dispatches its generators. The first plants to be dispatched are shown at the bottom of the graph, and are either classified as "must-take" (depending on the type of contract), "must-run" (for example, generators along LADWP's aqueduct system), or are the least expensive to operate on a variable cost basis. LADWP's most expensive conventional generators arc those that use natural gas as fueL. While the Large Hydro
and Pumped Storage facilities are shown at the top of the stack, these resources are generally less expensive to operate than the natural gas-fired generators, but the hydro resources arc used to displace the more expensive gas-fired resources. Additionally, dispatchable hydro resources
(which arc controlled by a dam) have only a limited amount of water available to generate electricity on a daily basis, and the encrgy from these plants is optimized for use at the peak demand periods oftbe day. These hydro resources typically have a smaller capacity factor, due to the limited amount of water available, and in this scenario the capacity factor for these hydro resources was 15%.
November, 2007 17 Los Angeles Department at Water and Power 2007 Intcgratcd Rcsource Plan
Hydro plants havc an additional advantagc, in that hydro plants can increase or decrease the amount of electricity produced faster than natural gas, coal or nuclear plants. This bcncfits thc power system in that hydro resources can promptly respond to both the changing electrical demand rcquircmcnts ofthc City throughout the day, and can act to balance the energy generated intermittently from wind and solar renewable resources.
Projected Future Loads and Resources
The projected loads and resources summary for years 2007 to 2027 are shown in Table i (on page 19, and also sce Appcndix A, Tablc A-2 for complete details of projected resources). This table also includes the system reserve requirements as described in Section 3.4, and shows any capacity which is excess to system needs. In addition to the assumptions shown in Section 3.2, the following describcs somc ofthc main assumptions that were used to develop the Loads and Resources projections:
I) LADWP will obtain a suffcicnt amount ofrcncwable resources to generate 20% of the energy needs by 20 I O. 2) Customer Energy Efficiency (EE), Demand Side Management (DSM) programs will result in the MW savings shown in Table I. EE and DSM are considered a means to reduce firm peak demand and lower long term energy consumption. 3) Thc Hoovcr contract with the Western Area Power Administration (W AP A) that is scheduled to expire in 2017 will bc rencwcd. 4) Castaic Pumped Storage Power Plant capacity is increased by 20 MW per year, for a total incrcasc of 80 MW (increasing plant capacity from 1175 MW to 1255 MW) by 2009, resulting from its plant upgrade program. 5) The capacity of the Scattergood station will remain constant, cvcn if any rcpowcring or refurbishment plans are implemented. 6) Palo Verde unit 3 will bc upratcd in 2007. LADWP's cntitlement will be increased by 7MW. 7) LADWP's owncrship intcrcst in IPP is explained in Appendix A, in that LADWP can receive up to 18.168% of the output of the plant undcr thc Exccss Powcr Salcs
Agreement, which is currently 162 MW. However, this percentage, or portions of this percentage can be recalled from LADWP by othcr Utah IPP participants. This plan assumes that these other participants will recall about 25 MW per year to accommodate load growth in Utah until thc available cxccss power under the Agreement is exhausted.
8) The operation of the coal-fired Navajo plant is not extended beyond thc contract termination date of2019.
Novembcr, 2007 18 Z 0r 0 Table i en ~ '" Summary of Loads and Resources ;i 3 '" cr (J '" (Megawatts) '" ".. " N en C 2018 2019 2020 2021 2022 2(2) 2024 2025 2026 2027 tJ C 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 '" -- o: PEAK DEMAND FORJ~:CAST ::"' 3 LOAD FORECAST - Base Case (I) 5557 5618 5659 5709 5762 5811 5865 5926 sn6 6046 6104 6165 6224 6289 6349 6402 6454 6508 6561 6616 M7l " LOAD FORECAST - Hot (1 in 10) 6065 6132 6177 6231 6289 6342 6401 6468 6534 6599 6663 6729 6794 6864 6930 6987 7044 711J3 7162 7221 7282 :: -25 .25 .15 .15 -25 .15 ~ F.nergy Effciency aiidDSM -19 -50 -58 .56 .55 -52 .48 -37 .18 -24 -24 -25 -25 .25 -15 0 CQ'HRACT EXPORTS (2) 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 65 ~ 6496 6571 6640 6704 6769 6834 6904 6970 7027 7084 7143 7202 7261 7322 I PEAK DEMAND 6111 6147 6184 6240 6299 6355 6419 ~.. "' RESOURCES ~ ..'" "' :: RENEWABI.F.S 31 324 37 S2 709 953 983 1012 1019 1025 1032 1032 1032 1032 1032 1032 1024 1024 1021 1021 1021 P. 9 10 ii 12 13 14 16 17 I' 20 21 24 16 28 30 31 34 36 38 40 GREEN POWER I'OR A GREEN LA , "o DG 12 23 38 49 62 80 100 11 151 176 204 201 200 198 196 194 19l IOU 188 186 184 0 ~ NATlJRAL GAS " co\-mL"STION TLRBlN~:S (PEAKERS) 280 180 280 280 280 880 880 880 880 880 880 880 880 880 88" 88" 88" 88" 88" 88" 880 .. CO\-1BI~'ED CYCLF. 1337 1337 i337 1337 1337 1337 1337 1787 1787 1787 1787 1787 1787 1787 1787 1787 1787 1787 1787 1787 1787 - CO:\VE:"TIONAL STEA\l TURBI~'ES 1804 J804 1804 1804 J804 1239 1239 789 789 789 789 789 789 789 789 789 789 789 789 789 789 '- TOTAL NATLRAL GAS 3421 3421 3421 3421 3421 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456
COAL 1514 1489 1464 1439 1414 1389 1352 1352 1352 1352 1352 1352 1352 875 87 875 875 87 87 875 875
'iUCLEAR 388 388 388 388 38 388 38 388 388 388 388 388 388 388 388 388 388 388 388 388 388 N LARGE HYDRO 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 C 1255 1255 1255 J255 PLMP~:D STORAGE 1175 1195 1215 1235 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 C-- TOTAL HYDRO + PUMP SLL. 1666 1686 1706 1726 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 1746 ::- 8093 8129 8162 8198 8198 8198 7721 7721 7721 7713 7713 7710 7710 7710 ~ I TOTAL RESOURCES 7331 7340 7400 7560 7752 8025 8039 '" (J.. ~"' RESERVE MARGe; '" P. RESERVE (MW) 1220 1193 1216 1320 1453 1670 1620 1597 1558 1522 1494 1429 1364 '17 751 694 619 57" 508 449 388 ¡: 25% 24% 23% 22% 21% 20% 12% 11% 10% 9% 8% 7% 6% 5% RESERVE (%) 20% 19% 20% 21% 23% 26% 25% "'" WECC MORC RESERVE REQLïREMF.NT 1111 1111 iiii IIJ1 1111 iiIl iiii 1111 iiii 11Il 1111 iiii 1111 1111 1111 iiii ii11 1111 1111 ILLL IILI 0 486 447 411 38 31' 15 -294 -360 417 -482 -541 -603 -662 -723 EXCESS R¡'~SERVE 109 82 105 209 341 559 509 .." " :-otfS: "o (I) October 2006 Load Forfea~t: Ba~c ease is l-in-2 ease and Hot is 1-in-IO Unt Weather cases. I in 10 case i~ used. "' (2) IncludfsCDWRobligatiun. I :: Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
Projected Resource Mix
Figure 4 below shows the comparison of the power system capacity and energy resource mix for calendar year 2006 and the projected mix for 2010. The comparison shows that energy production from coal and gas resources will decrease from 47% to 43% and from 30% to 22% respectively during this period. The energy from coal and gas will he substantially replaced by eligible renewable energy resources, in accordance with LADWP's RPS goals.
LADVP Energl Miz. 2006
Eligibl~ NYck~r. 8l: R~~~w~bl~~,"
L~¡9~ Hydroelectric, " CO~I, 47"
Source: 2006 POWN Co~tCht bbcl
lADW Capacit Mix, 2010 LADW Energy Mix, 2010'
Eligibl.; Eligible Nudc~r Nuclc~r " RChcw~blc~" " Rcncw~blc~ N~tur~1,,, G~~
L~r9': Hydrodcctric m L~rgc " Hydrodcctrk'"
. Excluding purch~~c~
Figure 4: Capacity and Energy Comparisons, 2006 to 2010
November, 2007 20 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
The Load and Resource graph for the 20-ycar planning period is shown in Figure 5.
- Total Resources
- Peak Demand+ Reserve Requirement
- Peak Demand
Figure 5: LADWP Loads and Resources
Figure 6 graphically indicates the amount of capacity provided by each resource, and compares it with the Load Forecast, combined with reserve requirements discussed in Section 3.4.
Figure 6: LADWP Supply-Side and Demand-Side Resources
November, 2007 21 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
The amount of energy estimated to serve LADWP's customer needs over the next 4 years is shown in Figure 7 helow.
. Eligiblo Ronowablos
. Largo Hydrooloct,ic
o Natur dl G.:s
. Coal
Figure 7: Energy Projections, 2007 to 2010
3.6 Environmental Achievements and Goals
Greenhouse Gas Accomplishments
In 1995, LADWP signed a Climate Challenge Participation Accord with the United States Department of Energy, voluntarily committing to reduce greenhouse gas emissions from power generation to keep LADWP's average CO2 emissions from 1991 - 2000 below its 1990 baseline. LADWP achieved this goal. In 2000, LADWP's Integrated Resource Plan set a new goal to reduce CO2 emissions from power generation to 5% below 1990 levels by 2012.
Due to these efforts to reduce GHGs, LADWP reduced total CO2 emissions by 8.6% when comparing 1990 to 2006, while total electrical generation (in MWh) has grown 14.0% over this same period (See Table 2).
November, 2007 22 , Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Table 2: Changes in LADWP Generation Resource Mix from 1990 to 2006
Total Generation Total Generation Total Generation C02 Emissions Total Generation C02 Emissions Year (MWH) (short tons) Year (MWh) (short tons) 1990 25,481,532 19,372,147 2006 29,043,415 17,708,071 Increase or Decrease relative to 1990 3,561,883 -1,664,076 Percent I ncrease or Decrease relative to 1990 14.0% -8.6%
AB 32 established the Global Warming Solutions Act of 2006 that requires the California Air Resources Board (CARE) to develop regulations and market mechanisms to ultimately reduce California's greenhouse gas emissions to 1990 levels by 2020, or an estimated 174 million metric tons CO2-equivalent (MMTC02E). LADWP is actively participating in the rulemaking process and LADWP's GHG reduction goals will be adjusted to comply with AB 32 as the program rolls out beginning in 2012.
Additional information regarding LADWP's actions limiting GHG emissions are shown in Section 2.2 and Recommendation 4. Appendix C also provides further background information, including information on AB 32.
Nitrous Oxides (NOx) Accomplishments
LADWP's goal is to limit the NOx emissions of the Los Angeles area generating plants to below
the level of its RECLAIM allocations. RECLAIM (Regional Clean Air Incentives Market Program) is the NOx emissions credit allocation program of the SCAQMD (South Coast Air Quality Management District), and has been in operation since 1993. Figure 8 shows LADWP's historical and projected NOx emission levels for the next five years.
November, 2007 23 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
Figure 8: Historical and Projected NOx emissions
November, 2007 24 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
4.0 RECOMMENDED STRATEGIES
4.1 Recommendations
To meet the goals and policy objectives of the 2007 Integrated Resource Plan the following strategies are recommended:
1. Increase the commitment and funding to Customer Energy EtTeieney, Demand Side Management and Solar Rooftop Programs and identifY opportunities to enhance and expand these programs. 2. Support and advocate incremental requirements in Title 24 and other building and appliance standards to reduce energy usage. 3. Aggressively pursue the Renewable Portfolio Standard goals of having 20% ofLADWP's customer's energy needs met by renewable sources of energy by 2010, with a longer term goal of 35% by 2020. The portfolio of renewable energy projects will be diversified by location and technology. LADWP will give preference to projects that are located within the Los Angeles region and are owned and operated by LADWP to further support LADWP's economic development and system reliability objectives. 4. Provide specific steps needed to achieve the reduction of GHG emissions to 35% below 1990 levels by 2030. Additionally, LADWP will adhere to the elimate change legislation California signed into law in 2006, ineluding SI3 1368: The Greenhouse Gas Emissions Performance Standard, and AB32: The California Global Warming Solutions Act. 5. Provide specific actions to be taken to successfully integrate renewable generation resources into the power system while maintaining power system reliability. 6. Establish programs to enhance and expand electric transmission resources, particularly in gaining access to renewable energy resources. 7. Repower additional in-basin generation consistent with power system needs and environmental requirements. 8. Ensure that the power generation, transmission and distribution infrastructure operates in a reliable and effcient manner. A Power Reliability Program initiated in 2007 will improve maintenance practices, address the aging power system infrastructure, increase capital programs necessary to support load growth, and increase staffing levels to support reliability related work.
November, 2007 25 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
4.2 Details of the Recommendations
Recommendation I: Increase the commitment and fnnding to Customer Energy Effciency, Demand Side Management and Solar Rooftop Generation Programs and identify opportunities to enhance and expand these programs.
Demand-Side Management Programs
Backl!round
While the 2000 IRP was being developed in the summer of 2000, serious electricity supply problems in California were being projected for the summer of2001. The 2000 IRP included a goal of meeting 50% ofload growth through the combination of the DSM, DG, and Renewable Resources programs. It also called for 10 MW of DSM by the end of2001, 120 MW by 2005 and 245 MW ofDSM by 2010. Since 2000, about 176 MW of peak load reduction has been achieved through DSM, and 3 MW of DG and 1 MW of Solar Power have been installed in the LADWP system.
During the energy crisis of2000-2001, financial incentives from the State of California (State) augmented LADWP's investment in DSM. As part of SB5X, LADWP received approximately $20 million in funding for DSM from the State to acquire additional peak load reduction by December 2002. This funding allowed LADWP to increase DSM incentives, in some cases doubling them, to encourage even greater levcls ofload reduction in lighting and HV AC related end-uses.
Since that time, LADWP has continued to support and promote energy effciency (EE) as a DSM strategy through the programs and services it offers to its customers. A summary ofLADWP's current EE programs can be found in Appendix E, though it should be noted that LADWP implemented much more aggressive programs starting in 2006 that include new program offerings in both the residential and commercial sectors. Notably, as part of the Residential initiatives, the Low Income Refrigerator Exchange Program will provide 50,000 new high et1eiency retrigerators to qualifying low income customers in exchange for their ineftcient refrigerators, which will be recycled in an environmentally sound manner. LADWP will also distribute 2,000,000 compact fluorescent lamps to residential customers to raise awareness of this technology. The Commercial Programs, on the other hand, will provide small business customers with energy effciency "direct install" services through the payment of i 00% of the cost of lighting retrofits up to a predetermined limit. The core Lighting and Chiller Programs have been enhanced to offer customers increased incentives to cover the full incremental costs for their efficiency projects. New efficiency incentive offerings are continuously being launched such the Custom Performance Program which provides incentives for energy saving measures not covered by the existing prescriptive programs, such as equipment controls, industrial processes and other innovative energy saving strategies. Altogether, these incentive programs
November, 2007 26 ~ Los Angeles Department of Water and Power 2007 Integrated Resource Plan
and services arc intended to achieve an effciency goal four times that actually achieved in the last fiscal year.
Estimates of the future impacts of DSM for this 2007 IRP were developed based on a study performed by Quantum Consulting/KEMA on the potential of energy efficiency in three sectors: Residential, Commercial, and IndustriaL. Four types of EE potential were identified: Technical, Economic, Achievable and Naturally Occurrng. The scope of the study primarily used existing data sourccs and looked at commercially available and cost-effective technologies. The planning horizon for the study was selected to match LADWP's original RPS targct of20% rcncwables by 2017.
This 2007 IRP assumes that all available and achievable energy efficiency savings that arc cost- effective when compared to supply side alternatives will be implemcnted during the planning period. LADWP is committcd to a leadership role in acquisition ofDSM resources.
Achievements and Proiections
Since 2000, approximately 176 MW of peak load reduction and 370 GWhs of energy savings were achieved through LADWP's DSM programs. The significant increase in DSM savings during thc initial years was a direct result of supplemental funding of LADWP's DSM efforts by the State. The majority ofthese savings came from the Commcrcial and Industrial sectors through investments in more efficicnt lighting and HV AC systems. Table 3 shows a breakdown and comparison of thc estimated demand reduction achieved from LADWP's DSM programs during the fiscal years 2000-2001 through 2005-2006.
Table 3: LADWP DSM Program Aecomplishmcnts
Sector 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 Total
Residential - Existing 5.6 23.3 4.0 74 5.1 1.6 47,0 Residential - New nla nla nla nla nla nla nla Commercial - Existing 270 53.5 15.3 12.1 11. io1 129.1 Corncrcial- Ncw nla nla n/a n/a n/a nla nla Industrial * nla n/a n/a nla nla nla nla
Annual 32.6 76.8 19.3 19.5 16.2 11. 176.1 Cumulative 32.6 1094 128,7 148.2 1644 176.1 * Note: Industrial program savings not diffcrcntiatcd from Commercial - Existing
Projections for DSM for the 2007 IRP utilized Maximum Achievable EE potential identificd in the Quantum Consulting/KEMA study. Achicvablc EE can be characterized as the subset ofEE
November, 2007 27 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
measures that are cost-effective when comparcd to supply-sidc altcrnativcs and can bc capturcd with specific program funding and measure incentive levels, incorporating real-world customer bchavior. Achicvable potential was analyzed in three scenarios: Base, Advanced, and Maximum Achievable. LADWP will be pursuing an accelcratcd Maximum Achicvablc sccnario for thc next 5 years and is increasing its savings targets beyond Maximum Achievable, consistent with thc LADWP savings goals submitted to the California Energy Commission as required by
Assembly Bi1l202L. This bill supports thc Statc of California's cstablishcd goal ofrcducing forecasted energy consumption by i 0% over the next ten years.
A summary by year is shown in Table 4.
Table 4: DSM Projections
IENERGY EFFICIENCY PROJECTIONS - ANNUAL PEAK SAVINGS (MW) I
Ouantum Base 14 18 20 21 21 21 20 18 17 16 14 11 213 Quantum Advanced 17 29 34 36 36 35 :n 10 26 25 24 21 345 Ouantum "\aximum Achievable 20 18 50 59 60 56 48 37 28 24 26 30 476 LADWP Proposed 12 50 58 57 5S 53 53 53 53 53 53 51 603
IENERGY EFFICIENCY PROJECTIONS ANNUAL ENERGY SAVINGS (GWH) I
uantum Base 81 104 114 115 112 107 100 91 81 71 62 51 1,090 uautum Advanced 98 166 188 193 188 17 159 139 118 108 95 81 1,709 uautum Maximum Achievable 114 214 273 312 307 275 213 150 99 69 52 35 2,113 LADWP Pronosed 58 275 315 300 280 255 252 252 252 252 252 252 2,995
Distributed Generation Programs
The DG Program entails the installation of new small electric generating plants, typically less than 20 MW, at or ncar an elcctric load thcrcby rcducing or climinating losses due to transmission and distribution. LADWP currently has approximately 350 MW of customer generation on its system, which mainly consists of cogeneration. Studies have shown that about 310 MW are used at customer locations, with about 40 MW being continually injected into LADWP's grid from customer sites. In addition, over 900 customers have installed solar photovoltaic energy systems totaling over 10 MW of installed capacity. It is anticipated that customers will install approximately 270 MW of solar photovoltaics over the course of the lO- year planning period.
Though a large amount offuture DG installations are expected to be customer initiated, LADWP will also continue to install a variety of distributed energy resources over the planning period totaling approximately 5 MW of photo voltaic, small hydro and other technologies.
See Appendix F for additional information on DG.
November, 2007 28 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Green Power Program
On May 13, 1999, the Los Angeles Department of Water and Power (LADWP) launched the Green Power for a Green LA Program. Customers participate by making a voluntary contribution of 3 cents per kWh, with the monies going toward the purchase of additional renewable energy or to help construct renewable energy generation units.
The year 2006 represents the eighth year of operation for the Green Power Program. Program customer paricipation ineludes over 22,000 residential and non-residential meters and approximately 62 GWhs of renewable energy sales. This number is expected to increase to approximately 100 GWhs over the next io years.
Green Power Program contributions go toward the purchase otrenewablc energy or the development of new renewable energy plants such as those described below.
. The Terminal Island Digester Gas Project aims to utilize the digester gas produced at the Terminal Island Wastewater Treatment Plant, in a state-of-the-art I MW fuel cell plant. The
capacity of the Project has been increased from 250 kW to I MW in order to utilize all the methane gas produced at the treatment plant. The Project has been awarded a $4.5 million grant from the California Energy commission and is expected to be online by 2009.
. LADWP is unique among most electric utilities in that it also manages a water utility. One
component of the Water System's Distribution System arc water regulator stations that reduce pressure in different parts of the Distribution System. LADWP is evaluating opportunities to place hydroelectric generators at certain regulator stations so that the energy
will be converted to electrical energy, instead of being dissipated mechanically. While the
capacity of these hydroelectric plants will likely not exceed one MW each, the annual capacity factors should exceed 90%. One project that is currently under development is the addition of a 750 kW hydroelectric plant to be built in conjunction with a regulating station in Coldwater Canyon. Should all prospective sites be developed, an approximate total of 4 MWs could be added to the distribution system over the next 10 years.
. The Terminal Island Renewable Energy Project (TIRE) will add an additional 3 to 5 MWs of capacity using methane gas recovered from a proposed bio-solid injection process in either a fuel cell or in an engine. This project will be implemented in three phases, and the first phase should be completed in 2008.
All customers' voluntary contributions under the Green Power for a Green LA Program will provide renewable energy above and beyond any Renewable Portfolio Standard activities. The
goals of the Green Power Programs are shown in Table 5.
November, 2007 29 Los Angeles Department 01 Water and Power 2007 Integrated Resource Plan
Table 5: Green Power Program - Capacity and Energy
Calendar Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 -- --_.-..._--
~ MW 0 I 2 3 4 5 6 X 10 12 14 16 "~ ~" Z .! .. GWh 0 5 10 15 20 25 30 40 50 60 70 80
.cu OJ;. MW 7 7 7 7 7 7 7 6 6 5 4 4 ::.. .." .. ~ GWh 60 60 60 60 60 55 55 50 45 40 35 30
-¡ MW 7 8 9 10 II 12 13 14 16 17 18 20 ~ - '" -- ¡. GWh 60 65 70 75 80 80 85 90 95 100 105 110
Recommendation 2: Support and advocate incremental requirements in Title 24 and other building and appliance standards to reduce energy usage.
Both California and thc City of Los Angeles have the most stringent building codes in the country to maximize energy and water conservation. In 2006, thc Los Angeles City Council established an incentive for green building designs meeting Leadership in Encrgy and Environmental Design (LEED) Silvcr standards. Green buildings utilizing LEED standards are designed to reduce the environmental impact of building projccts, crcatc healthier and sustainablc living environments for people, and minimize the negative impact on local, regional and global ecosystems.
The five main goals of grccn building designs are as follows: I) Sustainable Sites: This includes providing for landscaping, stormwater management, construction and demolition recycling, minimizing impermeable surfaces, incrcasing tree canopies, providing prcfcrrcd parking for carpools, and providing secure bicycle storage capacity. 2) Water Effcicncy: This includes providing high etlciency fixtures including toilets, urinals, faucets and showerheads, recycling wastcwatcr, and efficient irrigation rcquircments. 3) Energy and Atmosphere: This includcs requiring encrgy efficient equipment, dcsigning buildings to be Solar Ready, and requiring Heating, Ventilation and Air Conditioning (HV AC) equipmcnt, refrigeration equipment and fire suppressions systems not to use hydrofluorocarbons (HFCs). 4) Materials and Rcsourccs: This includes requiring the use ofrecycled and rapidly renewable materials, and requiring waste haulers, dcmolition and construction firms to recyclc of at least 50% of non-inert construction materials. 5) Indoor Environmental Quality: This includcs providing for improvcd indoor air quality, increascd daylighting, improved thermal comfort control, and the use oflow emitting materials such as adhesives, paints, carpet, and composite woods.
November, 2007 30 ~ Los Angelcs Dcpartment of Water and Power 2007 Intcgrated Resource Plan
LADWP offcrs priority service planning for electrical and water scrvice for green buildings. Launched in Deccmber 2006, LADWP's Green Building Incentive Program provides financial incentives for new construction and major rehabilitation projects that are LEED-ccrtified. Payments are calculated using a simple cents/square foot basis, on tbe number of points carned in the LEED encrgy category. Tbe incentivc rate increases for each additional point earned (e.g., $0.30/square foot for I point, $0.40/square foot for 2 points, etc.) as projects save more energy.
LADWP has a variety of energy effciency programs designed to motivate customers to replace old and ineffcient appliances with newer energy efficient models. The Commercial Lighting Effciency program offers cash incentives to LADWP customers to install high effciency lighting. The Consumer Rebate Program offers cash rebates to customers who purchase high ef1ciency applianccs, air-conditioners and othcr energy saving products that meet or exceed Energy Star effciency ratings. The Low Income Refrigcrator Exchange Program provides free energy efficient refrigerators to such customers in exchange for their old ineffcient refrigerators, which are then recycled in an environmentally responsible manner. Thcsc and other LADWP incentive programs arc explained in further detail in Appendix E.
Recommendation 3: Aggressively pursue the Renewable Portfolio Standard goals of having 20% of LADWP's customer's energy needs met by renewable sources of energy by 2010, with a longer term goal of 35% by 2020. The portfolio of renewable energy projects wil be diversified by location and technology. LADWP will give preference to projects that are located within the Los Angeles region and are owned and operated by LADWP to further support LADWP's economic development and system reliabilty objectives.
Section 1.5 of this IRP provides a historical perspcctive on how LADWP developed its goal of having 20% of it's customer's energy needs met by renewable sources of energy by 2010, and also having a longer term goal of35% by 2020. Specifically, this IRP recommends the following: 1) LADWP will provide adequate financial and workforce resources that arc deemed neccssary to achieve the accelerated RPS goals. 2) LADWP will provide a balanced and diversified portfolio of renewable resources. Additionally, solar and wind projects should be geographically diversificd in order to mitigate the effect of localized weather events on energy production. Aiso, the terms of Power Purchase Agreements should not terminate concurrently in order to limit the risk exposure of acquiring rcplacement renewable energy. 3) Figure 9 shows the anticipatcd energy production mix ofrenewable technologies expected for years 20 I 0 and 2020, givcn the projects resulting from the responses to the Requests for Proposals for Renewable Resources discussed in Appendix D.
Novcmber, 2007 31 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
Reiiewilhles. 2010. by Energy Renewables. 2020. by Energy
GEothErmal n% LandiillGas II Dig_sterG.s II Digester Gas II Geothermal IIG.mherm.1 Municip"lsolid II L.ndfillGas ",cd II L.indlillG.5 waste D Municip"lsolid wasle 3'% i: Municip,1solid ".ste conversion conversion 0% .Sma'IH~dro.l.ctric . Sm.IIH~droel.cl'¡c
Small II Sol.rPholovoll,ic II Sol.¡rPhotooolt.io Hydroelectric . Solar Th.lm.1 II Sol.¡rTh.rm,,1 n% conversion ",Wind 8% i¡\1ind
Solar Thermal Small 0% Hydroelectric 3% 8%
Figure 9: Anticipated Energy from Renewable Projects for Years 2010 and 2020
4) LADWP has made significant progress on increasing the amount otrenewable energy over the last several years. Table 6 shows the amount ofrenewable energy generated by year, LADWP's existing renewable projects, and LADWP's planned renewable projects.
Table 6: Renewable Energy Projects
Percent Renewable Sales to Customers Percent Renewable Year Power 2007 8%' 2006 7% 2005 6% 2004 5% 2003 3% . projected Source: Power Content Label
Existin Renewable Projects Annual Energy Productian Renewable Enemv Proiect Technoloav Acauisition Date CaoacitvlMW\ IGWH\ Milford Corridor, Utah Wind COD 2009 185 460 Powerex, Pacific Northwest Small hydro 2007 50 430 Pleasant Valley, Wyoming Wind 2006 82 230 Penrose Landfill Landfill gas 2005 7 45 Bradley Landfill Landfill gas 2005 6 36 Solar Rooftop Photovolli:ic_-. Solar 2000 11 20 Lopez Canyon Landfill Landfill gas 2000 2 5 Hyperion Treatment Plant Digester gas 1995 22 143 Aqueduct hydro plants Small hydro 1908-1987 il 670 Tota!s 575 2,040,
Planned Renewable Pro"ects Estimated Annual Energy Number of Total Production Technoloav Proiects Estimated COD CaoacitvCMW\ fGWHI Biomass 3 2007 2012 12 83 Geothermal 4 2010 - 2012 287 2,291 Small hydro 3 2008-2012 17 102 Solar 7 2010 - 2017 1,000 2,394 Waste-la-Energy 4 2010-2013 100 800 Wind 1Q 2008 - 2010 1159 ,1)55 Totals 31 2,575 8,925
November, 2007 32 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Recommendation 4: Provide specific steps needed to achieve the reduction of GHG emissions to 35% below 1990 levels by 2030. Additionally, LADWP wil adhere to the climate change legislation California signed into law in 2006, including SB 1368: The Greenhouse Gas Emissions Performance Standard, and AB 32: The California Global Warming Solutions Act.
SB 1368: Greenhouse Gas Emission Performance Standard
SB 1368 was signed into law on September 29, 2006 and requires the California Public Utilities Commission (CPUC) and tbe California Energy Commission (CEC) to establish a greenhouse gases emission performance standard and implement regulations for all long-term financial commitments in baseload generation made by load serving entities (LSEs) and local publicly- owned electric utilities (POUs), respectively. The greenhouse gas emission performance standard is not to exceed the rate of greenhouse gases emitted per megawatt-hour associated with combined-cycle, gas turbine baseload generation. The proposed regulations establish an emission performance standard of I, i 00 pounds of carbon dioxide per megawatt hour of electricity.
AB 32: Global Warming Solutions Act of2006
AB 32 was signed into law on September 27, 2006 and requires the CARB to develop regulations and market mechanisms that will ultimately reduce California's greenhouse gas emissions by 25 percent by 2020, or an estimated 174 MMTC02E. Mandatory greenhouse gas emission caps will begin in 2012 for significant sources and ratchet down to meet the 2020 goals. In the interim, CARE will begin to measure the greenhouse gas emissions of the sectors it determines as significant sources of greenhouse gas emissions. The bill also provides the Governor the ability to suspend the emissions caps for up to one year in the case of an emergency or significant economic harm.
Joint Greenhouse Gas Proceedings of the California Public Utilities Commission and California Energy Commission
In light of AB 32, the CPUC and CEC arc jointly developing guidelines for a load-based GHG emissions cap for the electricity sector that the CARE can consider as it develops a GHG emissions cap for the California economy, including the electricity and natural gas sectors. These proceedings will focus on six programmatic clements, including: i) reporting requirements, 2) baseline devclopment, 3) emission reduction measures and annual emissions caps, 4) flexible compliance mechanisms, 5) entity specific allowance allocation, and 6) modeling to support policy design and analysis of costs. The CPUC and the CEC plan to issue a final decision by September 2008.
November, 2007 33 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
City of Los Angeles Green LA Climate Action Plan
Los Angeles Mayor Antonio Villaraigosa announced in May 2007 a "Green LA - An Action
Plan to Lead the Nation in Fighting Global Warming". A main goal of this plan is to reduce the City of Los Angeles' greenhouse gas emission by 35% below 1990 levels by 2030. This Green LA plan has over 50 initiatives that will reduce the City's carbon footprint. The Green LA plan can be found over the Internet at: htt://www .Iacitv .org/mavor/indexrightlmavorindexrght24304523 8 05152007. pdf
Some of the Green LA measures that are specific to LADWP include the following:
. Meet the goal to increase renewable energy from renewable resources to 20% by 20 I 0 . Increase use ofrenewable energy to 35% by 2020 . Let contracts for power imports from coal-fired power plants expire . I ncrease the e1leiency of natural gas-fired power plants
. Distribute two compact fluorescent light (CFL) bulbs to each of the 1.4 million households in the city . Increase the level and tyes of customer rebates for energy efficient appliances, windows, lighting, and heating and cooling systems . Increase the distribution of energy efficient refrigerators to qualified customers
LADWP Climate Change Legislative and Regulatory Guiding Principles
In addition to SB 1368 and AB 32, there are numerous proposed state and federal bills related to climate change. These policies and legislation approach climate change from many directions, including establishing a California statewide 1990 emissions baseline, mandatory reporting, allowance allocations, market-based compliance mechanisms, alternative fucls, carbon dioxide containment, climate science, energy efficiency, renewable energy and tax programs.
In order for the City of Los Angeles to effectively participate in the legislative and regulatory activities taking place at the state, regional and fedcral levels, it is critical that LADWP be responsive to these proposals with a clear set of principles in order to effectivcly advocate for the
City of Los Angeles. The implications for environmental and rate impacts are significant if the City is unable to respond effectively and quickly to various legislative and regulatory proposals. Therefore, in June 2007 LADWP adopted the following Climate Change Legislative and Regulatory Guiding Principles:
Principle #1: ACTION Pursue absolute reductions of greenhouse gas emissions as first priority followed by support of carbon neutral technologies as the second priority. Third priority shall be given to emissions trading and that strategy shall be exercised only upon exhausting all other strategies.
Principle #2: LEADERSHIP Efforts to reduce emissions and exercise leadership must be taken at all levels - local, state, national and international - to effectively address the global impacts of climate change. All
November, 2007 34 Los Angclcs Department of Water and Power 2007 Integrated Resource Plan
programs must encourage municipal efforts to reduce carbon emissions and recognize the critical role cities play in program implementation.
Principle #3: ACCOUNTABILITY It is in the best interest of the communities we serve, our customers and our employees that we actively take responsibility to reduce the enviroruental impacts of our utility operations, including those impacts on climate change.
Principle #4: ENVIRONMENTAL JUSTICE Etlorts to reduce greenhouse gas emissions must avoid localized and disproportionate impacts on low income and disadvantaged communities or communities already adversely impacted by air pollution.
Principle #5: PROTECTION Efforts to mitigate climate change must protect public health and quality of life, and be sensitive to and minimize subsequent impacts on other cnviroruental resources, including land, water, air and biodiversity.
Principle #6: PARTNERSHIP
Environmental and business initiatives need to be developed jointly. Policies that encourage the dcvclopment of clean and carbon neutral technologies can help devclop a green economy and local economic engine.
Principle #7: INNOVATION Funding and support for research, development and deployment of water conservation, energy effciency, renewable energy, advanced clean technologies, and carbon capture and sequestration, if proven feasible, are crucial to the successful reduction of carbon emissions from the clectricity sector.
Principle #8: EQUITY Economic costs and impacts of climate change emission reduction programs must be distributed equitably within sectors and across all sectors contributing to greenhouse gas emissions.
Principle #9: CONSISTENCY Any state market-based compliance program that is established must be designed to allow for a smooth transition to a federal market-based carbon reduction program that does not place California or the City of Los Angeles at an economic disadvantage.
Principle #10: EDUCATION Pursue energy efficiency and water conservation outreach and education to customers and employees on climate change and actions that can be taken directly to reduce energy and water consumption.
November, 2007 35 Los Angeles Department ot Water and Power 2007 Inteéated Resource Plan
LADWP Greenhouse Gas Emission Reduction Recommendations:
Final regulations to implement AB 32 will not be adopted until January 1,2011. Until that time the CARB, with input from the CPUC and CEC for the electricity sector, will continue its rulemaking efforts and coordination with stakeholders and others. LADWP recommends the following actions be taken to align our efforts to reduce GHG emissions with these larger efforts:
1) Implement programs to achieve the goals set out in the City of Los Angeles "Green LA - An Action Plan to Lead the Nation in Fighting Global Warming". 2) Apply the "Climate Change Legislative and Regulatory Guiding Principles" adopted by LADWP in July 2007 to GHG policy activities. 3) Actively participate in the state GHG rulemaking activities, and potential federal GHG rulemaking activities. 4) Develop a GHG reduction plan to comply with State GHG reduction goals and potential federal GHG reduction programs, and incorporate such plans into future IRPs. 5) Continue to evaluate various strategies to reduce GHG emissions from LADWP's generation resource mix. 6) Coordinate with the Mayor and City Council on implementing GHG policies. 7) Continue to quantify LADWP's GHG emissions and efforts to reduce emissions. 8) Coordinate with other stakeholders, city departments, utilities, residential and commercial customers to identify and implement strategies to reduce GHG emissions. 9) Work closely with other City departments on developing offset projects related to City operations.
10) Evaluate the financial impacts of various strategies to reduce GHG emissions. 11) Advocate and support funding for new technologies and studies to reduce GHGs, sucb as sequestration.
Recommendation 5: Provide specific actions to be taken to successfully integrate renewable generation resources into the power system while maintaining power system reliabilty.
One of the main responsibilities of power system operators is to maintain the balance between the total aggregate electrical demand of its customers and the amount of energy generated to meet that demand. This concept is discussed and shown graphically in Section 3.5. In that example, conventional electrical generation technologies, such as nuelear, coal, natural gas and large hydro are controlled and dispatched by the power system operators throughout the day to maintain this balance between demand and generation.
However, some renewable resources generate energy according to nature, and are not controllable or dispatehable by power system operators. For example, solar resources generally only produce energy when the sun is up, and wind resources generally only produce energy when the wind is blowing. Such renewable resources are often referred to as intermittent renewable generation technologies.
November, 2007 36 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
It is anticipated that the amounts of energy generated from solar and wind resources will be substantiaL. As is shown in Figure 9, in both 2010 and 2020, solar and wind resources account for 58% of all renewable resources.
Because power system operators cannot control or dispatch the production of energy from most rcnewable resources, the remainder of the powcr systcm must be manipulated to accommodate both the changcs in rcnewable energy production and the changcs in customer demand. In general, with the addition of incrcasing amounts of renewable resources, the convcntional resources of a power system must becomc morc flcxible in their ability to increase and decreasc the amount of cncrgy that is generated to successfully and reliably integrate new renewable generation.
In the last several years, LADWP has been increasing its efforts to acquire renewable resources, and beginning in 2007, 8% of the energy sold to its customers was generated from renewable energy resources. Nevertheless, with the much higher percentage of renew abIes that will bc coming on line, a variety of modifications will necd to bc madc to the power system to successfully and reliably integrate these higher percentages of renewable rcsources. In preparation, LADWP has both conductcd preliminary studies on integrating renewable rcsources, and has also reviewed many renewable resource integration studies that have been published over the last sevcral years.
These studies have some common observations and rccommendations regarding the integration of intermittent rcncwable resources into power system generation portfolios. Some common observations of these studies includc the following:
i) Largcr powcr systems with robust transmission systems havc a grcater ability to integratc intcrmittent wind and solar resources. 2) Individual wind farms tcnd to have a high variability in the amount of energy produccd, but multiple wind farms located in diverse gcographic areas tend to reduce the overall varability in thc amount of wind energy production. 3) Wind energy production has a small impact on regulation (minute to minute variability), but a larger impact on load following capability (hour to hour variability) and unit commitment decisions (day ahead flexibility). 4) Wind is usually categorized primarily as an cnergy resource. The capacity value of a wind farm to the power system is much lower than the rated capacity of the wind turbines. Appendix D contains additional information regarding "dependable" capacity values of renewable resources. 5) There is a financial cost to integrate intermittent wind and solar renewablc projects into cxisting power systems, and this cost incrcascs with increasing amounts of intermittent renewable rcsourccs. Some studies have estimated this cost to rangc bctween $2/MWh to $6/MWh, depending on thc pcrccnt of wind penetration and the size of the power systcm. 6) Wind energy production pattcrns are not usually aligned with daily load pattcrns. Wind production tends to be greatest in the evenings whcn thc daily load is at its minimum. Figure D-I in Appcndix D illustrates this concept.
November, 2007 37 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
7) Solar energy production patterns arc more closely aligned with daily load pattems than with wind energy production patterns. Figure D-2 in Appendix D illustrates this concept. 8) High wind energy production during low power system energy demand hours in most cases represents the greatest challenges for power system operations. 9) Average daily and monthly wind energy production profiles are not representative of actual hourly production, due to the high variability in hourly energy production. i 0) In the current energy market, the energy from renewable resource generation will tend to displace the marginal resource, which is typically natural gas. However, if future constraints are applied to carbon fucls such as coal, and coal becomes the marginal resource, then coal energy will be displaced by renewable resources.
Some common recommendations from these studies include the following:
i) Successful integration of intermittent renewable resources requires an investment in transmission and generation resources, changes in power system operations and practices, and cooperation among power system operators and energy providers. 2) New generation should be able to operate flexibly, meaning it should be able to start and
stop quickly, and to be able to cycle on and off many times throughout the year. It should also be able to ramp (change the amount of energy it produces) quickly. It should also be able to operate at low generation levels.
3) State of the art forecasting, particularly for wind resources, needs to be made available to power system operators. 4) Wind production equipment needs to have "grid friendly" features, including low voltage ride through, voltage control and reactive power control.
5) Wind energy production must be curtailable by power system operators if wind production causes decreased power system reliability. The power system operators also must have the ability to set power ramp rates for wind projects if needed to ensure power system reliability. It is anticipated that these features will rarely be utilized, however it is less expensive to have these features that designing power systems to
handle the extremes of wind energy production. 6) Natural gas fired combustion turbines and pump-storage hydro plants arc a good complement to integrating intermittent renewable resources into existing power systems. Additionally, pump-storage hydro plants with variabic speed pumping capability provide even more flexibility to a power system. 7) Customer load shifting programs work well in integrating intermittent renewable resources. 8) Further studies, planning and system modeling will be needed as additional renewable resources come on-line to assure system reliability.
November, 2007 38 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
Recommendations:
Given these observations and recommendations from contemporary renewable resource integration studies, LADWP recommends the following for its own power system:
I) Refurbish Castaic unit 7. This unit provides automatic generation control for LADWP's power system. This unit should be refurbished and madc as efficient as possible. The use of this unit is expected to increase with increasing amounts ofrencwable resources. 2) Acquire state-of-the-art forecasting services for intermittent renewable resources, and integrate the use of these services into the operating practices and procedures for LADWP power system operators. 3) Wind farms that are owned and operated by LADWP should be equipped with controls that allow power system operators to limit power generation levels and ramp rates in order to maintain power system reliability. This same capability should also be incorporated into wind farm power purchase agreements. 4) Retrofit any hydro power plants along LADWP's aqueduct system to have the ability to follow load, if feasible. 5) The Haynes units 5 and 6 repowering project needs to emphasize quick start, low minimum load, high ramp rate operations and frequent cycling ability. Conventional combined cycle base load operations are not suitable for this project. Additional details regarding both the Haynes units 5 and 6 repowering and the Scattergood units i and 2 repowering projects are described in Recommendation 7 on page 41.
As LADWP increases its percentage of renewable resources (particularly as it approacbes the goal of35% renewables), additional mitigation measures and economic impacts should be evaluated, ineluding:
6) Retrofitting some Castaic pump-turbine units to have variable speed pumping ability.
7) Currently, tbe Castaic upgrade project is refurbishing 5 of the 6 pump-turbine units. Further studies should be done to evaluate if refurbishing the 6th pump-turbine unit is cost-effective, as the preliminary LADWP wind integration study indicated that Castaic would increase its pumping by 89% when the expected wind farms corne on-line. 8) Modifying LADWP's existing combined cycle plants to have the ability to operate at lower loads, and to be able to ramp their output more quickly. 9) Consider participating in any new pump-storage facilities or other energy storage technologies under consideration for development. i 0) Performing additional renewable resource integration studies.
Recommendation 6: Establish programs to enhance and expand electric transmission resources, particularly in gaining access to renewable energy resources.
LADWP should establish comprehensive programs to: (1) Expand its transmission system to gain access to renewable energy sources, (2) ensure continued adequate transmission capacities for power delivery from LADWP's remote generation resources, (3) take advantage of external
November, 2007 39 Los Angeles Department at Watcr and Power 2007 Integrated Resource Plan
power opportunitics to scrve its customers economically and reliably; and (4) maximize the usage of the transmission resources by marketing cxccss transmission to outside agencies.
The existing transmission systcm in the Western United States was not primarily designed with renewable resources in mind, with the exccption of hydro rcsources. Rather, it connects to many generation sources, such as coal, nuelear and natural gas facilities which arc generally located away from population centers. There are a variety of principle renewable energy locations within California, however many ofthesc locations have either no transmission, or limited transmission access. LADWP is proposing several new transmission lincs and projccts designed to increase the transmission capacity of existing lines. These inelude:
. Thc Grecn Path Coordinated Projects to gain access to renewable resourccs locatcd near the Salton Sea area. LADWP is pursuing a 80 MW Solar facility and two geothermal projects totaling 135 MW that would utilize the Green Path transmission system.
. Increasing the capacity on LADWP's lnyo-Rinaldi transmission line to gain access to wind and solar projects located in the Tehachapi and Mojave arcas. LADWP is pursuing the 120 MW Pine Trcc wind project, 4 additional wind projects totaling 600 MW, and 2 solar projects totaling 350 MW that would utilize thc Inyo-Rinaldi transmission line.
. Increasing thc capacity of LADWP's Southern Transmission System to gain acccss to renewable energy located in Utah and Wyoming. LADWP is pursuing two wind projects totaling 260 MW and a 40 MW geothermal project that would utilizc the Southcrn Transmission System.
Transmission for LADWP's remote power resources is generally adequatc to transfer LADWP sharcs of IPP, Navajo, Palo Verde, and Hoover, and these transmission lines to LADWP's remote generation resources arc rcquired to mcct peak load demand.
LADWP has bccn maximizing the usage of the transmission resources by selling excess capacities and voluntarily complying with FERC orders 888 and 889. Transmission, in excess of what is nccded to serve customer load, has been posted and sold on the Opcn-Access-Same-time- Information System (WesTTrans OASIS) - an elcctronic transmission service reservation system. Presently, virtually all excess transmission is sold on a short-tcrm and on availability basis through the OASIS. In addition, LADWP continuaiiy receives many long-term requests to purchase transmission for two or more years. To evaluate what would be considered "excess" of customcr load rcquircments, "Available Transfer Capacity" or A TC needs to be carefully calculated according to published criteria by the NERC and the WECC.
A comprehensive transmission program to calculatc A TC and enhance transmission network as nccdcd is required to ensure customer load is served reliably and economically, and to maximize the usage of the transmission nctwork. This is an essential part of the IRP process.
Detailed discussion of LADWP's existing transmission resources is provided in Appendix H.
Novcmber, 2007 40 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
Recommendation 7: Repower additional in-basin generation consistent with power system needs and environmental requirements.
Background:
The 2000 IRP recommended that LADWP repower io of its existing in-basin natural gas-fired units by replacing them with high etTciency combined cycle units. In addition, 6 smaller simple cycle peaking gas-fired combustion turbines were recommended to be installed as peaking units.
The repowering of these units was also in agreement with an August 29, 2000 Abatement Order and Settlement Agreement between LADWP and the SCAQMD and its May 28, 2003 revision. The projects resulting from these documents have been partially implemented as follows:
. At the Valley Generating Station, units 1,2,3 and 4 were decommissioned, and were replaced by a combined cycle plant consisting of two gas turbine generators and one steam turbine generator.
. Also at the Valley Generating Station, one simple cycle peaking gas turbine was installed.
. At the Haynes Generating Station, units 3 and 4 were decommissioned and Haynes units 5 and 6 were derated. These units were replaced by a combined cycle plant consisting of two gas turbine generators and one steam turbine generator. . At the Harbor Generating Station, five simple cycle peaking gas turbines were installed.
The other two combined cycle repowerings authorized by the 2000 IRP, incorporated into the SCAQMD Settlement Agreement and required to be in service by December 31, 2013 are: I) Haynes Generating Station (repowcring units 5 and 6) and, 2) Scattergood Generating Station (repowering units i and 2)
Best-Fit Repowering Technology:
Recommendation 4 indicated that power system operators cannot control or dispatch the production of energy from many renewable resources, so the remainder of the power system must be manipulated to accommodate both the changes in renewable energy production and the changes in customer demand. In general, with the addition of increasing amounts of renewable resources, the conventional resources of a power system must become more flexible in their ability to increase and decrease the amount of energy that is generated to successfully and reliably integrate new renewable generation.
Natural gas fired simple-cycle combustion turbines (or, simply gas turbines) offer a superior strategy for successfully integrating renewable resources into a power system's generation portfolio. Gas turbines provide the following advantages:
November, 2007 41 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
. Gas turbines can bc cyclcd on and off quickly. Gas turbine technology has been used extensively in the aircraft industry, and many gas turbines are designed for cyclic operation. This design feature allows the gas turbines to be quickly started when needed, and shut down quickly when not needed. This ability to cycle on and off quickly will assist power system operators in accommodating intermittent, non-dispatchable renewable resources, for example by starting quickly during times of decreasing wind, or stopping quickly during times of increasing wind. An additional benefit of gas turbine's ability to be shut down when not needed is the avoidance of the evening "carring cost" that other conventional gas- fired units incur by operating at their minimum generation levels during evening hours (since conventional units are not designed to be shut down daily) when the power system does not need the energy.
. Gas turbines have a short start-up time. Gas turbines can be started in less than one hour, and newer technology gas turbines shorten the start up time to less than io minutes. Such units can be considered as contributing to Operating Reserve (see Section 3.4), therefore these quick starting units add value to the power system even when they arc not operating.
. Gas turbines can mitigate environmental issues. The cooling water requirements for simple cycle units are relatively small and could be supplied with little or no once-through cooling water. Appendix C further addresses issues related to the Environmental Protection Agency's Clean Water Act Section 316(b) Phase II Cooling Water Intake Structure Rule (316(b)), and the
State and Regional Water Quality Control Board's issuance of the National Pollutant Discharge Elimination System (NPDES) Permits for the Haynes and Harbor Generating Stations.
. Gas turbines can be constructed approximately two years quicker that combined cycle units, due to their simplified design which does not include a steam turbine or associated steam piping.
However, the flexible attributes of gas turbines come at the price of a lower operating efTciency than natural gas-fired combined cycle units. Nevertheless, the operating effciencies of gas turbines are generaìiy superior to conventional gas-fired units.
Recommendation/or Repowering Haynes Generating Station:
Proceed with repowering Haynes units 5 and 6 (rated at a total of 600 MW) with an equivalent amount of gas turbines. This rcpowering should have an in-service date goal of 20 i i.
November, 2007 42 Los Angelcs Department of Water and Powcr 2007 Integrated Rcsource Plan
Recommendation for Repowering Scattergood Generating Station:
The Scattergood Generating Station (Scattergood) is located adjaccnt to the Los Angeles
Dcpartment of Public Works (LADPW) Hyperion Wastewater Treatment Plant (Hyperion). Scattergood and Hyperion work in conjunction already, in that the digester gases resulting from the Hyperion processes are dclivered to Scattcrgood's boilers, rcsulting in the gcneration of rcnewable energy. Additionally, some of the steam generated from Scattergood's boilers is delivcrcd to Hyperion for use in its trcatment processes.
As LADWP addrcsses the 316(b) and NPDES issucs, it now appears that there may bc a possibility for additionally synergy bctween Scattergood and Hyperion. When Hyperion completes its treatment of wastewater, the trcated efÌuent is released into the ocean. LADWP and LADPW have jointly agrccd to perform a study which will address the possibility of using
Hypcrion's efÌuent as a cooling mcdium for Scattergood boilers. The rcsults of this study are expected to be available in late 2007.
Whcn this study is completed, LADWP will then bc able to provide a rccommended strategy for repowering Scattergood. The repowering should have an in-service date goal of2013.
Recommendation 8: Ensure that the power generation, transmission and distribution infrastructure operates in a reliable and effcient manner. A Power Reliabilty Program initiated in 2007 will: . Improve maintenance practices and migrate to a more preventative maintenance program with Reliabilty Engineering guidance on priorities and schedules, . Address the aging Transmission and Distribution (T&D) infrastructure problem through increased replacement rates of aging assets, including poles, cables, transformers and other T &D assets,
. Increase capital programs necessary to support system load growth requirements and conversion to underground systems, and
. Increase staffng levels of construction and maintenance crafts, craft training programs, engineering, draftng and other groups that support reliabilty related work.
Rcliable electric powcr has been a cornerstone objectivc of the LADWP since it began offering municipal elcctricity in 1917. Historically, LADWP's Powcr System reliability has consistently
placed in the top quartile of the clectric utility industry and it is LADWP's goal to continue this into the foreseeable futurc. However, as a result of aging elcctrical distribution infrastructurc, there are significant challenges for LADWP to continue to maintain these reliability goals.
Novembcr, 2007 43 Los Angcles Dcpartmcnt ot Water and Power 2007 Integrated Rcsourcc Plan
The City of Los Angelcs has grown to the Nation's second largest City with a population of ovcr
4 million residents. Historically, most of this growth occurred between 1920 when there were roughly 580,000 residents and 1970 when the City had grown to ovcr 2.8 million residents. This incredible growth of 2.2 million residents coincided with the mass electrification of homcs and businesses throughout the Country and spccifically the City of Los Angeles. During this time, the LADWP installed tremendous amounts of electrical infrastrcture to cnsurc that these growing numbers of new homcs and businesses were supplied with reliable electric service. Scc Figurc 10 which shows the number of electrical distribution poles that were historically installed. Current (2006) pole count by year range installed
50000 46896
45000 I 43843 40536 40000 I.PoleCounlI 35096 35000
30000
25000 40 yrs old 20117 70 yrs old :;0000 15592 \1 15000 1 11850 11582 10240 10000 8862
5000 279 0 .~" .. :5 c:" dj 0," * ,,, r/ rJ:i" ,,;f ,,' yiro if'' 1",'0 ,." '1" ~' .' ,. ,'" "r:''' "o,r§ "o,'ò'" ," W b "at" ,,0,'S "0,,,,,. "",,p ,,0;"'''',0 r¡rS'' ..~"'r, ,~ ,~ ..rØ ..* ,,0, ..'" ,ë ..\'" ..l" --\'" -.n -l(o ~,. ~,. -l\'" -it' -it' -i& ",. -i(? -i(o ..(o -1\'" ..(o ,,'" Year Range Installed Figure 10: Electrical Distribution Pole Count
As a tcstimony to thc initial design and installation of this electrical infrastructurc, it has reliably served the residents of Los Angelcs ovcr thc last 40 to 70 years. However, data now shows that this rcliability is beginning to deteriorate. In the past few years, outagc ratcs have increased, ineluding several high profilc outages, demonstrating that this equipment is at the end of its
service life. As more of this infrastructure ages and thcrc is relatcd pcrformance deterioration, it creates a significant backlog of deferred maintenance and requires increased levels of rcliability enhancing capital work. Existing staffng and funding lcvels will not be sufficient to replace the infrastrcturc that is nceded to maintain the reliability that LADWP customcrs havc comc to expect
In order to maintain reliable elcctric powcr for Los Angeles, the Power Reliability Program has cstablished the following goals:
1. Make permanent repairs to Temporary Circuits and Open Circuits in less than 90 days.
Novcmbcr,2007 44 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
2. Electrical Station Maintenance will schedule preventative maintenance jobs with the following schedule: 20% of all maintenance jobs are preventative by July-2008, 25% by July-2009, and 30% by 2010.
3. Incrcasc the rate of pole rcplaccmcnt to equivalcnt ofa 60-ycar rcplacement cycle. 4. Replace underground cable to a rate of 60 miles per year, representing a 75 year replacement cycle. 5. Establish thc Distribution Infrastructurc Undcrgrounding program to underground 8 miles of circuits per year.
6. Replace one underground transmission circuit per year over each of the next 20 years, thus changing out all old cables by 2028. 7. Upgrade Distribution Transformer management and replacement programs to cffcctivcly replace all overloaded transformers, and aged transformers on a priority basis.
8. Increase Load Growtbjobs sucb as installation of new 4.8kv Feeders, 34.5 kY circuits and ncw Distribution Stations to bctter support new customer load. 9. Replace 12 deteriorated vaults per year. 10. Change out all obsolete equipment. 11. Rcplacc Rccciving Station Transformers on a 50 year replaccmcnt cyclc. Increase tbe
inventory of spare Distribution Station transformers to assure fast replacement of failed transformers. 12. Reducc to an acceptable level the backlog of outstanding record maps and finalize contractor vendor drawings over a six year period. Complete conversion of drafting records to the Geospatial Electric Model to support the Outage Management System and Electric Trouble operations.
The Power Reliability Program proposes to increase staffng by 337 new positions over the next three years in order the meet the goals described above. These positions will include tbe following classifications of employees:
. Electrical Distribution Mechanics and Trainees Electrical Mechanics and Trainees . Electrical Craft Hclpers Electrical, Mechanical & Civil Engineering Associates Electrical & Civil Drafting Technicians Electrical Testers and Senior Electrical Testers Others, including Clerk Typists, Management. Analysts, Office Engineering Technicians, etc.
4.3 Summary and Conclusion
This 2007 Integrated Resource Plan is designed to provide LADWP with a comprehensive approach to long-term planning that also has the flexibility to meet changing needs. While this document provides a snapshot of the key issues related to resource planning in this cbanging environment, it is important that these issues are evaluated on an ongoing basis.
November, 2007 45 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
While much of the focus of this 2007 IRP centers around the Renewahle Portfolio Standard Policy, the rest ofthe power system should not be forgotten. Older in-basin generation units, and also the Castaic pump storage plant, need to be addressed by refurbishment or replacement, especially to support the intermittent nature and evening delivery otthe bulk of wind energy that will be injected into the power system. An adequate amount of generation, equal to or greater than customer requirements, needs to be built or acquired. Also, developing programs for transmission system enhancements will enable access to more renewable energy for many years to come.
It is critical that LADWP continue this planning process to ensure that informed decisions arc made with regard to LADWP's ability to meet its future load growth and maintain system reliability. By taking actions to achieve the recommendations set forth in this 2007 Integrated Resource Plan, LADWP can continue to meet its goals of providing reliahle service to its
customers, remaining committed to environmental leadership and maintaining a competitive pnce.
November, 2007 46 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Appendices
Appendix A: Generation Resources Appendix B: Load Forecasting Appendix C: Environmental Issues Appendix D: Renewable Portfolio Standard (RPS) Policy Appendix E: Energy Efficiency and Demand Side Management Programs Appendix F: Distributed Generation Appendix G: Fuel Procurement Issues Appendix H: Transmission System Appendix I: Glossary
November, 2007 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Appendix A. Generation Resources
LADWP's generation resources are summarized below, and the generation facilities located outside (or, external to) the Los Angeles are presented in detail at the end of this Appendix.
Basin Thermal Generation
There are four natural gas-fueled generating stations in the LADWP system located within the Los Angeles Basin: Harbor, Haynes, Scattergood, and Valley. Based on recommendations from the 2000 IRP, six peaking combustion turbine units were installed in 2001. Additionally, six generating units in two generating plants were repowered and replaced with two combined cyele units. LADWP's natural gas-fueled generating plant capabilities are shown in Table A-I.
Coal-Fired Thermal Generation
LADWP's coal generating capacity comes from the Navajo and Intermountain Generating Stations.
LADWP's purchase entitlement of the two-unit Intermountain Generating Station's net output is 48.617%, and in addition can purchase a varying amount from other entitlement holders that is in
excess of their needs. LADWP's purchase entitlement of the three-unit Navajo Generating Station is 21.2 %. LADWP's coal-fueled generating plant capabilities are shown in Table A-I.
Nuclear-Fueled Thermal Generation
LADWP's interest in the three-unit Palo Verde Nuelear Generation Station is 9.7%, of which 5.7% is through direct ownership, and 4% is through participation with the Southern California Public Power Agency (SCPPA). LADWP's nuclear-fueled generating plant capabilities arc shown in Table A-I.
Large Hydroelectric Generation
LADWP's large hydroelectric facilities include the Castaic Pumped Storage Power Plant and
entitlement ofa portion of the Hoover Power Plant. LADWP's hydroelectric plant capabilities are shown in Table A-I.
November, 2007 A-I Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Renewable Resources and Distributed Generation
LADWP eligible renewable "small hydro" resources includes the Owens Gorge, the Owens Valley and the Los Angeles Aqueduct hydroelectric plants. Other LADWP renewable resources and distrihuted generation include:
. Pleasant Valley Wind Project (82 MW)
. Powerex small hydro (50 MW)
. Digester gas from the Hyperion Treatment Plant used at Scattergood (22 MW)
. Solar Photovoltaies in the Los Angcles area (II MW)
. Bradley landfil gas (6 MW)
. Penrose landfil gas (6 MW)
. Lopez Canyon landfill gas (2 MW)
. Fuel Cells (2 MW) Additional information on Renewable Resources and Distributed Generation can be found in Appendices D and F.
November, 2007 A-2 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
~ , Table A~ I: Capability otTn~Basin Generating Stations
I" Service Ag' Net Unit MaxÎmulI Net Maximum Net Depcndable Comments Name of Plan I Fuel Source lJiiiiNo. Date (Years) (Capability, LADWP's Plant Capability Plant Capabilty Sharc,MW) (MW) (I) ('-W)(2) HarborGcncratingStaiion Natural Gas 1 1995 12 R2 466 461 Uriits1,2and50per¡ile 2 1995 12 "' as a combined cycle unit 5 1995 12 65 10 2001 6 47.4 11 2001 6 47.4 12 2001 6 47. 11 2001 6 47.4 14 2001 6 47.4 Ilayncs Generating Station Natural Gas 1 1962 45 22 i 5~4 1,565 Units8,9and 10 operate 2 1963 44 22 as a combined cycle unit 5 1966 41 32 6 1967 40 243 8 2005 2 235 9 2005 2 170 10 2005 2 170 Scatt~rguodGcricrat;ng Station Natural Gas 1 1958 49 161 795 774 22 MW for Hyperion 2 1959 48 184 3 1974 33 450 VallcyGcrieratingStaiiuri l"aturalGas 5 2()D) 6 43 576 554 Unils 6,7 and 8 operate 6 2003 4 159 as a combined cycle unit 7 2003 4 159 8 2(0) 4 215 Total Net De eiidablc Ca abili ofr'atural Gas Stations 3,421 3,354 lnt~miuUritainGeneratingStaiioii Coal 1 1986 21 519 1038 1.038 See Note (3)
2 1987 211 519 Navaju lieneraiing Station Cual 1 1974 33 159 477 477 2 1974 33 159 3 1975 32 159 'vuhaveGeneratingStation Coal 1 1971 36 68 0 11 Shut down on 2 1971 16 68 December31,2005 Total Nct De cndableCa abil of Coal Stations 1,515 1,515 Palu Verd~ (j~neraiing Station \luclear 1 1986 I 21 I 129 388 367 2 1986 21 I 129 1 1988 19 no Total Net De eiidableCa abilit of Nuclear Stations 388 367 Castaic Power Plant Hydro Various 1972-1978 2935 1175 1175 1,075 PumpedSlorage Huuvçrl'owcrl'laiit I Hydro Various 1936 71 491 491 460 Total r'etDe endableCa abilit or"Lar e" HvdroStations 1,666 1,535 AaucductSystcm Hydro Various 1917-1987 20-90 87 87 40.6 11Unilslotal Owens Vallcy System Hydro Various 1909-195g 49-99 112 112 5,1 7 Units tolal Owens Gorge System Hydro Variou, 19521953 5455 112.5 112_5 109.4 3 Units total Landfills, Solar, Fuelcelb RenewablcfD(j Various wö a/a 130 130 130 See Note (4) Total Net Dependable Capabilit ofllenewables/DG 341 285 Total Net De endableCa abilit ofLAn,,"p Resources 7,331 7,056 Statc's Capacity Entitlement ~5 ~5 Total ~et De endable Ca abilitv or LADWP System 7,266 6,991 See Nole (5)
Noles: (i) Maximum capability may b~ oblairied uiily w\i"" ¡h" weaihcr amI t:quipllLt;ri, ai-c ;;imultancuüüsly il optimal conditio", (2) lkpendable capability may be obtained al any iime with nonnal auxilaires in servi"e (3) This value includes I.ADWP's cntitlcment share, and excludes the r~callable amount from other entitl~ment holders (4) Includcs l-yperion Treatrn""t Plant, Penrosc and Bradley landlÏll" Lopez Canyon and Bradlcy microturbiri~s, Solar PVs and Fuel Cells, and DG (14 'vW) ('i)-lnis amount varies with unit outages, d,,-ratings and sale ,obligations.
November, 2007 A~3 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
External Generation Contract Terms and Related Issues
Intermountain Power Project (IPP)
. LADWP's agreement began on February I, 1983 and ends on June 15,2027. There is an extension clause providing for continuation of entitlement shares of project output. Additional information regarding IPP's fuel procurement strategy is found in Appendix G. . LADWP is entitled to receive 44.617% ofthe plant's capacity rating. LADWP has also
purchased a 4% entitlement of the plant from Utah Power and Light. Both of these entitlements are valid until the 2027 contract termination date. In addition, LADWP can receive up to an additional 18.168% entitlement under the Excess Power Sales Agreement, however this percentage, or portions of this percentage, can be recalled from LADWP by other IPP participants, given certain defined advanced notices.
. Over the past several years, the IPP units have had several substantial modifications, including cooling tower additions, high pressure turbine replacements, boiler capacity additions, distributed control system replacement, scrubber outlet modifications and rebuilds, and induced draft fan drive replacement. These modifications have decreased emissions and increased plant efficiency. They have also increased the plant's capability by 140 MW, resulting in a 68 MW increase in capability for LADWP.
. Over the last several years, some of the Utah municipal participants of tbe IPP bave exercised their recall rights for IPP power. LADWP has been receiving approximately 300 MW from the Utah municipalities under an Excess Power Sales Contract since the start up of the project. In addition, the Utah municipalities have indicated an interest to construct a third IPP unit. LADWP has stated that it will not participate in the ownership of a new IPP unit 3.
Mohave Generatin£ Station
. On December 23, 1968, LADWP and Southern California Edison (SCE) executed the Plant Site Conveyance and Co-Tenancy Agreement Assignment affecting LADWP participation as a 20% participant in the ownership, use, and operation and maintenance of the Mohave project. On November 27,2001, Los Angeles City Council approved the sale of 50% of LADWP's share to Salt River Project (SRP), reducing LADWP's ownership to 10%.
. The Mohave Operating Agent is SCE.
. Pursuant to the Consent Decree as settlement of the litigation brought upon the Mohave Generating Station by the Grand Canyon Trust, et. aI, the Mohave Generating Station was to install emission control systems, namely scrubbers and baghouses by December 3 i, 2005 in order to continue operation beyond 2005. The total capital investment for the installation of emission control systems, retrofitting the plant, refurbishing the coal slurr pipeline, obtaining water for coal transportation and plant operation, and royalties was estimated at about S I billion. LADWP's share would have been about $ i 00 million.
. As of December 3 1,2005, the Mohave Generating Station ceased operations.
November, 2007 A-4 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
. As of July 2007, the owners agreed to proceed with full decommissioning of the entire plant.
-, Navajo Generatin)! Station
. On March 23, 1976, LADWP, Arizona Public Service Company (APS), Nevada Power Company (NPC), SRP, Tucson Electric Power Company (TEP) and U.S. Department of Interior executed the Navajo Project Co-Tenancy Agreement effecting the participation as
co-owners, operation and maintenance of the Navajo Project until December 31,2019.
LADWP's entitlement of the Navajo Generating Station capability is 21.2%.
. The Navajo Operating Agent is SRP. . The Navajo Generating Station has completed the installation of scrubbers to remove SOx in all three units of the plant.
Palo Verde Generatin)! Station
. On September 12, 1983, SCPPA entered as a 5.91 % participant in the Arizona Nuclear Power Project. LADWP, through a power and energy purchase agreement is entitled to a
67% ofSCPPA's 5.91 % share of generation in the three units of Palo Verde.
. On January 10, 1987, LADWP through an exchange of ownership with SRP's Coronado
Station acquired 5.7% share of Palo Verde. . The three Palo Verde units have an effective life of 40 years that runs until 2027.
. The Palo Verde Operating Agent is APS.
. One major capital expenditure that was approved in 1999 was the replacement of steam generators in Unit 2. This work was completed in 2003 which increased Unit 2's net capability by approximately 71 MW. Unit 1 underwent a similar upgrade in 2005, and Unit 3 is scheduled for similar work in 2007.
Hoover Power Plant (Boulder Canvon Project)
. The Boulder Canyon Project Electric Service Contract between the Western Area Power Administration (W AP A) and the 15 contractors (LADWP, SCE, Metropolitan Water District, Arizona Power Authority, Colorado River Commission, Anaheim, Burbank, Pasadena, Glendale, Riverside, Azusa, Colton, Vernon, Banning, Boulder) took effect on June 1, 1987. This is a renewal contract of the original Hoover contract, which expired in 1986. This contract will expire on September 30, 20 i 7, without guaranteed right to further renewaL. . Hoover has 17 units, plus 2 service units for a total capacity of 2,079 MW. . The Mead substation is the delivery point. W AP A is the marketing agent and the Bureau of Reclamation is the operating agent.
November, 2007 A-5 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
. LADWP is entitled to receive 491 MW (25.15%) of Contingent Capacity and 694,185 MWh
of Firm Energy (15.4%) from Hoover. However, due to decreased Lake Mead elevation levels, LADWP's capacity was reduced to 460 MW through December 31,2005.
Resource Forecast A summary of the resource forecast is shown in Section 3.5, Table 1. Table A-2 provides a more detailed summary of individual resources, and is included below.
November, 2007 A-6 Z Table A-2 0l' 0 '" "~ Generating Resources and Capacity Sales/Purchases 3 5' "a- (Megawatts) (J" v"" '" N 2007 2008 2009 2010 2011 20\2 2013 2014 2015 2016 2017 20LS 2019 2020 2021 2022 2023 2024 2025 2026 2027 '" a RENEWABLES (1) tl --a Hioma,s-Hypcrion ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii ii " Digc,ter Gas - RFP , , , , ; ; 5 5 5 5 5 5 5 5 5 5 5 ; 5 5 ~ Geothermal - Rl-P 76 "6 273 273 27 27 27 273 273 273 27 27 27 27 27 27 27 273 ~ Landfill (3) B B B B B B B B B B B B B B B B B B B B B 3 Landml-llYl 3 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 3 3 3 " MuniSolidWa,teCoii\'crsjon 23 45 68 90 90 90 90 90 90 90 90 90 90 90 90 90 90 ~:: Small Hydro (2) 2n in in in in in in in in '" in in 2n in in in 2n 2n in in in Small Hydro - RFP 4 4 7 9 9 9 9 9 9 9 , , 9 9 9 9 , , 9 0 S"IHT , 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 ,. Solar-Rl"P B n " 23 '" 22 23 240 247 254 260 260 260 260 260 260 260 260 260 260 260 :: Wind-I'incTree(4) " " " n n n n n n n n n n n n n " n n ~po Wind-RFP(4) ii '3 H8 H8 n8 n8 H8 H8 US US n' n' n8 n8 n8 n8 "" "" "" """ I'uclcclls-Renewable 2 2 2 2 2 2 2 , 2 2 2 2 2 2 2 2 2 2 2 2 2 po Renewahle Contrach (15) 58 58 5' '" , 8 , , , , 8 , 8 8 , , :: Toi..IRcnewable J2 324 373 527 709 953 "" 1012 1019 1025 1032 1032 Hl32 Hl32 1032 1032 1024 1024 HI21 1021 1021 p. "0 Green Power for a Green LA 0 See Table 5 , , '" n n B " " " " 20 ii 24 26 28 30 32 34 36 38 40 :i """ PUMPED STORAGE :i CAST Aie (5) 1175 1195 1215 1235 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 1255 --, :\'ATURAL GAS HARBOR CC (units 1, 2 & 5) 22 22 22 22 22 22 22 22 22 22 22 22 22 22 22 22 22 22 229 22 22 HUTborGT 10 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 HarborGT 11 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 lIarborGT 12 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 N HarburGT 13 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 a HarborGT 14 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 47 a Hayne" I m m m m m m m m m m m m m m m m m m m m m -- Haynes 2 m m m m m m m m m m m m m m m m m m m m m ~ " " 0 :: Hayne. 5(6) 322 322 m m m 0 0 0 0 0 0 0 0 0 0 0 0 0 ~ Haynes 6(6) 24 243 243 243 24 0 0 0 0 " 0 0 0 0 0 0 0 0 0 0 0 " 575 575 575 575 575 575 575 575 575 (J Haynes CC(unils8,9& 10) 575 575 575 575 57 57 57 57 57 57 57 57 "" Haynes Gas Turbines 600 600 600 600 600 600 600 600 600 600 600 600 600 600 600 600 po Scattergood 1 1" 1" 1" 1" '" '" '" 1" 1" 1" 1" (7) '" "1 "1 '" '" '" m m m '" " Scattergood 2 I"' '"' '"' "4 '"' '"' I"' 1"' '"' 184 184 184 184 184 1"' 1"' 1"' 184 '"' '"' '"' p. Scatterguud3 450 450 450 450 45 450 450 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ;0 Scattergood Repowering 450 450 450 450 450 450 450 450 450 450 480 450 450 450 '"" Valley 5 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 43 0 Valley CC (unils 6, 7&8) 533 m m m 533 533 533 m m m 533 533 533 533 m 533 533 533 m m m C TOTAL GAS 3421 3421 3421 3421 3421 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 3456 "" "() COAL 3! MOHA VF. I (8) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 po MOHAVE 2 (8) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 :: I\AVAJO I 159 159 159 159 '" B' 159 B' 159 159 '" B' 159 0 0 0 0 0 0 0 0 NAVAJO 2 159 "9 B' B' B' 159 159 189 189 189 189 B' 159 0 0 0 0 0 0 0 0 NAVAJO 3 B9 159 159 159 '" '" 159 189 B' 159 159 189 189 0 0 0 0 0 0 0 0 ICSL(9) 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 IGS2(9) 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 402 TOTAL COAL 1280 1280 1280 1280 1280 1280 1280 1280 1280 1280 1280 1280 1280 803 803 803 803 803 803 803 803 z r 0 Table A-2, continued '"0 "'" 2007 2008 2009 2010 2011 2012 21113 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ;i NUCLEAR (10) :: g. (¡ " PALO VERDE i 129 129 129 12 129 12 12 129 129 129 129 129 12 129 129 129 12 12 12 129 129 (1 ".. PALO VERDE 2 129 12 12 12 129 129 12 129 129 129 129 129 12 12 12 12 12 12 129 129 129 '"" N PALO VERIn: 3 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 130 0 TOTAL NCCLEAR '" 388 388 388 JK 388 38' "8 388 388 388 388 388 388 388 388 388 388 388 388 388 c: 0 (1 .. "0 PURCHASES " ..~ 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 491 HOOVER (11) :3 IPP-EXCESS POWER (12) 162 137 11 87 62 37 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (1 IPP-LP&L(13) 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 72 ::~ TOTAL PURClL\SES 725 700 675 650 625 600 563 563 563 563 563 563 563 563 563 563 563 563 563 563 563 0-, ITOTAL RESOURCES 7319 7317 7362 7512 7691 7946 7939 7970 7978 7986 7994 7996 7998 7523 7525 7527 7521 7523 7522 7524 7526 "~ DG(14) 12 23 38 49 62 80 100 12 151 17 204 202 200 198 196 194 192 190 188 186 184 ~ ..(1 " Total Resource~ 7331 7340 7400 7560 7752 8025 8039 8093 8129 8162 8198 8198 8198 7721 7721 7721 7713 7713 7710 7710 7710 :: p. State's Capacity Entitlement -65 .65 -65 -65 -65 -65 -65 -65 .65 -65 -65 -65 -65 -65 -65 -65 -65 -65 -65 .65 .65 0"0 Net Dependable Sy~tcm Capacity 7266 7275 7335 7495 7687 7960 7974 80211 11064 8097 8133 8133 8133 7656 7656 7656 7648 76411 7645 7645 7645 :i ..(1 :"otes:
;i, (1) Estimates associated with the Renewable Portfolio Standard, to provide 20% energy by 2010. See Table D-1 for additional assumptions. 00 (2) SmalllIydro includes the Aqueduct plants (11 units, 85 MW total rating), Owens Valley (7 plants, 11.2::W total rating) and Owens Gorge (3 units, 112.5:\W total rating). PP2 unit 3 upgrades from 18 to 20 MW in 2006. (3) Landfill includes Lopez Canyon and Bradley microturbines, and Penrose Canyon and Bradley Landfils (4) Wind resources are shown with a 10% Dependable Capabilty, duc to the winds intermittent and unproven nature. For example, the 120 MW Pine Tree is shown as 12 .\1\\'. (5) Castaic Capaeity increase 20MW per year heginning in 2006 for a total of80:\W added b~' 2011. N (6) Haynes 5 and 6 are scheduled to be derated hy December 31, 2007, and repowered by 2011. o (7) Scattergood 1 rated at 183 minus 22 = 161, with 22 MW accounted for as Hyperion digester gas. o generation on-site. .. (8) Mohave is assumed to be not available after Decemher 31, 2005. l\evertheless, there are various plans to continue some type of - (9) Based on 44.62% DWP entitlement. This docs not include 4.0";', capacity purchase from UP&L, or the 18.168% Excess Power Sales shown under ll:RCHASES (see notes 10 & 11). ~:: (10) Unit 2 was uprated in December of 2003. Unit I is scheduled to complete its uprate in January 2006, and Unit 3 is scheduled to be uprated in 2007 " (11) Hoover contract with WAPA expires September 2017, contract extension assumed. (¡.. (12) Excess Power purchase of IPP generation froir Utah .vunicipalities is recallahle under the terms of the contract. .\1aximum is 18.168%. ~" Current 162 MW non-recalle,d amount is assumed to decrease to zero by 2013, representing growth of Utah municipalities. " 0. (13) Purchase of 4% of IPP net generation from UP&L. (See note 9.) (14) Projections from EE, DSM aiid DG programs. See Table F-3 "i' (15) Wyoming Wind at 82MW (dO%), BC Hydro at SOMW '" "o ".. (1 "0 ¡; :: Los Angeles Department of Water and Power 2007 Integrated Resource Plan
-, Appendix B. Load Forecasting LADWP Load Forecasting Process
. i The October 2006 Retail Sales and Demand Forecast (October 2006 Forecast) is a long-run projection of electrical energy sales, production and peak demands in the City of Los Angeles and Owens Valley. A flowchart of the forecast process is illustrated in Figure B-1.
Figure B-1: Overview of the Load Forecasting Process
November, 2007 B-1 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Data collection is the first step in the process. LADWP purchases a demographic and economic forecast of Los Angeles County from the Los Angeles Modeling Group of the UCLA Anderson Forecast Project. The Los Angeles County Forecast provides time series data for various demographic and economic statistics beginning with year 1991 and continuing through the forecast horizon. LADWP also reviews the State of California Department of Finance demographic forecast for population data. To gain further insight into economic growth patterns, LADWP purchases a construction forecast from McGraw-Hill Construction service. The construction forecast gives a five-year view of construction projects detailed by building types. Weather also affects energy sales and demand. Weather data is collected from three key stations - Civic Center, Los Angeles Airport, and Woodland Hills. The other key components in the forecast result from LADWP's own internal data. Historical sales, Net Energy for Load (NEL), billing cycles, electric price and budget data are all incorporated into the forecast. The economic, demographic, weather and electric price data are the key inputs to the models that forecast retail electric sales.
In the best of all worlds, economic output (GDP) would be the key driver of an electricity forecast in Los Angeles. However GDP data is not available at the local level so proxies of GDP such as employment and personal income data arc used in its place.
The retail sales forecast is divided into six separate customer elasses in eluding residential, commercial, industrial, intradepartmental, streetlight and Owens Valley. The residential, commercial, industrial and streetlight classes are commonly used sales elasses throughout the electric industr because they represent relatively homogeneous loads. Intradepartental sales are sales to the Water System and are primarily related to water pumping activities.
Owens Valley sales inelude all of the above sales elasses. The Owens Valley service area is separate and discrete from the Los Angeles service area. Because of limited land available to be developed, Owens Valley sales exhibit very slow growth rates and total sales arc relatively small compared to total LADWP system sales. As such, Owens Valley sales are rolled into a single class and forecast separately.
The forecast model consists of six single equations - one equation for eaeh customer class. For the residential, commercial and industrial sales elasses, the equations arc estimated using Generalized Least Squares regression techniques. Historical Sales for each customer elass are the dependent variables. Sales are regressed against a combination of the demographic, economic, weather and electric price variables. Binary variables are used to account for extraordinary events like earthquakes, civil disturbances, billing problems, and the California Energy Crisis. The equations fit historical data quite accurately producing coeffcients of determination (R-Squared) statistics greater than 80 percent. For the streetlight, intradcpartmental and the Owens Valley sales classes, time trend models arc used. The results of the six equations are summed to forecast Total Sales to Ultimate Customers (Sales).
The NEL forecast is a function of the Sales forecast. The NEL is forecast by adjusting annual forecasted Sales upward by a historic average loss factor and then allocating a portion of the annual energy to each calendar month based on historical proportions. Loss factor has the
November, 2007 B-2 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
potcntial to changc on the way that the System is run. Electricity generated in distant places will have a higher loss factor than electricity generated located locally. Thc changc in loss factor is accounted for in the resource planning modcls. -, The next step is to forecast annual peak demand. The drivers for forecasted pcak dcmand arc temperature, load growth, and time of the summer. The temperature variable used in the estimation is weighted-average of three weather stations. It incorporates heat buildup effects and humidity. Temperahie is than divided into splines so that we estimate a unique megawatt-
response per degree for different levels of temperature. Ordinary Least Square regression techniques are used to model maximum wcckday summer daily hourly demand against the tcmpcrature splines and the time of the summer. The constant that is estimated from the regression model is assumed to be the weather-insensitive demand at the pcak hour. To forecast the peak demand, we assume that thc peak will occur in August and that the peak day temperaturc is equal to thc fort-year historical mean peak day temperature. Peak Demand then is assumed to grow at the same rate as sales.
The forecast process dcscribed above produces the trend (or base case) forecast. LADWP also produces alternative peak demand forecasts. LADWP wants to ensure that it can meet nativc demand with its own resources. System responsc to weathcr is uncertain. Temperature and humidity are the primary influenccs but other variables such as cloud cover and wind speed can also influence the load. The problem is further complicated by the fact that LADWP serves three distinct climate zones including the Los Angeles Basin, the Santa Monica Bay Coast and the San Fernando Valley. To prcpare for thcsc unccrtainties, LADWP formulates its alternative cases by examining expected demands at different temperatures. Based on the Central Limit theorem, we can assume that the normal distribution produces unbiased and efficicnt cstimators of the true distribution of peak day tcmpcratures. The normal distribution is estimated trom the forty-year historical sample of peak day tcmpcratures. From the normal distribution, we can determine the probability that the peak day temperature will be below a given temperature. For the onc-in-tcn case, it is the given temperature where ninety percent ofthc timc thc actual peak day temperature
is expected to be bclow it and ten percent of the time the actual temperature will be above it. Similar calculations are performed for the one-in-five and one-in-forty cases. Thesc temperatures are input into the peak demand regrcssion modcl to provide the alternative peak demand forccasts.
Peak demands during the July 2006 Heat Storm exceeded the October 2005 Forecast l-in-40 case by 150 MW. The event is now included in the October 2006 forecast which resultcd in a higher annual peak demand forecast for the I-in-IO and i -in-40 cases. The July 2006 Heat Storm is characterized by its long duration. There is no similar event in the 42-year database that is used to determine the weather cases. Usually annual peak demand occurs on thc third day of a
three day heat storm if that day occurs on a non-holiday weekday. However, the Global Warming theorists forecast that California will encounter more frequent heat storms oflonger duration over the next i 00 years. The Load Forecast group has begun preliminary research on building longcr duration into the peak demand models. The results will be incorporated into thc October 2007 forecast.
Novcmber,2007 B-3 Los Angelcs Dcpartmcnt ofWatcr and Powcr 2007 Intcgratcd Rcsourcc Plan
Thc final stcp of thc proccss is to forccast a monthly pcak dcmand and load for cach hour in thc ycar. Monthly pcak dcmands, outsidc of thc August annual pcak, arc forccast using thc load factor formula. Thc historical avcragc monthly load factor and thc forccastcd NEL for cach month arc thc known inputs. To forccast load for cach hour of thc ycar, wc usc thc Loadfarm algorithm dcvclopcd by Global Encrgy. Thc inputs into Loadfarm arc a historical systcm load shapc, monthly forccastcd cncrgy and monthly forccastcd pcak dcmand. Thc systcm load shapc is dcvclopcd using a rankcd-avcragc proccdurc pcrmuting historical loads so that all pcaks occur on thc fourth Thursday in August. Tablc B-1 contains thc numcrical Octobcr 2006 Forccast.
Thc Octobcr 2006 F orccast is a forccast of potcntial cncrgy growth in thc City of Los Angclcs scrvicc arca. It is important to notc that somc of thc load growth in thc Forccast will ncvcr bc rcalized within thc LADWP salcs and cnergy accounting systcms bccausc of thc installation of encrgy cflciency and distributcd gcneration technologies.
November, 2007 B-4 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Table B-1: Trend Case Energy Sales and Peak Demand SECTOR SALES Total Net Energy Peak Residential Commercial Industrial Other* Sales for Load Demand Year (GWh) (GWh) (GWh) (GWh) (GWh) (GWh) (MW) Actual ¡;Wl__i,,£W,£FF:;--!"¡S""\"""lt'"_íl"'IWil_i¡1iil.iW""'''!!¡¡¡n__li'_I_¡¡_4,¡¡!,;j'1',;;i~'~"'¡'íi"¡¡," r~l¡l¡~LWbd~L~~~i2t1&m§i~Ju'l:!~Wf"t~~:%~.:~~1h1;~1t~i:,j/t:d~\i:1),,'::;;:"9À1),~1'1"f,~,L~2~'!1991 6,615 11,289 3,002 526 21,432 24,066 5,100 1992 6,995 11,472 2,858 491 21,816 24,409 5,279 1993 6,726 11,366 2,589 450 21,131 23,802 4,650 1994 6,706 10,824 2,364 501 20,395 22,998 4,958 " ',¡¡';"'rWW! "lr7_"';~'ij¡Jilfi,~$j!7';'7"!m!!l',"¡I!IIF""'''¡''~_1Ifi;l''i!!_¡¡rs"":i.,-i""""¡W",__'-"¡'i"'!!'i" ~!4i:l~,;%'k';;t"glZJtj;%$~!lW;1i~fJAijUJi.:~lf;il;"§W4L\j~:2DEléf¿;~d.ll1Y£tØߊ-~:R~~1)ll;itWdi~~"flRi?ØLt§:ímt'§IEt;(m'i~,~S~~5t~1H~Ì$4bi,;J1996 6,914 11,259 2,568 527 21,268 24,252 5,111 1997 7,101 11,535 2,628 539 21,803 25,009 5,492 19991998 7,183 39 11,387 11 2,601 594 525 21,69621 24,582 5,630
2001 7,314 11 25,058 4,805 2002 7,345 11,957 2,455 535 22,290 25,301 5,185 2003 7,792 12,228 2,4 76 545 23,041 26,110 5,410 2004 7,925 12A09 2,449 560 23,343 26,521 5,418 Forecast ~\kr~~~G~níW~~S¥~g~~~Æl~~'L:W1ti~~'I¿~~.:Ø1tli¡.':%E~~1ß:f&,;¿i'r"_''';.'''l¡l''''''''~''_''l'';'WÆi''_;i''''_''_¡'''17I'''''_~'''''~ilg___æ"""i£"""j"¡,,.i¡¡i¡"""~'¡iE"",,"íit 2006 8,002 12,852 2,384 567 23,804 26,898 5,539 2007 8,116 13,101 2,404 567 24,189 27,332 5,608 2008 8,231 13,383 2,416 567 24,598 27,794 5,702 2009 8,327 13,576 2,412 568 24,883 28,116 5,768 fìP:~_'~1c~1'"BlIlJJIll:tl__~~Ii;gar.')1~i2011 8,556 13,923 2,398 568 25,445 28,751 5,899 2012 8,680 14,067 2,389 569 25,706 29,046 5,960 2013 8,803 14,206 2,384 569 25,962 29,335 6,019 2014 8,928 14,346 2,382 569 26,226 29,633 6,081 ~~~,M~t-&ì~~'Ø\_1lFA~~it~§.____'i¡,'iJi¡"ti;2~_'l"m.;".¡i"__'~;i,._¡'''¡¡,''W''~'".;¡'j.,'¡''Tl-"'311Zfii¡_-'""" 20172016 9,1809,308 14,67414,845 2A082,397 571570 27,13226,821 30,65730,306 6,2916,219 2018 9,452 15,012 2,421 571 27,456 31,024 6,367 2019 9,593 15,179 2,434 572 27,778 31,387 6,441 ¡¡"_~_""J_","¡i¡¡;sii¡¡¡il¡¡¡¡iil',%I¡¡¡'ií1'i'¡;'ii;¡I'¡Il!W_¡¡"¡¡.t¡rÆ' - , '¡!,!!m.."",', ,~~~~;æi~lt~~£m&¥l,ti.i2021 9,920 15A95 2,462 ",",:.~";,'573 28,450 '" '""~"~/:~iW~j;"j32,146 6,598 . , 2022 10,072 15,628 2,472 573 28,745 32A80 6,666 2023 10,231 15,752 2,482 574 29,039 32,812 6,735 2024 10,398 15,875 2,492 574 29,340 33,153 6,805 E'-~2026 10,743 "~~_!'!!j 16,114 2,512 575-_.~ii"'''ß''lI 29,944 33,492 6,946 2027 10,924 16,235 2,523 576 30,258 33,835 7,018 2028 11,091 16,356 2,534 576 30,557 34,189 7,089 Ii2029 r&~-I' 11,250 16,477 u LJ¡_!lilL~ 2,545 577 30,849 34,528_í-~~ 7,158 Table updated through September 2005,
Annual Percent Change 1990-2000 0.96% 0.72% -1.54% 0.66% 0.50% 0.50% -0.02% 2000-04 1.32% 0.46% -1.83% 0.08% 0.48% 0.56% 0.56% 2004-10 1.05% 1.73% -0.30% 0.24% 1.26% 1.17% 1.24% 2004-17 1.25% 1.39% -0.13% 0.15% 1.16% 1.12% 1.16% 2004-25 1.38% 1.22% 0.10% 0.12% 114% 1.07% 1.14%
* 'Other' includes Streetlighting, Owens Valley, and Intra-Departmental
November, 2007 B-S Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
Appendix C. Environmental Issues
Overview
LADWP's mission includes a role as an environmentally responsible public agency. LADWP continues to develop and implement programs to improve the environment, including:
. Providing 20% of our customer's energy needs from renewable energy by the year 2010 through the development of wind, solar, geothermal and biomass energy sources and acquiring the associated transmission required to transmit such energy to Los Angeles.
. Prioritizing the use of Energy Effciency (EE), Demand Side Management (DSM), renewable Distributed Generation (DG) and other renewable resources.
. Completion of the implementation of Best Available Control Technology for NOx controls in its Los Angcles in-basin cleetrieal generating plants.
. Reducing the emissions of greenhouse gases by at least 5% below 1990 levels by 2012.
. Supporting the City to meet its Climate Action Plan (CAP) goal ofa 30% reduction in greenhouse gas emissions by 2010. More information regarding the City's CAP can be found at: http://ww.lacity.org/ead/EADWeb-AQD/lac1imateplan.htm.
. Supporting the City and the Bureau of Sanitation through Hyperion gas usage and future participation in municipal solid waste to energy programs.
Emissions of Oxides of Nitrogen (NOx)
Oxides of nitrogen, or NOx, is the generic term for a group of highly reactive gases, all of which contain nitrogen and oxygen in varying amounts. Many of the oxides of nitrogen are colorless and odorless. However, one common pollutant, nitrogen dioxide (NOi) along with particles in the air can often be seen as a reddish-brown layer over many urban areas.
Oxides of nitrogen form when fuel is burned at high temperatures, as in a combustion process. Figure C-I shows the primary man-made sources of NOx as reported by the United States Environmental Protection Agency (EPA) in 2003.
November, 2007 C-I Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
Manmade Sources of NOx Emissions - 2003
All Other Sources Utilities 1% 22%
Motor Vehicles 55% Industrial/ Commercial/ Residential 22%
Figure C-L
In the Los Angcles area (including Orange, San Bernadino and Riverside counties), NOx emissions arc regulated through the South Coast Air Quality Management Distrct's (AQMD) Regional Clean Air Incentive Market (RECLAIM) program. AQMD's 2003 Air Quality Management Plan indicates that for 2006, 950 tons of NOx per day will be emitted in the Los Angeles area. Total mobile sources (vehicles) emit 855 tons per day, stationary sources emit 95 tons per day, and RECLAIM controlled sources emit 34 tons per day. LADWP's in-basin generating stations (Harbor, Haynes, Scattergood and Valley) combined emit slightly over i ton of NO x per day, with this low value resulting from the installation of advanced emission reduction systems on all ofLADWP's in-basin generating stations. Figure C-2 shows this information on a percentage basis.
SCAQMO's Estimated 2006 NOx Emissions
RECLAIM Sources, 3,5%
LADWP, 0,1%
Off-Road
Vehicles, 30.7% On-Road
Vehicles, 593%
Figure C-2
November, 2007 C-2 Los Angeles Departmcnt of Water and Power 2007 Intcgrated Resource Plan
RECLAIM is a market-driven regulatory program started in 1994 that supersedcd the AQMD's existing NOx rules for facilities with NOx emissions exceeding 40 tons per year. Thesc old "command and control" rules limited the emission rates of stationary combustion equipment and have been rcplaced by a facility-wide emissions cap which gradually declincs each year. Facilities received emission allocations, called RECLAIM Trading Credits (RTCs), in which one crcdit grants the right to emit one pound ofNOX. Facilities must givc to the AQMD enough RTCs to cover their actual emissions. RECLAIM is a market-driven program because the RTCs can be bought and sold which allows for the emissions reductions to be made in the most cconomically cost-cffective manner. All ofLADWP's in-basin power plants now have advanced pollution control equipment which reducc NOX emissions by at least 90%. Howcver, the allocation of RECLAIM trading credits to each of our power plants declincs over time, and the cntire future stream of crcdits was recently cut about 10% by the AQMD. Using the resource planning studies and other considcrations, the environmental assessmcnt results show that thc projections meet LADWP's NOx goals. Figure 8 shows LADWP's historical and estimated NOx cmission levels.
CO2 and Global Warming
Climate change refers to long-term changes in temperature, precipitation, wind patterns, and
other elements of the earth's climatc system. The Intergovernmental Panel on Climate Change (IPCC) defines climatc change as "any change in climate over time, whether due to natural variability or as a result of human activity." An ever-increasing body ofscientific research attributes these climatological changes to greenhouse gascs (GHGs), particularly those generated from the human production and use of fossil fuels (transportation, clectricity generation, agriculture, deforestation, landfills, industrial activities, and mining).
Anthropogenic (human derived, rather than naturally occurrng) greenhouse gases include carbon dioxide (C02), methanc (CH4), nitrous oxide (N20), and various high global warming potential (GWP) gases, including hydrofluorocarbons (HFCs), perfluorcocarbons (PFCs) and sulfur hexafluoride (SF6).
Figure C-3 shows the breakdown ofGHGs in California in 2004, according to the
2006 California Energy Commission's report "Inventory of California Greenhouse Gas Emissions and Sinks: 1990 to 2004". Note that CARE took over responsibility for the Statewide Grecnhouse Gas Emissions Inventory from thc CEC on January I, 2007, and is expected to release a revised version in the surllll1er ûf 2007 for public review_ Formal adoption is expected by January 1, 2008.
November, 2007 C-3 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
Composition of Greenhouse Gases (California, 2004)
High GWP Gases Methane 2.9% 5.7% Nitrous Oxide 6.9%
Carbon Dioxide 84.5%
Figure C-3
The primary sources of California's GIlGs, by end use sectors, are shown graphically in Figure C-4. The amount of GHGs produced in California in 2004 was about 492 million metric tons. LADWP's California generating stations (Harbor, Haynes, Scattergood and Valley) combined produced about 3.3 million metric tons of carbon dioxide in 2004. LADWP's 2004 carbon dioxide emissions from all generation resources (owned and purchased generation including imported power) totaled about 16.6 million metric tons.
Sources of Greenhouse Gases (California, 2004)
.Ariculture and Forestry 8.3% Transporttion .~ Other 40.7% 8.3% i
Electric Power 22.2%
Industrial 20.5%
Figure C-4
November, 2007 C-4 Los Angeles Department oI Water and Power 2007 Integrated Resource Plan
California Governor's Executive Order S-3-05
On the state level, Governor Schwarznegger signed Executive Order S-3-05 on June 1,2005 which sets the fol1owing statewide targets for the reduction of greenhouse gases:
. by 2010, reduce emissions to 2000 levels;
. by 2020, reduce emissions to 1990 levels;
. by 2050, reduce emissions to 80% below 1990 levels.
Recent Legislation and Policy Making
Recommendation 3 provides a summary of recent legislation and policy making processes. Additional information regarding these subjects is provided in the following sections.
California SB 1368: Greenhouse Gas Emission Performance Standard
SB 1368 was signed into law on September 29,2006 and requires tbe CPUC and the CEC to establish a greenhouse gases emission performance standard and implement regulations for al1
long-term financial commitments in base load generation made by load serving entities (LSEs) and local publicly-owned electric utilities (POUs), respectively. The CPUC adopted its regulations for the investor-owned utilities and other LSEs in January, 2007. The CEC intends to adopt regulations by August 2007 requiring POUs to transition away from carbon-intensive generation. These strategies implemented by the CPUC and CEC under SBI368 are expected to result in a combined GHG emissions reduction of over 15 MMT C02E by 2020. The greenhouse gas emission performance standard is not to exceed the rate of greenhouse gases emitted per megawatt-hour associated with combined-cycle, gas turbine baseload generation. The CEC's proposed regulations establish an emission performance standard of 1,100 pounds (0.5 metric tons) of carbon dioxide per megawatt hour of electricity. This standard was established in consultation with thc CPUC and CARB and is the same one adopted by the CPUc.
The broad objectives of these regulations are to internalize the significant and under-recognized cost of emissions and to reduce potential financial risk to California consumers for future pollution-control costs. SpeciIically, these regulations are intended to prohibit any local publicly owned electric utility from entering into a long-term financial commitment unless any baseload generation complies with the greenhouse gases emission performance standard.
These regulations would require POUs, within 10 days of making a long-term financial commitment in a baseload facility, to certify to the Commission that such a commitment complies with these regulations and provide back-up material to support such attestation. The regulations then provide for Commission review of these compliance filings and a determination of whether or not the attestation, and the underlying facility as described in the attestation, complies with these regulations. Additionally, the Commission may open an investigatory
November, 2007 C-5 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
proceeding and gather additional information if it helieves that covered procurements made by a POU do not comply with these regulations.
California AB 32: Glohal Warming Solutions Act of 2006
Assembly Bill 32 was signed into law on September 27, 2006 and requires the California Air Resources Board (CARE) to develop regulations and market mechanisms that will ultimatcly reduce California's greenhouse gas emissions to 1990 levcls by 2020, or an estimated 174 MMTC02E. Mandatory greenhouse gas emission caps will begin in 2012 for significant sources and ratchet down to meet the 2020 goals. In the interim, CARB will begin to measure the greenhouse gas emissions of the sectors it determines as significant sources of greenhouse gas emissions. The bill also provides the Governor the ability to invoke a safety valve and suspend the emissions caps for up to one year in the case of an emergency or significant economic harm.
AB 32 specifically requires CARB to:
I) Establish a statewide GHG emissions cap for 2020, based on 1990 emissions by Januar 1,2008. 2) Adopt mandatory reporting rules for significant sources of greenhouse gases by January 1,2008. 3) Adopt a plan (i.e. Scoping Plan) by January 1,2009 indicating how emission reductions will be achieved from significant GHG sources via regulations, market mechanisms and other actions. 4) Adopt regulations by January 1,2011 to achieve the maximum technologically feasible and cost-effective reductions in GHGs, including provisions for using both market mechanisms and alternative compliance mechanisms. 5) Convene an Environmental Justice Advisory Committee and an Economic and Technology Advancement Advisory Committee to advise ARB. 6) Ensure public notice and opportnity for comment for all ARE actions. 7) Prior to imposing any mandates or authorizing market mechanisms, requires ARE to evaluate several factors, including but not limited to: impacts on California's economy, the environment, and public health; equity between regulated entities; clectricity
reliability, conformance with other environmental laws, and to ensure that the rules do not disproportionately impact low-income communities. 8) Adopt a list of discrete, early action measures by July 1,2007 that can be implemented before January i, 20 i 0 and adopt such measures.
Western Regional Climate Action Initiative (WRCAI)
On February 26, 2007, the Governors of Arizona, California, New Mexico, Oregon, Utah and
Washington signed a Memorandum of Understanding known as the Western Regional Climate Action Initiative Western Regional Climate Action Initiative to combat climate change caused by
global warming. These states have since been joined by the State of Utah, and the Canadian
November, 2007 C-6 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
provinces of Manitoba and British Columbia. Under the WRCAI, the member states and provinces agree to collaborate in identifying, evaluating and implementing ways to reduce GHG emissions collectively and to achieve related co-benefits. This collaboration shall include, but is - , not limited to:
I) Setting an overall regional goal, within six months of the effective date of this initiative, to reduce emissions from our states collectively, consistent with state-by-state goals; 2) Developing, within eighteen months of the effective date of this agreement, a dcsign for a regional market-based multi-sector mechanism, such as a load-based cap and trade program, to achieve the regional GHG reduction goal; and 3) Participating in a multi-state GHG registry to enable tracking, management, and crediting for entities that reduce GHG emissions, consistent with state GHG reporting mechanisms and requirements.
In addition, member states and provinces commit to continue independent and collaborative efforts to reduce GHG emissions through:
I) Promoting the developmcnt and use of clean and renewable energy within the region; 2) Increasing the effciency of energy use within cach jurisdiction; 3) Advocating regional and national climate policies that reflect the needs and interests of western states, tribes and provinces; and 4) Identifying measures in each jurisdiction to adapt to the impacts of climate change.
Federal Greenhouse Gas Policy
There is growing interest at the federal level to regulate the emissions of greenhouse gases trom major sectors and sources. In the U.S. Congress, several legislative bills have been introduccd and/or are being developed to address the U.S. contribution to global warming. If GHG regulation docs occur, it will likely take the form of a national cap-and-tradc program. Each facility would be granted an initial annual allocation, with the allocations decreasing each year. Thosc facilities that improve their process efficiency or invcst in CO2 reduction technology will have credits to sell, and those that do not will become buyers of credits. As fcdcral GHG regulations are adopted, the IRP will be updated to reflect any necessary changes.
The City of Los Angeles GREEN LA Plan
On May 15,2007, Los Angeles Mayor Antonio Villaraigosa released the "GREEN LA - An Action Plan to Lead the Nation in Fighting Global Warming" (GREEN LA Plan) that has an
overall goal ofreducing the City of Los Angeles' greenhouse gas emissions by 35% below 1990 levcls by 2030. This goal exceeds the targets set by both California and the Kyoto Protocol, and
is the greatest reduction target of any large United States City. The cornerstone of the GREEN
LA Plan is increasing the City's use of renewable cncrgy to 35% by 2020. Key strategies listed in the GREEN LA Plan rclated to energy and water include the following:
November, 2007 C-7 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Energy Green the Power from the Largest Municipal Utility in the United States "" Meet the goal to increase renewable energy from solar, wind, biomass, and geothermal sources to 20% by 20 i 0;
"" Increase use of renewable encrgy to 35% by 2020; "" Let contracts for power imports from coal-fired power plants expire; "" Increase the effcicncy of natural gas-fired power plants; and "" Increase biogas co-firing ofnahial gas-fired power plants.
Make Los Angeles a Worldwide Leader In Green Buildings "" By July 2007, present a comprehensive set of green building policies to guide and support private sector development.
Transform Los Angeles Into the Model of an Energy Efficient City "" Reduce energy use by all city departments to the maximum extent feasible; "" Complete energy effciency retrofits of all city-owned buildings to meet a 20% or more reduction in energy consumption; "" Install the equivalent of 50 "cool roofs" per year by 2010 on new or remodeled city buildings; "" Install solar heating for all city-owned swimming pools; "" Improve energy efficiency at drinking water treatment and distribution facilities; and
"" Maximize energy effciency of wastewater treatment equipment.
Help Angelenos Be "Energy Misers" "" Distribute two compact fluorescent light (CFL) bulbs to each ofthe 1 A million households in the city; "" Increase the levcl and types of customer rebates for energy effcient appliances, windows, lighting, and heating and cooling systems; "" Increase the distribution of energy efficient refrigerators to qualified customers; and "" Create a fund to "acquire" energy savings as a resource from LADWP customers.
Water Decrease Per Capita Water Use ~ Meet all additional demand for water resuIting from growth through water conservation and recycling; "" Reduce per capita water consumption by 20%; and "" Implement the city's innovative water and wastewater integrated resources plan that will increase conservation, and maximize use of recycled water, induding capture and reuse of stormwater.
November, 2007 C-8 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
LAD WP's Historical Accomplishments in Reducing GHG Emissions
In 1995, LADWP signed a Climate Challenge Participation Accord with the U.S. Department of Energy (DOE) in which LADWP voluntarily agreed to reduce its C02 emissions such that the average annual C02 emissions over the period from 199 I through 2000 would be less than its 1990 baseline of 18.1 million tons. LADWP met this commitment
In 2002, the LADWP became a Charter Member of the California Climate Action Registry. The LADWP currently has six certified annual greenhouse gas emissions inventories (2000-2005) posted in the Registry's online database. LADWP was the first electric utility to report and certify GHG emissions using the Registry's Power Utility Reporting Protocol.
LADWP has changed its generation resource mix and undertaken numerous programs to reduce GHG emissions since 1990. LADWP has reported changes in its generation emissions as well as
its emission reduction projects annually to the EIA-1605b "Voluntary Reporting of Greenhouse Gases" program. Table C-L shows some of LADWP's emission reduction programs and associated reductions achieved:
Table C-L : Emission Reduction Achievements
Cumulative CO2 Years in Program Description Emissions Effect Avoided or Sequestered (short tons) Water Conservation 4,218,537 Encourage customers to conserve water with Hardware: rebates for installing hardware such as ultra- 1,832,116 Water Conservation low-fiush toilets and low-fiow shower heads, a Behavior: 1991-2005 Program rate structure that rewards conservation. and 2.365.003 public education, 4,197,119 High efficiency clothes Rebates for purchase of energy efficient 1999-2005 21,418 washers residential & commercial clothes washers. Energy End Use 969,027 Provide free CFLs, clean refrigerator Neighborhood Bill condenser coils, distribute low-fiow shower 1999-2001 125,809 Reduction Service heads & aerators, and check for toilet leaks for residential low income customers.
Commercial Free audits and tune-ups of refrigeration ~ Ri:g 1999-2001 v ,v.... Refrigeration Tune-up eouipment for small commercial customers, Sale of high efficiency refrigerators at discount Refrigerator prices to multi-family residential units and non- 1999-2005 4,887 Replacement profit organizations that are DWP customers, and removal & recyclinçi of old refriçierators, Incentives for small commercial customers to 1999-2005 Commercial Lighting install lighting equipment that exceeds Title 24 504,107 standards, 1999-2005 HV AC Replacement Incentives for small commercial customers to 87,872
November, 2007 C-9 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Cumulative CO, Years in Emissions Program Description Effect Avoided or Sequestered (short tons) install HVAC equipment that exceeds Title 24 standards. Expanded to include residential - HVAC units from 2000-2002, ._. Low cost tune-ups of AlC equipment for 2000-2002 HVAC Tune-up 17,510 commercial and residential customers, Incentives for businesses and hospitals to 2000-2005 Chiller Replacement install new high-efficiency water or air-cooled 162,171 chillers that exceed Title 24 standards. Rebates to residential customers for purchase 2002-2005 Consumer Rebate & installation of Energy Star appliances, 46,482 li~htin~, windows, ancjHVAC. Free pick-up and recycling of old spare 2004-2005 Refrigerator Retirement 8,361 refrigerators for residential customers. Free compact florescent light bulbs to 2004-2005 CFL Distribution 5,477 residential customers, Use of Energy Star office equipment Energy Star Office 2000-2005 2,494 Equipment (computers & monitors, printers, copiers and FAX machines), DiQester and Landfill Qas-to-enerQY 854,849 Burn Hyperion wastewater treatment plant 1995-2005 Scattergood digester gas at Scattergood Generating 844,853 Station to generate electricity, Burn Lopez Canyon landfill gas in micro 2002-2005 Lopez Canyon 9,996 turbines to generate electricity, RecyclinQ 159,034 Recycling of paper, cardboard, metals and 1998-2005 Recycling Program 159,034 other materials from LADWP facilities, Building Energy Efficiency Retrofits 60,538 Eliminated 50% of the light fixtures, replaced John Ferraro Building the remaining fixtures with energy efficient 1999-2005 55,568 Lighting Retrofit equipment, and installed automatic lighting controls in LADWP's corporate office building. Incentives to install Energy Star roofing 2001-2002 Cool Roofs product on commercial or multi-family 2,473 residential buildings (state funded), Incentives to install reflective film on windows 2001-2004 Reflective Window Film to reduce building solar heat gain and reduce 1,947 AlC load. Retrofit 37 City of LA facilities with energy 2004-2005 City Building Retrofit 550 efficient lighting. Electricity Generation & Distribution System 36,023 LADWP has 2 solar generation programs: . Customer systems (net metered) 26,757 1999-2005 Solar Power . LADWP and City facilities (grid connected) 1592 Energy Star transformers were Energy Efficient purchased in 1995 & installed in LADWP's 9,266 1996-2005 Transformers distribution svstem
November, 2007 C- i a Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Cumulative CO2 Years in Emissions Program Description Effect Avoided or Sequestered (short tons) Tree Plantina (Urban Forestrv) 19,462 Planted 8435 trees (cumulative) at LA Unified 1998-2005 CDDI SchDDls 6,206 ----_. SchDDI District campuses, Planted 38,618 trees (cumulative) around 2001-2005 Trees fDr a Green LA 13,256 custDmer hDmes and in community areas, Total CO2 Emissions Avoided I Seauestered 6,317,469
Other actions and changes in LADWP generation resource mix trom 1990 to 2005:
. Combined cyele power plants have been installed at the Harbor, Valley and Haynes Generating Stations. These plants are about 30% to 40% more fuel effcient than the ones they replaced and also use advanced technology to reduce NOx emissions.
. Efficiency upgrades at Intermountain Generating Station (IGS) have improved fuel efficiency and increased electrical output, leading to reductions in the plant's CO, intensity measured as "pounds of CO, emitted per unit of energy produced." . Divestiture of 50% of LADWP's share of coal burning Mohave Generating Station.
. The cessation of Mohave Generating Station's operations on December 31,2005. . The LADWP has ongoing programs that promote energy effciency, such as providing incentives for customers to purchase high-effciency lighting and appliances, encouraging electric transportation and tree planting. These and other demand-side management, distributed generation and renewable energy programs are discussed further in Appendix E andF. . LADWP manages and funds a Public Benefits Program, which contributes to the reduction of
CO, and other G HGs. These programs in elude offering incentives for installing solar photovoltaics, energy efficiency upgrades, electric transportation, light emitting diode traffc lights, fuel cel!s projects, and urban forestry programs. . LADWP implemented a "Cool Schools Program", designed to improve air quality, lower energy use by providing shade, and to beautify schools. This, together with its Trees for a Green LA program, have planted over 47,000 trees in the Los Angeles area, leading to the sequestration of approximately 6,800 tons of equivalent CO, annually.
. The Solar Incentive program provides incentives for residential and commercial customers to purchase and install solar electric photovoltaic (PV) arrays, which produce electricity with zero greenhouse gas emissions. PV systems have also been installed on LADWP and Los Angeles City facilities.
November, 2007 C-ll Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
. Installation of mieroturbines at landfill facilities, and purchasing electric power from other landfill facilities, which use methane gas extracted from the landfills to generate electricity. It is estimated that these projects will reduce CO2 emissions by approximatcly 20,000 tons per year.
. Similar in concept to landfill gas-to-energy, metbane gas is produced as a byproduct of the wastewater treatment process. Such reclaimed methane is extracted from the City's Hypcrion Treatment Plant, and then piped to LADWP's neighboring Scattergood Generating Station where it is converted into clectrical power. It is estimated that this project will reduce CO2 emissions by approximately 99,000 tons per year. . LADWP uses alternative-fucl vehicles, including compressed natural gas (CNG), liquefied natural gas (LNG), propane (LPG) and electric powered vehicles in its fleet.
. LADWP's Green Power for a Green LA program provides 60,000 MWhs of renewable (low or non-C02 producing) energy per year to its program participants. . Purchasing and installing energy effcient, lower-loss transformers in its transmission and distribution system. . LADWP operates a comprehensive recycling program for its facilities and has achieved a waste diversion rate of over 80%, exceeding the state-mandated goal of 50%.
. Operation of rideshare and electric vehicle programs.
Power Plant Once-Through Cooling Water Systems
Once-through cooling is the process where water is drawn from a source, pumped through equipment to provide cooling, and then discharged. Some type of cooling process is necessary for nearly every type of traditional electrical generating station, and the once-through cooling process is utilized by many electrical generating stations located next to large bodies of water.
Regulatory agencies have madc several changes in recent years that could significantly impact operations at LADWP's Haynes, Scattergood, and Harbor Generating Stations. The EPA has adopted new regulations that would affect the cooling water intake systems which draw water into these plants for cooling purposes.
Additionally, for the Haynes and Harbor Generating Stations, the Regional Water Quality Control Board reclassified the body of \vater to \vhich the once-through cooling ,vater discharges. For Haynes, this reclassification includes requirements that cannot currently be met with its existing cooling configuration.
November, 2007 C-12 Los Angeles Department ot Water and Power 2007 Integrated Resource Plan
New EPA 316(b) Requirements fiJr Coo!inz Water Intake
The EPA's Clean Water Act Section 316(b) Phase 11 Cooling Water Intake Structure Rule (Rule), became effective September 7, 2004, and requires existing steam electric generating stations with once-through cooling water systems to achieve a level of performance for the reduction of impingement and entrainment impacts to aquatic organisms. (Impingement is defined as the entrapment of any life stage of fish and shellfish on the outer part of an intake structure or against a screen device during periods of intake water withdraws, and Entrainment is defined as the incorporation of any life stage of fish and shellfish with intake water flow entering and passing through a cooling water intake structure and into a cooling water system).
However, the 2004 Rule was challenged and taken to the Second Circuit Court. This Court issued its decision on January 25, 2007, and determined that the restoration and cost-benefit elements of the original 2004 Rule are unlawful, and that other fundamental components of the 2004 Rule, such as the reduction performance standards, are to be remanded for further evaluation and demonstration by the EP A. After this decision, the EP A gave the States permission to continue with implementation and enforcement of the Clean Water Act 316 (b) requirements using "Best Professional Judgment (BPJ) when reauthorizing facility National Pollutant Discharge Elimination System (NPDES) permits.
During this period, LADWP began a Characterization Study to determine an appropriate impingement mortality (1M) and entrainment (E) reduction method. When this study is complete, the results will be used to determine an appropriate course of action to 1) give guidance to the State in determining BPJ and 2) comply with the Clean Water Act Section 316 (b) requirements.
The process of determining the appropriate reduction mcthod(s) may require investigating the cost and feasibility of alternate IMIE reduction technologies. In order to fully assess the performance capabilities of IM/E reduction technologies, pilot studies will need to be conducted in late 2007/ early 2008. Ultimately, LADWP's selected means for 316 (b) compliance will most likely be decided upon the State's determination of BPJ and/or a State wide Policy andlor until a new Rule is promulgated by EP A. Upon renewal of Scattergood and Haynes National Pollutant Discharge Elimination System (NPDES) permits, scheduled for early to late 2008, the 316 (b) requirement language will be included in the renewed permits and will most likely be based on the State's determination ofBPJ.
Thermal Wastewater Power Plant Dischari!es
In addition to the proposed changes to 316(b) Intake Structure regulations, there arc also proposed regulations regarding power plant discharges. The State and Regional Water Quality Control Board has made recent interpretations regarding the classification of the discharge type for the Haynes and Harbor Generating Stations. These LADWP facilities have been regulated since the inception of wastewater permitting, as ocean discharges; however, during renewal of the Harbor Generating Station National Pollutant Discharge Elimination System (NPDES)
November, 2007 C-13 Los Angeles Deparmcnt ot Watcr and Power 2007 Integrated Resource Plan
Permit in 2003, thc discharge from this facility was reclassitied as being into a Bay. With regard to Haynes Generating Station, LADWP has bccn notificd of the Regional Board's intent to reclassify this facility's discharge as being into an estuary when the NPDES permit is issucd in draft (anticipatcd late 2008). The California Thermal Plan has ditTerent thermal criteria for discharges into estuaries than it docs for dischargcs into thc occan and therefore the need to conduct renewed thermal studies is likely.
The potential reclassification of Hayncs as an cstuarinc discharge, which is being disputed by LADWP, is particularly problematic. Haynes, with its once-through cooling water systcm, would be unable to comply with the Thermal Plan. Absent a variance from the Thermal Plan, Haynes as presently configured, would be unable to opcratc. In ordcr to obtain a variance, LADWP may need to perform thermal studies to demonstrate that the thermal criteria are morc stringent than ncccssary to protcct the environment and receive concurrence trom the Regional Water Quality Control Board. An alternative to seeking a thcrmal variancc would be to discontinue the use of once-through cooling via the use of cooling towers which, aside from thc significant cost considcrations and spatial constraints, could very well be un-permittable due to the signiticant environmental impacts they would create, including impacts to thc aquatic cnvironmcnt (the Long Beach Marina tram which the Haynes Generating Station draws its cooling water could go stagnant and thc San Gabriel River Flood Control Channel into which the facility discharges cooling water could be markedly altered).
Mercury Emissions
Mercury emissions are an issue for all coal fired powcr plants. Howcvcr, thc Icvel of such cmissions varies widely based on the type of coal burned and the type of emission controls on the plants.
Coal-burning power plants are the largest human-caused source of mercury cmissions to thc air in the United States, accounting for over 40 percent of all domestic human-caused mcrcury emissions. Thc EP A cstimatcs that about V. of U.S. emissions from coal-burning power plants arc dcposited within the contiguous U.S. and the remainder enters the global cyele. Mercury in thc air cvcntually settles into water or onto the land where it can be washed into water. Once deposited, it builds up in fish, shellfish and animals that cat fish. Mcrcurj exposure
at high Icvels can harm tbe brain, heart, kidneys, lungs, and immune system of people of all ages. Research shows that most people's fish consumption docs not causc a health concern. However,
it has been demonstrated that high levels of methylmercury in the bloodstream of unborn babics and young children may harm thc dcveloping ncrvous systcm, making the child less able to think and learn.
Intcrmountain Generating Station (IGS) in Utah, of which LADWP is the Operating Agent, has
one of the lowest mercury emission rates in the country. This is duc to the fact that the existing cmission control devices, which are designed to reduce sulfur dioxide and particulate matter,
have the co-benefit of removing about 96% ofthc mcrcury from bituminous coal which is burned at IGS.
Novcmbcr,2007 C-14 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
The EPA promulgated the Clean Air Mercury Rule (CAMR) on March 15,2004 which established a nationwide eap-and-trade program for mercury emissions. CAMR is designed to reduce mercury emissions by 60% between 2010 and 2018. The allocation of mercury credits to individual power plants will be made at the state level and thc state's have considerable latitude in determining how those allocations will be calculated. The CAMR is undergoing several legal challenges and its future is uncertain.
Wind Energy
The development of wind resources represents a major component of LADWP's efforts to increase our use of renewable energy. In order to obtain approval for many of these projects, LADWP is working closely with numerous state and federal agencies, including the Bureau of Land Management, US Fish and Wildlife and Service, California Department ofFish and Game and the State Historic Preservation Offce. In addition to regulatory approvals, other challenges associated with developing these wind resources include potential conflicts with military airspace, land use compatibility issues, visual and noise impacts and avian concerns.
During the siting and design of the 120 MW Pine Tree Wind Development Project, LADWP was involved in lengthy negotiations with the Departent of Defense regarding air space constraints and is currently involved in litigation with the Audubon Society regarding perceived avian impact issues. The ability to favorably resolve these issues in a timely manner will be critical in meeting our 20% renewable energy goal. Additional information regarding wind rclated issues can be found in Appendix D.
Transmission
LADWP is in the process of finalizing the Plan of Service to construct a 500kV transmission line between the Imperial Irrgation District (110) and LADWP. It is estimated that there is a large quantity of renewable energy resources located within the 110 control area, and the transmission
line will establish a connection between the two control areas. This project is part of the "Green Path" Projects being initiated by LADWP, lID and Citizens Energy, and the planned in-service date is 20 I O. Additional information regarding the transmission system and proposed projects can be found in Appendices 0 and H.
Municipal Solid Waste Energy Conversion
The City of Los Angcles recognizes the importance of diverting municipal solid waste from landfills and developing alternatives to landfills such as those utilized around the world. To achieve this goal, the City of Los Angeles, Bureau of Sanitation contracted with URS Corporation to conduct an in-depth evaluation of a wide range of alternative technologies,
November, 2007 C-15 , Los Angeles Department at Water and Power 2007 Integrated Resource Plan
including advanced thermal rccyeling, thermal conversions, and biological and chemical conversions, for processing residual solid waste from residential curbside collection.
The Renewable Portfolio Standard defines the following resource to be "eligible" as a renewable resource "... municipal solid waste only if the energy conversion process docs not employ direct combustion of solid fuel...". It is yet to be decided which type of technology will be used for the City's future solid waste program, and if such a process would be considered as a renewable resource, or perhaps as Distributed Generation. Future steps in the development process are currently being prepared, and LADWP will support the City in its evaluation.
November, 2007 C-16 Los Angeles Dcpartment of Water and Power 2007 Integrated Resourcc Plan
Appendix D. Renewable Portfolio Standard
Overview of LADWP's Renewable Portfolio Standard (RPS) Poliey
LADWP has historically stated that its major objectives concerning integrated resource planning are 1) providing reliable service to our customcrs, 2) rcmaining committed to environmental lcadcrship and 3) maintaining a competitive price. An example ofLADWP's commitment to environmental Icadcrship was shown in May of 2004, when LADWP approved its RPS framework. This policy set a goal of incrcasing its supply of electricity from "eligible" rcncwable resources until a target portfolio level of 20 percent is reachcd by Dccember 31, 20 i 7, measured by thc amount of electric energy sales to retail customers.
This 2007 IRP will also formalize LADWP's new commitmcnt ofaccclcrating its existing RPS policy to mccting the 20% goal by 2010, and also meeting a goal of35% by 2020. Additionally, LADWP will continue to encouragc voluntary contributions from customers to fund renewable resources above tbe stated RPS goal, as part of its Grccn Powcr for Grccn LA program.
The following are key milestoncs rclatcd to renewable energy implementation: . In May 1999, LADWP implemented the Green Power for Green LA program to incrcase rcncwablc energy resource development and procurement through voluntary contributions by its customers. This program included the procurement of renewable resources to supply approximately 30,000 Green LA program customcrs as wcll as planting approximately 15,000 trees annually. . In August 2000, LADWP adopted an IRP that providcd a blucprint for LADWP's long-term resource needs. Some of the major recommendations of thc 2000 IRP included the
rcpowcring of 10 Los Angeles Basin generating units, installation of NO x emission controls, installation of six peakcr units, and thc implementation of several renewable resource related
programs and projects. Some of these initial "RPS" projccts cstablishcd a goal of meeting 50% ofprojcctcd load growth using Demand-Side-Management (DSM) and Distributcd Generation, and Renewable Resourccs. Undcr this plan, LADWP established a goal of
dcvcloping 30 MW of renew abIes by 2001, 100 MW by 2005, and 150 MW by 2010. . In 200 i, LADWP issued its first Request for Proposals (RFP) for Renewable Resources. The
120 MW Pine Tree Wind Project was one of the projccts rcsulting from this RFP. ~ In 2002, the California Legislature passed the California Senate Bill 1078 that established the California Renewables Portfolio Standard, with a goal for all investor-owned utilities to increase their use ofrcncwablc rcsources by at least 1 percent per year, until 20 percent of their retail sales are procured from renewables by 2017. Although publicly-owned utilities like LADWP arc cxempt from the California Senate Bill 1078, they are encouraged to
establish renewable resource goals consistcnt with thc intent of the Legislature.
. In latc 2003, thc Mayor and the City Council took several steps toward developing a ncw
Renewables Portfolio Standard for LADWP. This included the creation of the Green Ribbon
November, 2007 D-I Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Commission by the Mayor, and convening a Renewable Energy Summit by the Commerce, Energy and Natural Resources Committee.
. On June 29, 2004, the Los Angeles City Council adopted a LADWP Renewables Portfolio Standard Framework that was used as the basis for the establishment of the current Renewables Portfolio Standard Policy. This Renewables Portfolio Standard Framework
requested the Board of Water and Power Commissioners "to adopt a Renewables Portfolio Standard of 20 percent renewable energy by 2017 setting applicable milestones to achieve this goal," and "incorporate this Rcnewables Portfolio Standard into all future energy system planning. It should also be reflected in the Integrated Resource Plan now being prepared, to identify actions to be taken in the next year toward increased renewable energy procurement and/or development." The complete Renewables Portfolio Standard Framework is ineludcd as Reference D-I.
. On June 29, 2005, the City Council approved the City of Los Angeles Department of Water and Power Renewables Portfolio Standard Policy, which has many similarities to the state mandate for the investor owned utilities. The RPS is designed to increase the amount of energy LADWP generates from renewable power sources to 20% of its energy sales to retail customers by 2017, with an interim goal of 13% by 2010. The policy will provide a long- term framework to achieve the 20% goal without compromising power reliability or the
financial stability of the Department and its customers. In July of2005, Los Angeles's newly elected Mayor Antonio Villaraigosa was inaugurated into office. Shortly thereafter, Mayor
Villaraigosa appointed a new Board of Water and Power Commissioners. This new Board
has been very proactive in supporting the acceleration of the existing LADWP RPS goal of 20% rencwables by 2017, to achieving this goal by 2010.
. In December of 2005, the Board of Water and Power Commissioners recommended that LADWP accelerate the RPS goal to obtain 20% renewables by 2010. This recommendation ineluded updating LADWP's Integrated Resource Plan to inelude this goal, proceeding with the negotiation and contract development for renewable resources proposed and selected in LADWP's 2004 RFP and SCPPA's 2005 RFP, and to prepare and submit for consideration a mechanism to support the cost of accelerating the RPS and to maintain the financial integrity of LADWP's Power System during times of natural gas price volatility.
. In December 2005, the LADWP Board of Water and Power Commissioners recommended that LADWP accelerate its RPS goal to obtain 20% renewables by 2010. This was approved by ordinance in April 2007. The complete RPS policy is included as Reference 0-2.
. In January 2007, LADWP issued a third RFP for Renewable Resources. The intent of this RFP was to obtain a sutlcient amount ofrenewable energy per year to achieve the RPS goal ûf20% by 2010. . In May 2007, Los Angeles Mayor Antonio R. Villaraigosa set several new goals for the City of Los Angeles and for the LADWP. These goals include increasing the use of renewable
energy to 35% by 2020, reducing the City of Los Angeles' greenhouse gas emissions to 35% below 1990 levels by 2030, and not to renew contracts for power imports from coal-fired plants.
November, 2007 D-2 Los Angeles Department otWater and Power 2007 Integrated Resource Plan
Reference D-l - 2004 Renewables Portfolio Standard Framework:
RENEWABLE PORTFOLIO STANDARD
Resolution ~ WHEREAS, it is the number one priority of the Los Angeles Department of Water and Power (DWP) to provide reliable and affordable energy to its customers which many rely on; stability and afford ability are vital to the economy and job development of the city; and
WHEREAS, providing affordable energy is even more critical to low income families: and
WHEREAS, the City has historically supported the preservation of local control and strong opposition to any form of state or federal jurisdictional encroachment efforts, this longstanding philosophy served to protect the City and its ratepayers during the State's energy crisis when California IOU's were forced to rely on spot market energy purchases to meet electricity demand following divestiture of substantial portions of their generation capacity as required by the State's deregulation legislation (i,e, AB 1890); and
WHEREAS, DWP launched the Green Power for a Green LA Program in May 1999, the goals of the Program were to reduce the use of fossil fuels for electricity generation by replacing them with new renewable sources such as solar, wind, geothermal and bio mass.
WHEREAS, most renewable energy production markedly reduces the emission of air pollutants ultimately improving air quality while also lowering the City's contribution to global greenhouse gases: and
WHEREAS, given the continuing public health and environmental problems associated with air pollution as well as the possibility of future energy shortages and prices spikes, it is in the environmental and economic interest of the City to increase the amount of energy that LADWP generates from renewable sources; and
WHEREAS, public benefit programs, such as demand~side management programs, are integral to the City meeting its energy demands and to the Department of Water and Power (DWP) achieving its strategic objectives; and
THEREFORE, BE IT RESOLVED, that with concurrence of the Mayor, by adoption of this resolution, the City Council request the Board of Water and Power Commissioners, by the end of 2004, adopt a Renewable Portfolio Standard of 20% renewable energy by 2017 setting applicable milestones to achieve this goal.
BE IT FURTHER RESOLVED that the Los Angeles Department of Water and Power (LA DWP) incorporate this Renewable Portfolio Standard into all future energy system planning. It should also be reflected in the Integrated Resource Plan now being prepared, to identify actions to be taken in the next year toward increased renewable energy procurement and/or development, and to instruct the DWP to include in its report on RPS the impact on the local economy and jobs (as amended).
November, 2007 D~3 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Reference D-2 - 2007 Rcnewables Portfolio Standard Policy:
City of Los Angeles Department of Water and Power Renewables Portfolio Standard Policy As Amended April 2007
1. Purpose:
In 2002 California Senate Bill 1 078 (SB1 078), an act to add Sections 387, 390.1 and 399.25, and to add Article 16 (commencing with Section 399,11) to Chapter 2.3 of Part i of Division 1 of the Public Utilities Code, was passed establishing a 20 percent Renewables Portfolio Standard (RPS) for California investor- owned utilities. SB 1078 provides that each government body of a local publicly owned electric utility shall be responsible for implementing and enforcin9 a RPS that recognizes the intent of the Legislature to encourage renewable resources, while taking into consideration the effect of the standard on rates, reliability, and financial resources and the goal of environmental improvement.
On June 29, 2004, the Los Angeles City Council passed Resolution 03-2064-S1 requesting that the Board of Water and Power Commissioners adopt an RPS Policy of 20 percent renewable energy by 2017 setting applicable milestones to achieve this goal, and incorporate this RPS into a future Integrated Resource Plan(IRP).
On May 23, 2005, the Los Angeles Department of Water and Power (LADWP) Board of Commissioners (Board) adopted a LADWP RPS Policy that established the goal of increasing the amount of energy LADWP generates from renewable power sources to 20% of its energy sales to retail customers by 2017, with an interim goal of 13% by 2010, On June 29, 2005, the Los Angeles City Council approved the LADWP RPS Policy.
In order to further promote stable electricity prices, protect public health, improve environmental quality, provide sustainable economic development, create new employment opportunities, and reduce reliance on imported fuels, in December 2005 the Board accelerated the LADWP RPS goal to a mandated 20% renewable energy by 2010.
This RPS Policy, as amended April 2007, represents the LADWP continued commitment to renewable resource supply as requested by the City Council Resolution 03-2064-S1 and is consistent with the provisions of SB 1078 (2002),
2. Goal: To promote stable electricity prices, protect public health, improve environmental quality, provide sustainable economic development, create new employment opportunities, and reduce reliance on imported fuels, LADVVP will increase its supply of electricity from "eligible" renewable resources until a target portfolio level of 20 percent is reached by December 31,2010, measured by the amount of electric energy sales to retail customers.
Also, LADWP will continue to encourage voluntary contributions from customers to fund renewable resources above the stated RPS goal.
3. Eliqible Resources: Electricity produced from the following technologies constitute "eligible" resources: biomass; biodiesel; digester gas; fuel cells using renewable fuels: geothermal; landfill gas: municipal solid waste only if the energy conversion process does not employ direct combustion of solid fuel; ocean wave, ocean thermal, and tidal current technologies; solar photovoltaic: small hydro 30 MW or less, and the Los Angeles Aqueduct hydro power plants; solar thermal: wind; and other renewables that may be defined later,
November, 2007 0-4 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
4. Lonq-Term Resource Plan: LADWP will integrate the RPS into its long-term resource planning process, and the RPS will not compromise LADWP's IRP objectives of service reliability, competitive electric rates, and environmental leadership.
5. Renewable Resource Acquisition: LADWP's renewable acquisitions will be based on a competitive bid process, and least-cost, best-fit project selection criteria will be utilized, Furthermore, preference will be given to projects that are located within the City of Los Angeles and are to be owned and operated by LADWP to further support LADWP's economic development and system reliability objectives.
For acquisitions before December 31,2010, LADWP will pursue its twenty percent (20%) RPS goal in a manner which will result in a minimum of forty percent (40%) renewable energy generation ownership that LADWP develops or that LADWP acquires through contracts with providers of renewable energy. Further, with respect to the foregoing contracts with providers such contracts will provide for LADWP ownership or an option to own, either directly or indirectly (including through joint power authorities),
On or after January 1, 2011, a minimum of seventy five percent (75%) of all new renewable energy generation acquired by LADWP will either be owned or acquired by LADWP through an option-to-own, either directly or indirectly (including through joint powers authorities) until at least half of the total amount of the renewable resources are supplied by renewable resources owned or optioned either directly or indirectly (including through joint power authorities) by LADWP,
First priority for LADWP will be to pursue outright ownership opportunities: second priority will be consideration of option-to-own cost-based renewable resource acquisitions, In comparing outright ownership to "option-to-own", option-to-own projects must show clear economic benefits, such as pass- through of Federal or State tax credits or incentives, which could not otherwise be obtained, or the need to evaluate new technology, The option-to-own will be exercisable with the minimum terms necessary to obtain and pass those tax credits and/or incentives to LADWP and/or upon a reasonable amount of time to evaluate the operation of the new technology.
6. Svstem Rate Impact: The Board established a "Renewable Resources Surcharge", to cover the additional costs of renewable resources to meet the RPS goals beginning on July 1, 2006. LADWP may not make any major financial commitment to procure/acquire renewable resources prior to evaluating the rate impact and any potential adverse financial impact on the City transfer.
7, Solar Set Aside: Following further assessment by LADWP, and adopted legislation, the Board of Water and Power Commissioners may establish a solar set aside, The Board of Water and Power Commissioners may also establish the appropriate prices to be paid for solar resources and a "Solar Surcharge" to cover the additional cost of a solar set aside.
8, Reportinq Requirement: LADWP will provide an annual report of the following information to its customers and the California Eneígy Commission (CEe) as required by S8 1078 and SB 107: (1) expenditure of PBC funds for renewable energy resources development, (2) the resource mix used to serve its retail customers by fuel type, and (3) status in implementing a RPS and progress toward attaining the standard, LADWP will continue to provide a quarterly Power Content Label Report to its customers as required by SB 1305 (1997), and an annual report of the total expenditure for renewable resources funded by voluntary customer contributions,
9, Flexible Compliance: Renewable resource procurements will be limited to development and acquisition of physical generation assets and energy purchase contracts, and therefore, LADWP will not purchase the "renewable energy
November, 2007 D-S Los Angeles Department of Water and Power 2007 Integrated Resource Plan credit" from a renewable reSDurce, withDut purchasing the assDciated energy. In the event that RPS gDals cannDt be achieved due tD limitatiDns in the "AbDve Market Subsidies", "Surcharge", Dr the availability Df renewables that meet the IRP requirements, the BDard Df Water and PDwer CDmmissiDners shall cDnsider adjusting this RPS PDlicy as needed.
Renewable Energy Requests for Proposals
To help meet the renewable energy goals for the Green Power for Green LA program and the RPS policy, LADWP has issued three major request for proposals (RFP) for renewable energy projects, with one RFP being issued in 2001, another RFP issued in June 2004 and another RFP issued in January 2007. LADWP performed detailed technical and economic analysis of the proposals on a least-cost, best-fit basis. This approach considered factors such as cost, technical feasibility, project status, transmission issues, and environmental impact
2001 Renewable RFP
In response to the 2001 RFP, a total of21 projects were proposed, with the 120 MW Pine Tree wind project meeting LADWP's renewable, economic, technical and least-cost, best fit criteria. The Pine Tree wind project is located in the Tehachapi area, and LADWP will own and operate this facility. This project is under active development and is projected to be in-service in mid 2009.
2004 LADWP Renewable RFP and the 2005 SCPPA Renewable RFP
In June 2004, LADWP issued another RFP with the intent of securing an increased portion of its power requirements from renewable resources. The goal of LADWP's 2004 RFP was to obtain about 1,300 GWhs ofrenewable energy per year to meet the RPS interim goal of 13% by 2010. A total of 57 distinct proposals were received, covering nearly all types of renewables, although wind and geothermal represented the largest share of proposed energy. Most of the proposals were from new California projects, witb only a few actually located in Los Angeles. The proposals offered a mix of power purchase and ownership options. In 2005, SCPP A also issued a RFP for renewable resources, in which LADWP is participating.
LADWP was assisted in the evaluations ofthe 2004 LADWP RFP proposals by two independent entities to ensure fairness and consistency during the evaluation process. This team evaluated proposals through a structured process consisting of two phases of evaluation. Tbe Phase i evaluation comprised a Completeness & Requirements (C&R) screening, a Technical & Commercial (T&C) evaluation and an economic assessment Those proposals that were short- listed in the Phase i evaluation were evaluated in greater detail in the Phase 2 evaluation. The Phase 2 evaluation compared a calculated Net Levelized Cost for each proposal. The Net Levelized Cost of each proposal is equal to the Levelized Busbar Cost of energy in units of
November, 2007 0-6 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
$/MWh less the Avoided Energy and Capacity Costs, and adding the Levelized Transmission Costs to cover wheeling, losses, transmission upgrades, etc.
So far, two contracts for renewable energy resulting from the 2004 RFP have been entered into, which will provide over 81 GWH of renewable landfill-based energy. Many of the other proposals that were received arc currently being expediently negotiated.
2007 LADWP Renewable RFP
In January 2007, LADWP issued another RFP with the intent of obtaining approximately 2,200 GWhs of renewable energy and dependable capacity per year to meet the RPS goal of 20% by 2010. A total of 59 distinct proposals were received, covering wind, solar thermal, solar photovoltaic, geothermal, and biomass renewable technologies. The proposals otlered a mix of power purchase and ownership options.
Renewable Project Summary
LADWP (and SCPPA) arc currently procceding with the negotiation and contract development for proposed renewable resources resulting from the above described RFPs. The summary of both tbe nameplatc capacity, and the "Dependable Capacity" for these projects and the expected in-service dates are shown in Table D-l. These projects arc also incorporated Section 3.5's
'Table I - Summary of Loads and Resources". However, the RPS goal will be measured by the amount of energy supplied to LADWP's customers and is shown in Figure 9, not the capacity of renewable resources. The "Dependable Capacity" of a project is defined as the amount of generating capability that LADWP can depend on during the peak demand hours of a day. As LADWP only has a limited amount of operating experience with somc of the renewable technologies, information from a variety of published renewable integration studies was used in determining what capacity value is appropriate for each technology. LADWP will remain conservative in applying capacity values for renewable technologies at this point in time, until it gains more actual operating expcrience with thesc technologies and specific projects.
Novembcr,2007 D-7 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Dependable Summa'YofEllglbleRenewablcRPSproJecl. Capaoty Capacity by ye., F"cloC1(DCF) 2007 2008 2009 2010 2011 2012 2013 2014 2015 201fi 2017 2018 2019 2020 2021 2022 2023 2024 202~ 2025 2027 1_~~ OIBesterG~s C , , , , , , , ; , ó " ó ó ó ó ó ; ó Ó 0.9S Geothermal 0 0 0 "' m '"' '"' '"' '"' '"' '"' '"' 281 28r '"' ~R7 '"' '"' '"' ni 287 0.90 LordfrllGas 0 , , , , , , , , , , , , , , , , , ; , ; 0.90 Municipal solidwasle ccnv€'S'on 0 0 0 0 '" " " WO 100 'CO 'CO '"0 10~ '" 1ü~ 100 WO WO 10~ 'CO '" 0.50 Srna'IHydroelecl'iê 0 0 " " n H H H " " " H " H " H H H H H H ü_2~ SolerPhotovcllaic B " " "" 2~ 231 2~8 28" 312 339 ,"0 3r,r, 360 3C6 366 '"0 '00 '"' '00 '"0 '00 0.25 SclarThermal 0 0 0 m m m m m 675 61~ 6f~ 51~ 610 1;15 67:, "75 675 675 675 G75 0.10 Wi,-d 0 , 219 92~ 1175 1175 1175 1175 1175 1175 1175 1175 1175 1175 1175 1175 l1f~ 1110 111~ 11/~ 1";
WllhDCFs DigeslerGas 0 , , , , " ó ó ó ; ; ó ; ó , , , , ó " Geothermal 0 0 0 m "0 no no no no 273 213 213 213 213 273 ~73 773 773 713 m no Lindfi '"' " , " " 0 0 " " 0 0 0 0 0 0 0 " " " , , , M"'"i"Ir.~I,nlldw",I( "miv",,I(,n " 0 " " " " 5B "0 "0 "" "" g~ "" '" "" "" "" "" "" "" '" SllallHydroelecfric , 0 " , , " " " " " " " " " " , " " " " " Sular (PV and The'ma.) " " '" '" 157 '" ?33 "" '" ,~ '00 'oo '" '"" ,eo 25~ 25~ 250 250 Z50 Z50 Wino " " " "' "" "" "" "" "" "" "" "" ''" "" "" m "" "" "0 "0 m
Table D-l: RPS Projects and In-Service Dates
Integrating Intermittent Renewable Resources into LADWP's Power System
LADWP continues to be committed to environmcntalleadership in not only embracing the accelerated RPS goal of 20% renewable energy by 2010, but also exceeds thc State of California's 33% renewables goal by 2020 by increasing LADWP's goal to 35% renewables by 2020. Nevertheless, LADWP also remains committcd to providing reliable electric service to its customers. Recommendation 4 of this 2007 lRP describes what steps LADWP will accomplish to successfully increase the amount ofrcnewable resources while maintaining a reliable power system.
Recommendation 4 also explains that some rcnewable resources generate energy according to nature, and are not controllable or dispatchable by power system opcrators. For example, solar resources generally only producc encrgy when the sun is up, and wind resources generally only produce cnergy when the wind is blowing. Such rencwable resources are often referred to as intermittent renewable generation technologies. Additionally, these intermittent wind and solar technologies are expected to provide 58% ofLADWP's renewable energy in 2010 and 55% in 2020. The following Figures D-l and D-2 compare average wind and solar production to LADWP's typical summer and non-summer customer electric demand. On average, the wind energy production (which occurs primarily anti-coincident with power system demand) and solar energy production (which occurs primarily coincident with power system demand) tends to together provide a consistent source of energy for the power system. However, averagc monthly wind energy production profies are not representative of actual hourly production. This is shown in Figure D-3, which shows the actual wind delivcrics to LADWP from an individual wind farm in June of 2004, compared to the average wind
production for that month. LADWP expects that by diversifying its portfolio of wind farms by geographic location, and having a large amount of wind farms, this high amount of variability in wind energy production will be minimized. Recommendation 4 also rccommends that LADWP's generation portfolio be enhanccd to become more flexible in order to successfully and reliably integrate intermittcnt renewable resources.
November, 2007 D-8 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Figure 0-1: Pine Tree Power Curves Compared to System Load Curves
- Solar PV (Noii- Summer)
Figure 0-2: LADWP Solar Power Curve Compared to System Load Curves
November, 2007 0-9 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
'.Jun
3-Jun 4-Jun -5.Jun 6.Jun " " " 9.Jun 1O.Jun 11.Jun 12.Jun 13-Jun
16.Jun . 17-Jun 18.Jun 19.Jun 20.Jun 21-Jun 22-Jun -23.Jun --24.Jun -25-Jun 26-Jun
Figure 0-3: June 2004 Hourly Wind Deliveries Compared to the Monthly Average
Transmission of Renewable Energy
California, and many of the western states, contain a variety otresources (wind, solar, geothermal, and other "eligible" resources previously defined in the RPS Policy) that can be developed to ultimately generate electricity. However, the current transmission system was not primarily designed with these natural resources in mind. Figure 0-4 shows the general locations of several principle renewable sites.
November, 2007 0-10 Los Angeles Dcpartment of Water and Power 2007 Integrated Resourcc Plan
~ Small Hydro ~Wiiid ~. Biomass
n Solar ~ Geothennal
Figurc D-4: Renewable Rcsource Locations Proposed in the 2004 RFP
However, even with the substantial existing transmission systcm owned by LADWP, and the
other transmissions systcms in California, therc is only a limited amount of transmission lincs to many of thc potential renewable rcsource locations. In ordcr to gain access to thcse sources of rcnewable energy, LADWP is planning on building additional transmission lines and expanding the capabilities of several existing lines. These projccts include:
i) The "Grecn Path North Project" is a part ofa system of transmission projects dcsigned to gain access to rencwable geothermal, solar and wind resources located in the Salton Sca area, northeast of San Diego. The Green Path North Project includes constrcting a 500- k V transniIssIon line from a ne\v Devers II sübstatiûn tû a new Hcspeíia switching station, which will intcrconnect LADWP with thc Imperial Irrgation District (lID).
Figure D-5 shows a diagram of this proposed set ofprojccts.
Novcmber, 2007 D-Il Los Angeles Department of Water and Power 2007 Integrated Resource Plan
- Exstng :5CûkV Une -- New 500kVUne '",0 - Ewsting 230/287kV Une -- Rebuild/New 230.iS7kVUne- o CAiSO r.er Point C(¡nLiry GPNP Corron Fæilites New :500IN Une . Staton
SGin310
GREEN PATH NORTH PROJECT
..-...----- ~-....-..- ...._-- --~-..~ Piio',"n:, ....-..-.~ Il=.';'fl;:
Hgtiln..
_..i_~,A MIIJi.1 ------\ --- ~iil:V.o '-----
Figure 0-5: The "Green Path North Project" Transmission System
2) Transmission access and transmission line upgrades are needed to accommodate proposed wind projects in the Tehachapi area, a geothermal project in the Mammoth area and solar thermal projects in the Mojave Desert which total more than 1,000 MW. The
initial project is the construction of the Barren Ridge substation which supports the 120 MW Pine Tree Wind project. This substation will interconnect with LADWP's existing 230 kV Inyo-Rinaldi transmission line (which was built to gain access to the renewable hydro-generated energy from LADWP's aqueduct system in the Owens Valley). The Inyo- Rinaldi transmission capacity needs to be increased in order to accommodate additional renewable energy projects. 3) Upgrading the "Southern Transmission System", or the STS, which is described in
Appendix G and is part of the Intermountain Transmission System. This upgrade will provide access to renewable wind, geothermal and biomass resources located in Utah, Wyoming and Nevada. This transmission system was originally built to bring in energy generated from the Intermountain Generating Station located in Utah.
November, 2007 0-12 Los Angeles Department of Water and Power 2007 Intcgratcd Resource Plan
Funding the RPS
For LADWP to develop a responsible and prudent renewablc cncrgy policy, it must balance cnvironmcntal objectives such as fuel diversity, energy effciency and clean air against thc Department's core responsibility to provide and distribute safe, reliable and low-cost energy to its customers. That means developing a RPS that cnsurcs LADWP's continued financial integrity and striving to mitigate the financial impact on retail customers.
The financial impact of meeting the 20 percent RPS goal will vary depending on the mix of rcsourcc types and associated costs. Generally, renewable energy costs morc than traditional energy sources such as natural gas and coaL. However, a diversified energy portfolio, including a larger mix of renewables, may also reducc thc risks of price spikes due to fuel supply shortages and price fluctuations.
LADWP will consider mechanisms to rccovcr thc costs incurred to support the Renewable Portfolio Standard requirements. These costs include:
. Interconnection costs; . Transmission costs, including cncrgy losses; . System integration costs, including costs associated with increased regulation and contingency reserve requircmcnts associated with wind energy;
. Renewable energy costs that cxcccd LADWP's cost of providing power from traditional energy sources; and . Renewable power procuremcnt and administrative costs.
Existing LADWP Renewable Projects
As is shown in LADWP's 2007 Power Contcnt Labcl (Figurc D-6), 8 percent of the energy supplicd to LADWP's customers is generated from eligible renewable resources. These renewable resources include thc following:
I) A system of small hydro-electric generating stations located along LADWP's aqueduct system, which brings water to Los Angeles from the Owns Vallcy area in central California. This hydro-elcctric generating system consists of 2 i stations, capable of generating a total of209 MWs, and in 2006 gcnerated 859 GWh of energy. 2) The San Francisquito Power Plant 2 completed refurbishment in early 2007. Power Plant 2 is locatcd on the Los Angeles Aqueduct system and consists of three units. Units I and 2 were built in i 920 and Unit 3 was built in 1932. This project will act to increase the reliability of the power system and ensure the generation of renewable energy from this resource.
November, 2007 0-13 Los Angclcs Department of Water and Power 2007 Integrated Resource Plan
3) LADWP's Scattergood Generating Station is located next to thc City of Los Angeles' Hyperion waste treatment plant At the Hyperion facility, methane gas is produced as a byproduct of thc anacrobic digcstion process and then piped to the Scattergood Generating Station, where it is converted into electrical energy. This proccss is rated at 22 MW, and in 2006, 130 GWhs of energy was generated. 4) LADWP has installed 50 microturbines at Lopez Canyon Landfill that convert the methanc gas that is collcctcd at the landfill into electricity. The capacity of the microturbines sums to 1.5 MW, and in 2006, 1.2 GWhs of energy was gcncratcd. 5) LADWP purchases renewable wind energy from the Pleasant Vallcy Wind Encrgy
facility, located in Uinta County, Wyoming. The agreement is for 82 MW of wind power, and in fiscal ycar 2006-2007, 182 GWh of energy was produced. 6) LADWP purchases rcncwable small hydro cncrgy from Powerex Corporation, located in the Pacific Northwest The agreement is for 50 MW of small hydro powcr, bcginning in April, 2007. 7) LADWP purchases renewable energy using landfill gas technology from the Bradley Landfill and the Penrosc LandfilL. Both of thcsc facilitics arc located in the Los Angeles area. The facilities on these landfills provide almost 13 MW of capacity, and gcncratcd 41 GWHs ofrcncwable energy in 2006. The contracts for these two facilities resulted from the 2004 RFP. 8) LADWP has installed about I MW of Solar Photovoltaics at LADWP facilities and other locations in the Los Angeles area. LADWP has also provided incentives to customers,
which havc rcsultcd in thc installation of about 10 MW on LADWP's customers' properties.
9) LADWP has entered into an Agreement to purchase 185 MW of wind cnergy from thc Milford Wind Corridor Phase I Project, located in Millard County, Utah. This project is expected to generate 460 GWh of encrgy annually, and thc commcrcial operation date is scheduled for early 2009. 10) LADWP has also made purchases ofrenewable energy from different resources to support both its RPS and Grccn Powcr for a Grccn LA program goals.
Future LADWP Renewable Projects LADWP has several additional projects that are in various stages of development, including thc following: 1) In 2006, LADVv'P acquired property totaling approxirnately 5,680 acres in 15 separate parcels in Imperial County, California, ncar thc Salton Sca. Ccrtain parccls have a preliminary assessment of about 85 MWs in geothermal potentiaL. Other parcels have potential for solar, solar thcrmal and/or wind rcnewable energy development value. Most ofthe parcels are adjacent to the proposed Green Path Coordinated Projects transmission system. An initial 50 MW plant is currently in thc evaluation phase of development
November, 2007 0-14 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
2) LADWP is studying the possibility of installing a 3 to 4 MW bypass hydroelectric plant at the Upper Gorge Power Plant (UGPP), which would operate in lieu of an existing Energy Dissipation Structure (EDS). The EDS was constructed in 1995 to make low ., flow water releases to the Owens River when the UGPP is not passing water. The average annual generation from this facility is estimated to be about i I GWhs.
3) LADWP is planning on constructing a 3 to 4 MW hydroelectric plant as part of the Water System's Silverlake Replacement Project at the Headworks spreading grounds. The hydroelectric plant will be used to reduce the water pressure at Headworks, in lieu of using pressure reducing valves. The average annual generation from this facility is estimated to be about 22 GWhs.
LADWP is also negotiating many additional renewable energy projects that have been offered in response to LADWP's Request for Proposals.
Public Benefis Program
In 1996, Assembly Bill 1890 restructured California's electric industry and established mechanisms to maintain the benefits of public goods programs for energy efficiency, research and development, renewable energy and low-income services. Before restructuring, the utilities provided many energy effciency programs that offered a wide range of public benefits.
LADWP funds its own Public Benefits Program, which concentrates on environmental conservation, community improvement and educational initiatives. In particular, the four main program initiatives center around funding for renewables technology, research and development, energy effciency as well as support of low income programs. The annual budget for the Public Benefits Program is currently approximately 65 million dollars, based on a requirement to annually collect 2.85% of LADWP's retail Power Fund Revenues, plus any interest earned on those funds. This amount is not to be less than the lowest expenditure of the 3 largest investor owned utilities in California. LADWP's Board has voted to extend the Public Benefits Program through 201 1. It should be noted that LADWP has not increased electric rates to fund this program.
Beginning in 2006, energy effciency program expenditures over and beyond the funding provided by the Public Benefits budget will be appropriated using the Energy Cost Adjustment Factor (ECAF) in accordance with the Rate Ordinance that has been approved for this purpose.
Since the inception of the Public Benefits Program in ì 998 through June 2005, the foil owing expenditures have been made:
November, 2007 D-15 Los Angeles Department of Water and Power 2007 Integrated Resource Plan Program Expenditures (in millions) Demand Side Management and Energy Efficiency...... $105 Renewables ...... ,...... $ 89 Research & Development and Demonstration Projects...... $ 65 Low Income & Lifeline, and Youth Services Academy...... $176 Total Expenditures...... $435
The following is an explanation of several of the Public Benefits Program initiatives:
I) Energy Effciency: Encouraging customers to reduce the amount of clcctricity used by promoting numerous effciency solutions. An array of incentives and services is available, including HV AC and lighting programs for commercial and institutional
customers, and Energy Star appliance programs for residential customers. Many of these and other programs are described in more detail in Appendix E. 2) Solar Photovoltaic: Promoting solar power by offering incentives to residential and commercial customers to support the installation of solar photovoltaic energy systems. LADWP also designs, installs, operates, and maintains solar energy projects at City buildings and facilities, including projects at LADWP's headquarters building, the Los Angcles Convention Center and several City libraries. 3) Pilot Fucl Cell Plant Project: LADWP has installed four high-effciency, advanced technology fuel cells representing nearly a megawatt of ultra-clean energy, including demonstration sites at the LADWP headquarters building, the Los Angeles Zoo, and Terminal Island Treatment Plant that are used to showcase this technology. 4) Trees for a Green LA: LADWP provides up to 7 free shade trees to residential customers to help reduce air conditioning demand and provides tree planting programs for schools, commercial and institutional customers, and communities. To date, more than 80,000 trees have been planted through these efforts. 5) Providing a Low Income and Lifeline Subsidy: The Public Benefits Program reduces a typical customer's bill by 15-50%, depending on the family's usage. 6) Supporting LADWP's Youth Services Academy: LADWP feels that involvement in education insures the development of a skilled, productive and competitive work force that benefits not only LADWP, but also the City as a whole.
Power Content Label
In i 997, Senate Bill 1305 was approved, which required Energy Service Providers (ESP) to report to their customers information about the resources that arc used to generate the energy that they selL. A form, called the Power Content Label, would be used for this purpose, which would also provide a common reporting method to be used by all ESPs.
In addition, the 2002 Senate Bill 1078 established California's Renewable Portfolio Standard, which included both a requirement for electric utilities to report annually to their customers the
November, 2007 0-16 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
resource mix used to serve its customers by fuel type, and to report annually to its customers the expenditures of public goods funds used for public purpose programs. The report should contain the contribution of each type of renewable energy resource with separate categories for those fuels considered eligible renewable energy resources, and the total percentage of eligible renewable resources that are used to serve the customers energy needs.
LADWP's 2007 Power Content Label is shown in Figure 0-6. As LADWP has two separate renewable programs, being l) the Renewable Portfolio Standard policy, and in addition 2) the Green Power for a Green LA program. Both of these programs arc reported on the Power Content LabeL.
- ,
. . Eligible Renewable....~.. B% 10ü% 5"" - Biomass & waste 1% 20% -01% -- Geothermal "1% ~1% 4% -- Small hydroelectric 6% 80% -c1% -- Solar "1% "1% "1% --Wind 1% .(1% ~1% Coal 46% 29% Large Hydroelectric 8% 31% Natural Gas 29% 35% Nuclear 9% O~/D Other ~1'1 0% TOTAL 100% 100% 100% , 88% of LADWP Power is specifically purchaset! from individual suppliers. .. 100% of LADWP Green Power is specifically purchased from individual suppliers '" Percentages are estimated annually by the California Energy Commission based on electricity sold to California consumers during the previous year .... In accordance with Los Angeles City Council's action on 10-5-04 for File I'Jo 03-2688 RPS, For specific information about this electricit product, contact LAD'WP at 1-800-DlAL-D'WP. For general information about the Pui."er Content Label, contact the California Energy Commission at 1-80G-55S-7794 Dr WW','i .energy.ca.go'ltconsumer
Figure 0-6: LADWP's 2007 Power Content Label
November, 2007 0-17
Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Appendix E. Energy Effciency and Demand-Side ., Management
-,
, t Overview
LADWP offers a variety of Energy Effciency (EE) and Demand-Side Management (DSM) programs to encourage residential, commercial, institutional, and industrial customers to implement energy effciency technologies and strategies.
DSM typically refers to electric utility initiated programs and activities designed to affect customer use of electricity in ways that are mutually beneficial to the customer and the utility. DSM options include conservation, customer generation, new and expanded use of electricity, and traditional and price-responsive load management. These DSM . , programs are designed to influence the time, pattern, and magnitude of participating
customers' electrical loads. As a result of these initiatives, LADWP customers are able to use less energy, thereby lowering their electric bills, and LADWP is able to avoid the
generation of electricity, thereby reducing its costs and emission of pollutants.
A host of new energy efficiency programs have been developed and arc aggressively
being implemented starting in 2006, in the areas of non-residential chiller effciency, small business customers direct install program, residential compact fluorescent lamp distribution, commercial building retro-commissioning (Rex), low income refrigerator exchange program, custom performance-based incentives, and others.
LADWP currently offers the following customer EE programs that provide financial incentives and information for customers that are replacing older equipment and appliances with higher effciency equipment (above what would he required by code).
The amount of the financial incentive is higher for the most efficient technologies.
Non-Residential Programs
LADWP Non-Residential programs have combined for sustained peak load reductions of over 119 MW and nearly 300 GWh of energy savings from the year 2000 to the present.
Commercial LightinlZ Effciency Offer (CLEO)
Lighting upgrades are among the simplest and most cost-effective retrofit measures that commercial customers can undertake. The CLEO program offers cash incentives to LADWP customers who install high efficiency lighting when they replace less efficient lighting equipment that operate during LADWP's peak hours of operation. Incentive levels arc based on the effciency of the lighting systems installed and no incentives are paid for minimum code-compliant lights or outdoor and other nighttime-only lighting.
November, 2007 E-1 Los Angeles Departmcnt of Water and Power 2007 Integrated Rcsource Plan
CLEO rebates arc based on a prescribed menu of products, which rcprcsents about 95% of the typical lighting change-out projccts.
Chiler Effciencv Pro"ram (CEPJ
. i Thc Chillcr Efficiency Program offers cash inccntivcs to commercial and institutional customers who rcplace less-efficient water-cooled chillers (which support HV AC systems in large buildings) with high-efficiency models. The replacements must significantly exceed Title 24 to be eligible for thc rcbate. LADWP has simplified the process by developing an easy-to-understand matrix detailing equipmcnt type, effciency levels, and size along with thc associatcd rcbate amount. Historically, customcrs operating large facilities in Los Angeles have participatcd in this program.
Non-Residential New Construction Prowam
This program encouragcs building owners, developers and design tcams to build and/or remodel nonresidential buildings that arc LEED (Leadership in Energy and Environmcntal Design) certified. Building owners and dcsign teams are also ofTered a prescriptive approach that offers incentives for installing equipment from an approved menu of energy effcient products. . Small Business Direct Install Pro"ram
This program provides energy effciency services to small busincss customers through the payment of 100% ofthc cost ofa lighting retrofit or air-conditioning tunc-up, up to a prcdctcrmined limit. The program consists of an on-sitc energy assessment of the facility, survcy of their existing lighting equipment, recommcndations for more effcient lighting
as appropriate, and an offer to install a limited amount of high effciency lighting equipment at no charge. A free air-conditioning tune-up may also be offered.
Non-Residential Retro-commissionini!
This program dcsignatcd as Non-Residential Retro-Commissioning (RCx) Pilot Program, provides incentives for operations and maintcnance opportunities in customer's facilitics to promote cncrgy and utility cost savings while maintaining building comfort. Over time, many buildings that havc bccn built and designed with energy effciency in mind, no longcr opcrate in accordance with the original effcicncy dcsign intent as a result of equipment deterioration, ncglect and the lack of funds for operations and maintcnance. Thc RCx approach quantities the building's energy bcnchmark, improves documentation and identifies the capital-intensive savings opportunities that improve thc building's encrgy performance.
Enerf! Audits
LADWP technical experts providc frcc on-sitc audits of commercial customer facilities upon request, examining lighting, HV AC, refrigeration, motors, and other energy-using
November, 2007 E-2 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
equipment and appliances, and providing detailed recommendations on technologies and operating strategies to reduce energy consumption and demand. LADWP engineers are also available to assist customcrs with complex systems and/or opcrating issucs.
-l Residential Programs
-, LADWP Residential programs have saved of ncarly 50 gigawatt-hours of energy sincc 2000.
Consumer Rebate Prozram (CRP)
The CRP is designed to both educate and encourage LADWP residential customers to purchase high et1ciency appliances, air-conditioners, and other energy-saving products that meet or cxcccd Energy Star cffcicncy ratings. LADWP offcrs cash rcbatcs to customers who purchase qualifYing equipment. More than 4,000 residential customers receive rebates annually. Program literature and applications are available at retail outlets and through LADWP (website, branch offccs, and by mail).
Refhzerator Recvclinz Prozram (RETIRE)
Rcalizing the potential for significant energy savings, LADWP provides refrigerator recycling for its residential customers. The program encourages customers to give up older, spare and inefficient refrigerators for rccycling in an cnvironmcntally sound manncr. LADWP provides this service at no cost to the customer and encourages participation by offering free compact fluorescent light bulbs (CFLs) as an incentive. Typically, in excess of2,000 refrigerators arc rccyclcd annually.
Trees for a Green LA (TFGLA)
LADWP encourages its residential customers to reduce their air conditioning bills and the negative environmental impact ofthe "heat island effect" by planting shade trees to shade their homcs. Thc goal of this program is to plant i 5,000 shade trecs annually. Customers must participate in a TFGLA workshop either online or in-person to qualify for their free trees. The workshop supplies valuable information rcgarding the stratcgic placement, planting, and care of trees.
Com/Jact Fluorescent Lizht Bulb (CFL) Distribution and CFL Manufacturer Buvdown
The LADWP strategically distributes CfLs to both familiarizc residcntial customcrs with this relatively new effcient light source as well as to save energy. In most cases, CFLs
match or surpass light output of traditional incandescent bulbs using only 1/3 of the clcctricity. Ncarly 136,000 CFLs have been distributed for residential use during the past
fiscal ycar. During fiscal year 2007-08, LADWP plans to distribute two CFLs to all of its approximately one million residential customers.
Novcmbcr, 2007 E-3 Los Angeles Departmcnt ofWatcr and Powcr 2007 lntegratcd Rcsourcc Plan
Morc than I million CFLs could be installed in the coming fiscal ycar in thc City of Los Angeles through a CFL Manufacturer Buy-Down Program. LADWP intends to work with manufacturers, wholesalers and retailers to provide discounted CFLs through rctail outlcts throughout the City. Tbe investor owned utilitics as wcll as othcr municipal utilities in California are successfully utilizing this strategy to achieve very significant energy savings.
Low Income Refrzerator Exchanze
This program providcs frec encrgy efficient rcfrigcrators to Low lncomc Discount Ratc and Lifeline customers in exchange for their ineffcient refrigerators which are recyeled in an environmentally responsible manner. A total of about 50,000 energy efficient refrigcrators arc cxpcctcd to bc distributcd during thc coming ycar.
Affordable Housinz Proiects
The affordability of housing goes far beyond its first cost. LADWP uses energy efficiency as a means ofreducing a home's operating costs, thereby making it a more affordable home in which to rcsidc. LADWP offcrs technical assistance to developcrs and architects of affordable housing projects. A broad range of energy effciency products and systems for new affordable housing projects may qualify for Economic Development loans provided by LADWP.
Partnerships
Education and Outreach
LADWP hosts tcchnical workshops to educatc customcrs on encrgy efficiency technologies and programs, and provides energy effciency information through participation at community events, presentations to business and community organizations, and in spccial cducation and outrcach campaigns.
City or Los Anzeles Department or Azinz
As part of this cooperative effort, LADWP presents free encrgy efficiency seminars to senior citizens. Each presentation offers valuable energy effciency information and tips that help "seniors" better manage their electric bill. The event culminates with the distribution of free CFLs for all participants. On a liniited basis, L¡\.DV¡P provides energy et1cient refrigerators in exchange for older less-effcient models owned by senior citizcns. Also annually fundcd is an Emcrgcncy Fan Program through which scnior citizens receive free energy effcient circulating fans.
November, 2007 E-4 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
City of Los Anl!eles Bureau of Sanitation
LADWP teams with the Bureau of Sanitation each post-holiday season to encourage the environmentally-friendly recycling of Christmas trees. Project participants are rewarded with free CFLs and tree seedlings to help them save cnergy. 'I
Enerl! Star (Environmental Protection Al!encv)
As an Energy Star partner, LADWP partners with utilities nationwide in promoting energy effcicncy campaigns. These efforts rely heavily on media exposure and printed literature to communicate pertinent, seasonal energy efficiency messages to utility customers.
-, Flex Your Power
LADWP partners with utilities throughout California in communicating the importancc of energy effciency. The Flex Your Power campaign broadcasts this valuable message through television ads, radio spots, printed literature, and retail displays.
Literature Development
A library of free energy efficiency literature is available to all LADWP customcrs. The literature highlights LADWP programs, general conservation principles, and energy- effcient product information.
Customer Electrifcation Program
The customer electrification program is another EE and DSM customer program that will promote thc replacement of existing combustion powered equipment with electric and plug-in hybrid-electric powered cquipment. Instead ofreducing a customer's electrical load and energy consumption, as with conventional EE and DSM programs, the Customer Electrification Program will actually increase a customer's electrical energy consumption and demand, primarily off-peak, but will ultimately be more cost-effective, environmentally sound and overall energy effcient for the customer. This will incrcase electric sales over the next fcw years as customers increasingly use electricity, rather than fossil fuels to power the equipment, such as those shown bclow.
Energy use is projected to increase to 300 GWh annually by 2017, with a corresponding on pcak demand increase of20 MW (as shown in Table E-I), due to replacement of combustion powered equipment with clectric powered and plug-in hybrid equipment promoted by the Customer Electrification Program. This will incrcase DWP revcnues by approximately $2 i million and will also add about 50 MW of off peak demand. This is
an ideal Demand Side Managemcnt (DSM) program to shin demand to off peak.
November, 2007 E-5 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Equipment to be modified to consume more electricity rather than fossil fuels:
. Forklifts . Utility Carts . Lawn Equipment . Truck stop refrigeration and air conditioning . Airport ground support equipment . Utility trucks . Plug-in hybrid vehicles . Port support equipment . Ships in port
Table B-1: Customer Electrification Program - Sales and Capacity
Calendar Y car 2006 2007 2008 2009 2010 2011 21112 21113 21114 2111S 2016 2017 On Peak MW I 3 5 6 8 10 II 13 15 16 18 20 Off Peak MW 2 7 12 15 20 25 27 32 37 40 45 50 GWh Sales 25 50 75 100 125 150 175 200 225 250 275 300 Revenue (SM) 2 3 5 7 9 10 12 14 16 17 19 21
November, 2007 E-6 Los Angeles Department at Watcr and Power 2007 Integrated Resource Plan
Appendix F. Distributed Generation -,
., Overview
Distributed Gcncration (DG) is a concept of installing and operating small-scalc clcctric generators, typically less than 20 MW, at or near an eJectricalload and are interconnected to thc clcctric utility distribution system. The most common tcchnologics used today for DG are turbines and intcrnal combustion engines, however new technologies including fucl cells, microturbines and solar photovoltaics are now being developed. The promise of DG is to provide electricity to customers at a reduced cost and morc efficicntly than the traditional utility central gcncrating plant with transmission and distribution wire losses. Othcr bcncfits that DG could potentially providc, dcpcnding on the technology, include reduced emissions, utilization of waste heat, improved power quality and reliability and dcfcrral of transmission or distribution upgradcs.
DG can be customer installed or utility installed. The benefits for customer installed DG include waste heat recovery, backup power and power quality. The bencfits for utility installed DG include generation, transmission and distribution intÌ'astructure deferral, and reduction of delivery losses.
Distributed Generation on the Grid
The introduction of competition into the electric marketplace has driven the developmcnt of new electrical generation technologies. Most tcchnologies being developed for DG applications are morc costly than traditional generating resources, however it is anticipatcd that with advances in the technologics and a grcater demand for DG, costs will be reduced and more installations will take place.
LADWP currently has approximatcly 350 MW of customer installed DG on its electrical grid, producing approximately 1,700 GWH annually, most of which is consumed on-site, although
some (approximately 40 MWh/h) is exported back to DWP. Most of the customcr install cd DG (approximately 300 MW) is made up of 20 MW or larger natural gas combustion engines. The amount of customer DG installed in the future will depend on several factors including reliahility, cost of the tcchnologics, and natural gas and electricity prices. With stable electricity prices and high natura! gas prices, customer generation becomes less attractive. Additionally, more than 700 LADWP customers have installed over J 0 MW of solar photovoltaic cncrgy ~ systems with the help ofLADWP's Solar lnccntive Program. LADWP has installed ncarly i MW of solar photovoltaic energy systems on LADWP and City of Los Angeles facilities to generate clean, renewable cncrgy for thc LADWP grid. LADWP has also installed various othcr DG technologies for demonstration purposes to understand thc operating issues and benefits associated with various cquipmcnt, and to promote the
November, 2007 F-l Los Angeles Department of Watcr and Power 2007 Integrated Resourcc Plan development of ncw clcan, cfficient technologies. Future DG installations for dcmonstration purposes will showcase new tcchnologies and should add approximately I MW in capacity cvcry thrcc ycars. These projects will be funded with Public Bcncfits funds.
Utility installed DG may also playa rolc in meeting capacity needs in the future that havc vcry low cncrgy production requirements (low capacity factors). It is estimated that approximately i MW ofDG will bc installed annually beginning in 2010. Tablcs F-I and F-2 provide projections of DG and Solar photovoltaic capacity and energy, and is summarized in Table F - 3.
Table F-l : Projected Distributed Gcncration Capacity and Energy - Cumulative
Calendar Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 ..m"_ .. " " 0 MW 290 280 290 300 302 304 306 308 310 312 314 316 8 -.; -o "E ~ " U c3 GWh 1650 1600 1650 1700 1720 1730 1740 1760 1770 1780 1790 1800 " 0 MW I I 1 2 3 4 6 7 8 10 II 12 .~~.- ~ ::- ;." ;: E (. GWh 4 4 4 8 9 10 15 16 17 22 23 24
Table F-2: Projccted Solar Photovoltaic Generation Capacity and Encrgy - Cumulative
Calendar Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 .. ;; " "" MW II 14 20 30 45 65 90 120 155 195 235 280 oE "0" -"~ =-" U -c GWh 15 20 30 50 70 100 140 190 250 310 380 450 ;; "" "" MW I I I I 2 2 2 2 2 2 2 2 Q:s "0~ -i " .. t:-" GWh I I 2 2 2 2 2 3 3 3 3 3 NOTE: The LADWP Solar Program is currently authorized only through 201 i, however recent State legislation Sfl mandates the program be made available througb 2016,
November, 2007 F-2 Los Angeles Department at Water and Power 2007 Integrated Resource Plan
Table F-3: Summary of Annual MW ofEE, DSM and DG Additions
Summary of DG, Solar PV and Customer Electrification Projected Annual Increases Row 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1 Excess Customer DG 10 10 10 2 2 2 2 2 2 2 2 2 UlilityDG 1 0 1 1 1 2 1 1 2 1 1 , 3 Customer PV 3 6 10 15 20 25 30 35 40 40 45 4 LADWP PV 1 0 0 1 0 0 0 0 0 0 0 5 Customer Electrification Program c' '" C§ C§ -10 .J Jl -15 .16 :1 -20 Total Annual Projections 12 11 15 11 13 18 20 23 28 25 28 Total Cumulative Projections 12 23 38 49 62 80 100 123 151 176 204
Row Noles 1 See Table F-1. The October 2006 Load Forecast incorporates existing Customer DG. Future years are converted to annualized values 2 See Table F-1. Converted to annualized values 3 See Table F-2 10 MW of existing Customer PV is deducted. Future years are converted to annualized values. 4 See Table F-2 1 MW of existing LADWP PV is deducted. Future years are converted to annualized values. PV funding continues through 2011. This IRP assumes a continuation of the program for future years. The October 2006 Load Forecast incorporates the existing 10 MW Customer PV and 1 MW LADWP PV 5 See Table E-1. 2 MW per year growth assumed for years 2018 - 2026. The values are negative as they act to add load.
The following is a discussion of the most common DG technologies under consideration.
Internal Combustion Engines
Internal combustion engines (ICE) include reciprocating engines and combustion turbines. Improvements have been seen recently in the emissions and effciencies of reciprocating engines and combustion turbines. Combustion turbines have typically been in tbe multi-MW size, but recently small-scale combustion turbines, or microturbines, have been developed.
Microturbines are machines ranging in size trom 28 kW to 500 kW, wbich include a compressor, combustor, turbine, alternator, rccouperator, and generator. They have the potential to be located on sites tbat have space limitations to produce power. The advantages of microturbincs arc that tbere are a small number of moving parts, are compact in size, are lightweight and can utilize waste fuels.
LADWP has installed nearly 2 MW of micro turbines, the first of which was located at LADWP's Main Street Center in 1999. Additional microturbines have been installed at LADWP facilities and the Lopez Canyon landtilL
Fuel Cells
A fucl cell combines hydrogen and oxygen to produce electricity througb an electrocbemical process. Besides electricity, they produce water and heat. If the oxygen source is air, then small amounts of nitrous oxides may also be emitted. Fuel cells produce energy at relatively higher effciencies and emit far fewer air pollutants than combustion technologies. Fuel-cell power plants are now becoming commercially available for use by electric power producers, industrial facilities, and large commercial buildings. Smaller systems for residential and small commercial buildings and transportation applications are expected to be commercially available early in the
November, 2007 F-3 Los Angeles Department of Water and Power 2007 Integrated Resourcc Plan coming ycars. The pricing for these products is expected to become compctitive due to several factors:
. A fucl ccll is a fairly simple technology with reasonably priced components.
. Significant recent investmcnts in the technology are accelerating the development of fucl cells and costs are bcing reduced.
. Integrating fucl processing and power conditioning equipment can bc a significant cost with regard to fuel cells, but rcductions are likely as more fuel cells are manufactured and installed.
LADWP has installed a total of four 200-250 kW fuel ccll power plants in various locations in Los Angeles that arc providing considerable experience and data.
Photovoltaics
Solar energy is converted to electricity using two power technologics: photovoltaic systems and solar thermal power systems. Photovoltaic, or PV, systems convert sunlight dircctly into electricity. PV systems are modular, portable, highly reliable, and have low environmental impact, making them ideal for power applications of all sizes. Scvcral large PV systems capable of powering hundreds ofhomcs arc now connected to utility grids throughout the Unitcd States. Many utilities are installing these systems on thc rooftops of schools or customer's homes.
A typical 4 kW AC residcntial rooftop solar power system produces 6,000 kW-hours pcr ycar. Presently, LADWP has installed about i MW ofPVs at LADWP facilities and other City of
Los Angeles facilitics. LADWP incentives have supported the installation of about 10 MW on our customers' properties. LADWP has madc a commitment of S; i 50 million through 2011 will continuc to support the PY program. In 2006 State legislation, SBI, rcquircd all utilities to offer incentives to customcrs to install solar energy systems through 2016. LADWP's solar inccntive program will be modified to include a goal of encouraging thc installation of an additional 270 MW of customer installed solar PY systems by 2016, with a budgct of $313 million over 10 years.
The energy generation charactcristics of a typical photovoItaic installation is that thc output peaks around I :00 p.m., and about 90% of a solar photovoItaic systcm's energy is produced from 10:00 a.m. to 4:00 p.m. during a typical summer day in California. Another point worth noting is that a solar photovoltaic system can be designcd to coincidc more closely to the system load profile by altering the module's orientation. Vlhile this 'will increase the energy produced during the peak load of the utility, it will result in an ovcralllowcr amount of energy produced for the day. Cloud covcr also affects the energy output of a solar photovoltaic installation. The type of clouds will either raise or lowcr the output of the photovoltaic system. Darker rain clouds will lowcr photovoltaic output but a light marine layer may actually producc more energy than the nameplate rating of the modules duc to light reflecting off of the modules, back to the atmospherc, and then back to the modules. This does not happcn oftcn but does cause design issues that are taken into account.
November, 2007 1'-4 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Appendix G. Fuel Procurement Issues
Overview
. i As is shown in Figure 4, LADWP generates 30% of energy from natual gas-fired generation. Or, in other words, about one-third of LADWP's energy generation is exposed to the risks of gas price volatility. Figure G- I below graphically illustrates the daily natural gas spot market pricc (including delivery charges to LADWP's gas plants) and the large price fluctuations from the year 2002 to 2006.
Figure G- I: Natural Gas Daily Spot Prices
As is shown in Figure G-I, the natural gas market has been very volatile with extreme variations of prices. Since gas currently plays such an important role in LADWP's generation portfolio, it is paramount that the impact of gas price volatility to the resource plan be mitigated.
To minimize LADWP's exposure to natural gas price volatility, LADWP has implemented a variety of actions since the 2000 IRP, which include: I) Formed an Executive Risk Policy Committee to provide oversight over energy risk management activities, including natural gas.
Novemher, 2007 G-l Los Angeles Department of Water and Power 2007 Integrated Resource Plan
2) Developed a natural gas procurement strategy that includes a financial hedging program. Fiscal year 2003-2004 was the first complete year for using financial hedging to cap gas prices over a portion of the forecasted gas requirements. 3) LADWP obtained approval from the Los Angeles City Council to delegate its award authority to LADWP's General Manager for approving gas procurement contracts. LADWP also approved pro forma NAESB (North American Energy Standards Board) contraets for use in procuring natural gas. 4) LADWP has partieipated with the Southern California Public Power Association (SCPP A) in an RFP soliciting proposals for a term supply of natural gas for 20 years for up to an average of27,500 MMBtulDay. MMBtu stands for million British thermal units, and is a commonly used measurement for natural gas. LADWP will prepay the cost of the gas production from bond financing once the final agreement is negotiated. 5) LADWP has participated with SCPP A in purchasing an active gas reserve in the Pinedale anticline area of Wyoming. This reserve is currently producing approximately 20,000
MMBtuDay, of which LADWP receives approximately 83% ofthe project 6) LADWP has also replaced approximately i, i 00 MW of electrical generation with combined cycle technology. This technology is much more efficient in generating electricity than the generating units that were replaced, resulting in a 30% to 40% decreased usage of natural gas to generate the same amount of electricity.
7) As a result of implementing the accelerated RPS, LADWP's usage of coal will be reduced considerably. As noted in Figure 5, LADWP's power system pereentage of energy generated from eoal will be reduced from 47% in 2006 to 43% in 2010. Natural gas usage will also be reduced, going from 30% in 2006 to 22% in 2010.
A general discussion on natural gas pricing issues is provided in the following sections.
Natural Gas Pricing Issues
Gas delivered to the burnertip for electric generation in California is comprised of three elements: i) commodity costs; 2) interstate transportation; and 3) intrastate transportation.
Commodity Costs
Natural gas for electric generation is produced primarily outside California in areas known as basins, such as the Green River Basin near Opal, Wyoming, the San .Juan Basin near San Juan, New Mexico, and the Permian Basin in west Texas. Gas produced from individual wells is gathered by small pipeline systems and delivered into a gas plant that processes the raw gas into pipeline quality gas for delivery to markets. Prior to the 1980's this pipeline gas was sold as a bundled product by various interstate pipelines to distribution companies in the individual states, such as the Southern California Gas Company (SoCal) and the Pacific Gas & Electric Company (PG&E). Eventually interstate gas rates were restructured so that interstate pipelines became
November, 2007 G-2 Los Angeles Departmcnt of Water and Power 2007 Integrated Resource Plan
transport-only businesses with the gas marketing function spun off , , to the market via unregulated affliatcs or independent marketers.
Intensified exploration in traditional producing arcas of the country and development of coalbed methane resources in the Rocky Mountains are intended to stcm pcrccptible dcclines in gas
production in morc traditional supply areas of the country, although this has not happcncd yet. The development of Liqueficd Natural Gas (LNG) facilities in the United States and Mexico
over the next five years may help to mitigate the typc of volatility seen in the period 2000-2001. Howcvcr, thc siting of LNG terminals has become a battlefield over environmcntal and safety
issues, severely impeding thc dcvelopment of badly needed terminals. Similarly, developmcnt of
resources known to exist in the United States offshorc contincntal shelf has been stalled, caught up in thc same politically charged debate.
- ,
Interstate Trans/Jortation
Thc interstate pipeline companies that formally sold bundled gas with thcir transportation
services havc now focus cd primarily on the transportation of gas from producing basins to interconnections with the individual statc's local distribution companies, The jurisdiction for the
regulation of these companies falls under the authority ofthc Fcdcral Energy Regulatory Commission (FERC). California is currently served by six interstate pipelines although only four are actually directly connectcd to supply basins. The other two redistribute gas from other
interstates. Volatility in gas prices into California has ariscn bccause of the loss of the supply surlus sccn in thc past, lack of1iquidity stemming from fewer suppliers in the aftcrmath of the shakeout following 2000-2001, and wcather-related events througbout the countr. Limited
price discovery has also added an element of uncertainty in gas transactions. California has become moderately over-piped since the Kern River 2003 Expansion was placed into service in May 2003. This condition predominated throughout the early 1990's. LADWP has terminated its firm Mojave pipeline capacity although it continues to hold its EI Paso capacity pending the outcome of restructuring initiatives for firm receipt point capacity. LADWP has firm capacity on the Kern River pipeline approximately equal to its forecasted average gas requirement.
Intrastate Trans/Jortation
SoCal is the sole provider of intrastate gas transportation services in Southern California. These services consist primarily of delivering gas from the interconnections with interstate pipelines near the California border, but also inelude storage, balancing, wheeling, parking, and loaning gas. Ever since May 1988, SoCal has been relieved of its obligation to serve the so-called non- core customers, those who are able to make their own arrangements for procuring their own gas. All electric generators such as LADWP are deemed non-core or transport-only customers. The c, rate charged by SoCal for this transportation only service is regulated by the California Public
Utilities Commission (CPUC). This rate is the lowest for any customer elass (outside of any special negotiated rate) because it provides the minimum service and provides as close to cost- of-service pricing as possible. LADWP's active participation in SoCal's rate cascs at the CPUC was instrumental in achieving this distinction. Elcctric generation transportation tariffs were oncc as high as $1.1 O/MMBtu 8 years ago but have since been reduced to Icss than
November, 2007 G-3 Los Angeles Department ofWatcr and Power 2007 Integrated Resource Plan
$0.40/MMBtu. However, this may change pending a number of regulatory actions beforc thc CPUC which may rcsult in rate adjustments for all SoCal non-core customers.
Additional services relating to the delivery of gas are available from SoCal but the ratcs arc subjcct to negotiation and usually, CPUC approval. Generally speaking, these services are of more value to marketers than to municipal generators, but in any casc add to the cost of delivered gas.
One issue that has cmcrgcd from the recent price volatility in Southern California is whether or not SoCal has the ability to accept all the gas that will bc filling thc expanded interstates over the ncxt fcw ycars. The CPUC has addressed this issue in a recent proceeding into the adcquacy of SoCal s system to servc thc cxpcctcd load on its system. So far no conclusions can be made but SoCal is confident that they have the problem in hand bccausc of its rcccnt completion of various systcm upgradcs increasing takeaway capacity by approximately 11 %. SoCal has signalcd its intention to revamp its intrastatc transmission system to address the possibility of Liquefied Natural Gas supplies arriving in the 2008 timeframc.
Rezulatory/Lezallssues
Scvcral issues at the CPUC and FERC also impact pricing. Currently therc arc a number of proceedings cxamining the causes of the unprecedented run-up in gas prices into California over the 2000-200 I winter. Also, SoCal anticipatcs rcvising its rates to accommodate the impending delivcry of Liquefied Natural Gas in 2008 into California, through the implemcntation of what is known as the Firm Acccss Rights (FAR) decision. Implementation of FAR will affect the role of transportation pricing and the distribution ofreccipt point allocations for deliveries into the California market. However there are active challenges to the decision which may delay or cvcn reverse the implementation of FAR bcfore the scheduled in-service date in early 2008. Another issue regarding the SoCal systcm is thc WOBBE number. The WOBBE number relates to the cncrgy content ofthe natural gas delivered into SoCals system which affccts opcrating characteristics of gas turbincs and emission levels. The WOBBE number has risen to prominence due to environmental concerns which may substantially affcct SoCal's service to
electric gencrators. There are currently court challenges to SoCal's allowable levels of WOBBE that may severely impact LADWP operations.
The FERC is presently prcparing ncw tariff sheets for the Kern River pipeline in which LADWP has a substantial interest Kern River had applied for a substantial ratc increasc but lost after a
long proceeding at thc FERC. The tariff sheets are anticipated before the third quarter 01'2007.
Gas Price Volatilitv
There was a blowout in prices ovcr thc wintcr 2000-2001 that was somewhat repeated in milder form bricfly in early 2003 and the second half of 2005. For the most part cxtrcme volatility has subsided but prices remain at substantially higher levels than in previous years. The industry has cndcavored to reduce volatility through a massive effort of injecting gas into storagc for winter use, thereby eliminating thc pcrception of a huge overhang of expected gas purchases during the winter
Novcmbcr,2007 G-4 Los Angeles Department of Water and Power 2007 Intcgrated Resource Plan
heating season. By the end of thc storage season on Octobcr 31, 2006, reservoirs nationwide wcre filled to record levels including SoCals system storage. Howcvcr, forward pricing rcmained high because of the perception that overall U. S. gas production is in serious decline and anticipation of
. , another robust hurricane season. It is expected that gas price volatility will be reduced for LADWP
through a program of financial hedging, and in view of the gas industry's and government's reaction to 2000-2001 's pricing blowout, the problem should not be repeated again, or at least will not occur with the same degree of severity.
Gas Suoolv Issues
In the aftermath of the financial collapse of Enron, gas price discovery has bccome problematic. The trade press providcs some guidancc to market pricing but given the reluctance of marketers to discuss price in an environmcnt filled with invcstigations of alleged market manipulation, the basis for daily pricc trends is suspiciously limited in volumc. Federal regulatory agencies have become interested in the currcntly unregulated activities of hedge funds and their ability to affect markets. Thc rccent failures of two hedge funds and thc rcvelations of reckless trading indicate that there will be more rcporting requirements placed on market participants.
Also because of the Enron collapse, creditworthiness has becomc a primary issue in dcciding whether or not to execute pro forma gas purchase agrccments with potential suppliers. The number of possible countcrparties has diminished in size due to crcdit concerns, consolidation and retrcnchment throughout the industry.
Natural Gas Procurement Strategy
LADWP retaincd the services ofPriccWaterhouse Coopers (PwC) in 2003 to asscss, validate and vcrify LADWP's currcnt gas procurement strategy. Their report assessed the current strategy, suggested changes and enhanccments to that strategy, and prepared a preliminary plan and timetable for implcmcnting the changcs.
As a result of PwC's review of gas operations, LADWP decided to adopt a program of protecting its gas costs from price volatility through financial hedging. The appropriate authority was sought and received by the City Council to employ financial hedges for up to five years and to limit spending for this effort to no more than $15 million per year.
Tn addition, an executive risk policy committee was formed with senior management as membcrs to provide oversight over the energy risk management activities of LADWP, ineluding natural gas.
A first step was taken by LADWP's Financial Services Organization (FSO) through negotiating individual ISDA (International Swaps and Derivatives Association) agreements with potential counterparties for the swaps to hedge gas prices. Fiscal year 03-04 was the first complete year for using financial hedging to cap gas prices over a portion of forecasted gas requirements.
November, 2007 G-5 Los Angelcs Dcpartmcnt of Water and Power 2007 Integrated Resource Plan
Secondly, LADWP also obtained approval of two ordinances from thc Council authorizing thc Board of Water and Power Commissioners to delegate its award authority to the General Manager for approving gas procurement contracts. Subsequently the Board approved two separate pro forma NAESB (North American Energy Standards Board) contracts for use in procuring natural gas for up to one year, and for up to five years in duration. A number of the one-year NAESB agrccmcnts arc now bcing used to buy gas. No decision has been made as yet to buy a 5-year strip of gas.
Third, LADWP participatcd through SCPP A for a RFP process soliciting proposals for a term supply of natural gas for 20 years for up to an average of 27 ,500 MMBtuDay. LADWP will prepay thc cost of the gas production from a bond financing once the final agreement is negotiated with the short-listed candidatc.
Fourth, LADWP has participated with the Southern California Public Power Association (SCPP A) in purchasing an activc gas rcscrvc in thc Pinedale antieline area of Wyoming. The reserve is currently producing approximately 20,000 MMBtuDay, of which LADWP is rccciving 15,000 MMBtu/Day, or approximately 83 % of the project Savings from this purchase have totaled approximately $28,000,000 for the two ycars of ownership. Further production is indicated by virte of the fact that neighboring production has becn approvcd for drilling on 10-acrc spacing, up from the current 20-acre spacing, by the Wyoming Division of Oil, Gas and Conservation. Other production adjaccnt to thc SCPP A production has already shown promise although development awaits a number of environmental challenges.
PwC noted LADWP's previous gas procurement stratcgy was highly dcpcndcnt on spot market purchases and lacked the flexibility necessary to appropriately manage the price risk involvcd in gas buying, trading, and transportation activities. They argued at the time that price risk was a critical issue because gas was playing an incrcasingly important role in LADWP's future due to increased reliance on natural gas-fired generation. (Note that the 2000 lRP had rccommcndcd rcpowcring four natural gas-fired generating stations and adding six gas-fired simple cyele combustion turbines to make up for a sale ofa portion ofLADWP's intcrcst in thc coal-fired Mohave plant, to replace units that were over 40 years old, and to meet anticipated load growth). Additionally, the increascd usc ofrcncwablcs, such as wind farms and solar projects, may require higher levels of reserve margins because of their intermittent natue, with thc highcr rcscrvc margins bcing providcd by gas-fired generation. Also, gas price volatility and constraints on the Southern California Gas intrastate transportation systcm rcquircd LADWP to placc morc importance on gas supply management. lmolementatiûn Actions
LADWP has adopted strategies to reduce exposurc to daily gas pricc swings by the use of monthly spot purchases, implemented index based financial swaps, and acquired a gas reserve. Monthly spot purchases lock in first ofthc month indcxcs and rcducing the volumes subject to floating daily prices. The reserve acquisition will reduce overall costs through amortization of the purchase price for the reservc. Additional back officc proccdures were put in place to provide better deal tracking and audit trails.
November, 2007 G-6 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
An important initiative was put into play to obtain delegated authority from the City Council to allow LADWP management to execute SoCal's Master Service Contracts. This contract would also allow the LADWP to take advantage of additional services offered by SoCal such as
storage, parking, loaning and wheeling. Completion of , the initiative is expected in early 2008.
Additional Actions to be Considered
With respect to transportation and storage options, LADWP will need to evaluate its options in view of the aggressive schedule adopted by the Board of Commissioners in meeting its goals for implementation ofrenewable technologies for generation. The successful completion of a number of renewable energy projects will dramatically impact the need for natural gas ~ , generation. To this end, LADWP sbould begin to develop standardized methods for evaluating capacity projects. Factors to consider in evaluating options inelude:
. Cost of being short gas supply . The amount of fuel carried in inventory for emergencies . The type of fuel carried in inventory for emergencies . Cost of alternatives . DSM . Spot power purchases . Alternative generation costs . Service interruptions . Political and budget impacts
. Cost of being over-contracted for off~peak periods
. Cost of new capacity (initial capital and demand and charges) . Value of excess capacity sold on short-term basis
These factors should be applied to the contracting options that will range from meeting baseload requirements to meeting peak requirements. If LADWP decides to only contract for baseload
requirements, then LADWP will be continuously managing a short position of varying levels on a daily and monthly basis. If LADWP decides to contract for peak demand levels, LADWP will
be in the position of managing long positions on most days and months. The key with physical supply, transportation, and hedging strategy development is to find the optimal contracting / hedging levels based on the above factors.
SoCal is LADWP's only available intrastate transportation supplier by virtue of its authorized franchise. Since SoCal provides 100 % firm full requirements service, LADWP's transportation need is met. Storage is being developed by others but in the meantime LADWP has leased an appropriate amount of inventory space, injection rights and withdrawal capacity from SoCal on a year to year basis. Storage is most effective contiguous to load centers and unfortunately the most geologically effective sites in the greater Los Angeles area have already been developed by SoCal. Storage service, including firm injection and withdrawal capacity, is primarily useful for minor load balancing and to some extent, hedging. Given the robustness of SoCal's distribution
November, 2007 G-7 Los Angeles Department of Water and Power 2007 Integrated Resource Plan system in particular, and the interstate transportation system in general, storage is not necessary for emergency backup supply for power generation.
In addition to providing a systematic means by which to evaluate storage and transportation options, LADWP should takes steps to improve its analytical capability. Furthermore, LADWP should actively manage its natural gas supply portfolio and provide management oversight for all hedged transactions.
Summary
LADWP also proposes to take the following actions and to provide additional flexibility in implementing its natural gas procurement strategy:
. Increase the long-term natural gas hedging price cap. LADWP's authority for purchasing financial swaps for long-term natural gas is currently limited to $7.50 per MMBtu.
. Increase the short-term physical natural gas purchase price cap. LADWP's authority for purchasing short-term natural gas is currently limited to a rolling twelve months at $20.00 per MMBtu.
. Obtain delegated authority to execute SoCal's Master Services Contracts along with the attachments for ancillary services. . Increase the term limitation for its short-term power purchases. LADWP's authority for purchasing short-term power is currently limited to a rolling twelve months from date of execution. . Seek authority to enter into long-term power purchase hedging contracts. LADWP is currently not authorized to enter into such arrangements.
In summary, LADWP has attempted to mitigate the impacts of volatile natural gas supplies and prices by acquiring a natural gas field, utilizing financial hedging contracts, and rcpowcring over 1000 MW of electrical generation with more effcient combined cycle technology. FSO estimates that the savings to LADWP resulting from these actions exceeds 980 million dollars.
November, 2007 G-8 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Appendix H. Transmission System
Overview
LADWP owns and operates an extensive network of Alternating Current (AC) and Direct Current (DC) transmission lines. Its internal grid is made up ofa network of 115-kilovolt (kV), 138-kV, and 230-kV overhead and underground AC transmission lines. LADWP's long distance bulk power system consists of230-kV, 287-kV, 345-kV, and 500-kV AC lines and:t 500 kV DC lines. In terms of circuit-miles, Table H-I illustrates LADWP's transmission resources:
Table H-1: Breakdown of Transmission Resources
Voltage Level AC/DC Location Circuit-Miles Current 500-kV DC Out-of-Basin 1068 500-kV AC Out-of-Basin 1892 345-kV AC Out-of-Basin 101 287-kV AC Out -of- Basin 343 230-kV AC Out-of Basin 230 Bulk Transmission Circuit-Miles 78% 3634 230-kV AC In-Basin 676 138-kV AC In- Basin 299
I 15-kV AC In-Basin 44 Basin Transmission Circuit-Miles 22% 1019 Total Transmission Circuit-Miles 100% 4653
As Table H-I shows, the majority of LADWP's transmission assets are located outside of the Los Angeles basin. These resources, its "bulk transmission assets," extend LADWP's reach so that energy trom low-cost generation resources located out of its service territory may be transmitted to LADWP's customers. While LADWP's customers consume approximately 10% of all the electricity within California, its transmission capacity is approximately 25% of California's total transmission capacity, thus ensuring its customers are provided with a reliable supply of energy from the lowest cost resources. The reach and capacity of LADWP's transmission portfolio also enables LADWP to purchase and sell energy in wholesale electricity markets using short and long-term agreements. Excess transmission capacity, or capacity not used at any given time to serve LADWP customers, is sold through a wholesale market that had its genesis when the federal Energy Regulatory Commission (fERC) ruled in 1996 that all utilities under its jurisdiction must establish open-access transmission tariffs (OA TTs) and implement open-access same-time information systems (OASIS). Although municipal utilities, ineluding LADWP, are not subject to fERC's regulations, LADWP voluntarily meets these new industry standards.
November, 2007 H-I Los Angeles Department ofWatcr and Power 2007 Integrated Resource Plan
LADWP is an active participant in the Western Systems Power Pool (WSPP) and the Western Electricity Coordinating Council (WECC) which work cooperatively to conform to North American Electric Reliability Corporation (NERC) standards and practices. In addition, it is LADWP's policy to coordinate bulk transmission planning activities with other utilities and transmission service providers, encouraging partnership and cooperation in thcsc activities. LADWP differentiated itselffÌ'om many otits counterparts in that LADWP maintains ownership and operation of its electric generation, transmission and distribution assets. This vertically integrated structure enhances service reliability so that LADWP customers, unlike the majority of Californians, were not subject to rolling blackouts during statewide electricity crises.
A one-line diagram showing some of the key bulk power transmission lines arc shown in Figurc H-l. The transmission capabilities of the different systems are summarized in Table H-2.
Table B-2: Import Capability ofLADWP Bulk Power Transmission Resources
Transmission System Transfer LADWP Share Ratinl! (MW) (MW)5 East to LA Basin 4,000 3,566 Wcst-of-thc-Rivcr 10,1181 3,3521
East-of-the-River 7,5501 i , 2371,¿
Pacitic DC Intertie (N-S at NOB) 2990", 696'"
California-Oregon Intertie (N-s at COB) 4800", 320'" Owens Valley Transmission Line 300 300 Southern Transmission System 1,920' 1,143 Northern Transmission System, Mona to Intermountain 1,2004 44l Northern Transmission System, Gonder to Intermountain 1174 434 Notes: 1 - The total transfer capability into Southern California and the interdependence of these systems is determined by seasonal nomograms called SCIT. 2 - LADWP's share may be increased up to 1,521 MW depending on the result of on going discussions with the other path owners. 3 = The total transfer capability into Northern California and the interdependence of these systems is determined by seasonal nomograms. 4 - LADWP shares on the 1\TS depend on the IPP Excess Power recalls. Capacities shown arc transmission available for winter 2005 season (9/25/05 to 3/24/06). The summer 2006 shares are lower. 5 = These are import capacities of the paths. Export capabilities are discussed individually as needed in the following subsections.
November, 2007 H-2 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
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Figure H-l: LADWP Transmission Resources
November, 2007 H-3 Los Angclcs Dcpartmcnt of Water and Power 2007 Integrated Resource Plan
A brief description of LADWP's transmission resources, their capabilitics and any known cxpansion plans follows.
Basin Transmission System
This system consists of a nctwork of 115-, 138-, and 230-kV overhead lines and underground cables interconnecting 20 receiving stations, four switching stations, four basin thcrmal gcncrating stations, two small hydro power plants and one pumped storage hydro power plant.
The present basin transmission system is capable of handling expected systcm pcak loads for thc ncxt four years. Beyond that, studies have indicated that construction of a new receiving station in the San Fernando Vallcy arca will bc rcquircd to mcct LADWP's forecasted load growth. To support long-term growth, LADWP is exploring increased utilization of the basin transmission systcm, or "beltlincs," by dynamically rating these transmission lines to take advantage of their higher current-carring capacity during coolcr wcathcr. This tcchnique to upgrade capacity is currently being studied on the Valley-Toluca and Rinaldi-Toluca lines.
East-to-LA Basin Transmission System
This system consists of three 500-kV and two 287-kV lincs that transmit powcr from thc AdelantolVictorville area to the Los Angeles basin. At the present time, LADWP is studying possible upgradcs to thc 287-kV lincs to increase the power transfer capability into the basin and increase LADWP's access to renewable energy sources.
Wcst-of-the-River (WOR) and East-of-the-River (EOR) Systems
LADWP's WOR system consists of three 500-kV and one 287-kV linc that transmit powcr from thc McCullough/Marketplace area to the AdelantolVictorville area along the WECC WOR path.
The WOR path consists of several Extra-High Voltagc (EHV) transmission systems that
interconnect the Nevada/Arizona areas to Southern California along the western side of the Colorado River.
LADWP's EOR systcm consists of two 500-kV lines transmitting power from the Navajo and Palo Verde areas to the McCullough/Marketplace/Mead area along the WECC EOR path. Thc EOR path consists of scveral EHV transmission systems that interconnect the Arizona/ew Mexico area to N evada/ Arizona area along thc castcrn sidc of thc Colorado Rivcr.
Both ofLADWP's WOR and EOR sharcs includc 468 MW of contractual rights on SCE's Palo Vcrde-Devers system. Plans are being developed at this time to construct a second Palo Verde- Devers line (PVD2) to providc grcatcr acccss to lowcr cncrgy cost opportunities in Arizona, to increase LADWP's reach to potential renewable energy sources, and to increase operational flexibility during system outagcs.
November, 2007 H-4 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Because of the interdependencies among the WOR path, the EOR path, and other competing
paths bringing power to Southern California, the capacity ratings of the WOR and EOR paths are typically operationally determined and seasonally adjusted by the use of operating nomograms. The construction of PVD2 would potentially increase the import capability into Southern California and reduce current restrictions on these paths.
The Mohave coal-fired power plant, of which LADWP has a 10% ownership share, was shut down on December 31,2005, due to a variety of emission and water supply issues. Options for this site include converting the plant to a "clean coal" technology such as the integrated gasification combined cyele (lGCC), or possibly developing solar or wind power sources in the area. In the interim, the surplus transmission capacity will be marketed on LADWP's OASIS - , and will be utilized to transport power purchased in the wholesale market.
Owens Valley Transmission Line
This is a 230-kV line transmitting power from hydro generation plants in the Owens Valley to the Los Angeles basin.
This transmission line runs near the Tehachapi area, which is home to several existing wind farm projects. LADWP is planning on developing the 120 MW Pine Tree Wind Far Project in this area, and is also planning on upgrading this line to accommodate the wind generated energy from this area. These projects are expected to be completed in late 2009.
Northwest Intertie Transmission System
This system consists two main transmission lines. The first is the :t 500-kV DC Pacific High Voltage Direct Current Intertie (PDCI) which connects Celilo, Oregon to Sylmar, California. The PDCI passes over the Nevada-Oregon border, so the PDCI is sometimes referred to as the
NOB. The second is the California-Oregon Intertie (cor), consisting of three 500-kV AC lines, connecting the Malin and Captain Jack substations in Oregon, to Lugo and Sylmar, California. This systcm of AC lincs is sometimes referred to as the Pacific AC Intcrtie (P ACI), or the COB, since in passes over the California-Oregon border.
These two systems are beneficial to both California (ineluding LADWP) and the Pacific Northwest. Many areas ofthe Pacific Northwest have colder winters, and experience higher electrical loads in the winter and lower electrical demands durng summer months. California generally experiences hotter summers and accompanying higher electrical loads in the summer months, and lower electrical loads in non-summer months. Accordingly, California can export power to Pacific Northwest during their times of need, and can import energy from the Pacific Northwest during the summer season, utilizing both the PDCI and the PACl systems. In addition
Novembcr,2007 H-5 Los Angeles Department of Water and Power 2007 Integrated Resource Plan to this synergy, California uses these lines to access to the large hydroelectric and nuelear capabilities of the Pacific Northwest, including Canadian electrical generation.
Because of the interdependencies among the POCI path, the PACT path and other competing paths bringing power to Southern California, the capacity ratings of the POCI and P ACI paths are typically operationally determined and seasonally adjusted by the use of operating nomograms. In addition to these operating nomograms, heavy usage of the transmission lines, combined with planned and unplanned events may curtail the capacity ratings of the lines or cause "congestion". In particular, the Midway-Los Banos (Path 15) portion of PAC I has experienced significant congestion and is the focus of various studies seeking congestion relief.
As mentioned, both the POCI and P ACI are used extensively to access economic hydroelectricity from the north. Adequate capacity is reserved on these lines for LADWP customer's energy needs and to provide reliability reserves. In the opposite South to North direction, LAOWP's capacity on POCI and PACI is typically sold to external users in accordance with LAOWP's OATT and policies.
Maintenance of transmission facilities is an ongoing enart involving the participation of all owners, with the actual work managed by the facility operator. As operator ofthe southern POCI station located at Sylmar, LAOWP has recently refurbished the facility, ineluding replacing mercury-arc converters with modern thyristor converters and adding new control and protection systems.
Intermountain Transmission System
This system consists of the Southern Transmission System (STS) and the Northern Transmission System (NTS). The STS is a:! 500-kY DC line transmitting power trom the Intermountain Generating Station (IGS) in Utah to the Adelanto Switching Station in Southern California. The
NTS consists of two 345-kY AC lines connecting the IGS to PacifiCorp's Mona Substation, and one 230-kY line connecting IGS to Sierra Pacific's Gonder Substation.
The STS was built to bring IGS power to LAOWP and other municipal utilities in Southern California, and is used primarily to serve native loads. The excess transmission capacities on the NTS and STS have always been in high demand, and there is continuous interest in these paths in both directions. Studies indicate that the STS may possibly be upgraded from 1920 MW to 2400 MW.
November, 2007 H-6 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Appendix I. Glossary
. \ Acronym Definition AB Assembly Bill AC Alternating Current APS Arizona Public Service Company AQMD Air Quality Management District ATC A vailable Transfer Capacity BPA Bonneville Power Authority BTU British Thermal Unit CAISO California Independent System Operator CAP Climate Action Plan CARB California Air Resources Board CD ROM Compact Disk Read Only Memory
CDWR California Department of Water District CEC California Energy Commission CLEO Commercial Lighting Offer CNG Compressed Natural Gas CO2 Carbon Dioxide COB California-Oregon Border cm California-Oregon Intertie CPUC California Public Utility Commission DC Direct Current DDR DSM, DG and Renewable Resources DG Distributed Generation DOE Department of Energy DSM Demand-Side Management
DWP Department of Water and Power EE Energy Effciency EHV Extra-High Voltage EOR East -of- the- River EPA U.S. Environmental Protection Agency ESP Energy Service Providers
November, 2007 I-I Los Angeles Department of Water and Power 2007 Intcgratcd Rcsourcc Plan
Acronym Definition EV Electric Vehicle FACTS Flexible AC Transmission System FERC Federal Energy Regulatory Commission FOR F arced Outage Ratcs FSO Financial Serviccs Organization FY(E) Fiscal Year (Ending) GHG Greenhouse Gas GS Generating Station GWh Gigawatt Hour HVDC High Voltage Direct Current HnGS Haynes Generating Station HVAC High Voltagc Alternating Current ICE Intcrnal Combustion Engine ICPA Intcrmountain Consumer's Power Association IGS Intermountain Generating Station iou Investor-Owned Utilities IPA Intermountain Power Agency IPP Intermountain Power Project IRP i ntegrated Resource Plan ISO Independent Systcm Operator kW Kilowatt LADPW Los Angeles Department of Public Works
LADWP Los Angeles Department of Water and Power LED Light Emitting Diodes LFO Load Forecasting Organization LFOP Load Forecasting Optimization Process LNG Liquefied Natural Gas LSE Load Serving Entity MMBtu Million British Thermal Units MMTC02E Million Metcric Tons CO2-Equivalent MORC Minimum Operating Reliability Critcria MW Megawatt
N ovcmbcr, 2007 1-2 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Acronym Definition MWh Megawatt Hour NBRS Neighborhood Reduction Service NEL Net Energy for Load NERC North American Electric Reliability Council NOAA National Oceanic & Atmospheric Administration NOB Nevada-Oregon Border NOx Nitrogen Oxides NPC Nevada Power Company N-S North-to-South NTS Northern Transmission System O&M Operating and Maintenance OASIS Opcn-Acccss-Samc-time-Information System OTC Operating Transfer Capacity PDCI Pacific DC Intcrtic PG&E Pacific Gas & Electric Company POD Public-owned utility PV Photovoltaic PwC PricewaterhouseCoopers LLP RECLAIM Regional Clean Air Incentives Market Program RFP Request for Proposal RPS Renewable Portfolio Standard RTC RECLAIM Trading Credits RTO Regional Transmission Organization SB Senate Bill SCADA Supervisory Control and Data Acquisition SCAQMD South Coast Air Quality Management District SCE Southern California Edison SCIT Southern California Import Transmission SCPP A Southern California Public Power Agency SCR Selective Catalytic Reduction SDG&E San Diego Gas and Electric Company SEER Seasonal Energy Efficiency Ratio
November, 2007 1-3 Los Angeles Department of Water and Power 2007 Integrated Resource Plan
Acronym Definition SoCal Southern California Gas Company SRP Salt River Project STS Southern Transmission System TEP Tucson Electric Power Company TES Thermal Energy Storage Program
UCLA University of California in Los Angeles WAPA Western Area Power Administration WECC Western Electricity Coordinating Council WOR Wcst-of-the-River WSCC Western System Coordinating Council ZEV Zero Emission Vehicle
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