New England/MEPCO – New Brunswick Area System Performance Concerns

1. New England/MEPCO – New Brunswick Area System Performance Concerns

2. Presentation Objective • 12C/15.5/Transmission Cost Allocation (TCA) major components are • Alternatives Analysis • Regulatory Incremental/Localized Cost review • This presentation is intended to make parties familiar with this project • Will be followed by formal application • Requesting funding support recommendation at 6/22 RC meeting • 6/22 action to address all 12C/15.5/TCA requirements

3. Region Characteristics • The Maritimes are synchronously connected to the Eastern Interconnection by only the 1970 vintage, wood pole construction, 150 mile long, 345 kV Orrington to Keswick Line • This path separates the two systems a little more than once a year on average due to relay action • There is a single 345 kV path from Orrington to Maine Yankee with a limited number of 115 kV parallel paths

4. Region Characteristics • Due to this electrically weak corridor, the system has had the need to add a number of prop up fixes as seen by the 8 SPS. (MY DCT*, Maxcys Cross-trip, Bucksport Over-current, Bucksport Reverse Power, 396, GCX, Loss of Export on 396, KPR (if Chester SVC is out of service)) • Maritimes - New England transfer capability is 700 MW. *The MY DCT SPS is not due to the weak corridor

5. Region Characteristics • New England - Maritimes transfer capability ranges from negative (requiring import into NE) up to around 250 MW depending on the system dispatch • Orrington South transfer capability is approximately 1,050 MW limiting economic transfers and creating an operating concern

7. New England System Concerns Summary • Consequences of large Maritime Provinces load loss resulting in system separation (reason for Keswick GCX SPS) • Keswick GCX SPS inadvertent operation and inter Area impact violation • Loss of 1200+ MW (violation of NEPOOL Loss of Source criteria) due to trips/inadvertent trips of Keswick-Orrington 345 kV (NB-NE tie Section 396), Orrington-Maxcys 345 kV (Section 388), Maxcys-Maine Yankee 345 kV (Section 392) • Loss of 396 SPS (trips Maine Independence Station) (contributes to Loss of 1200+ MW)

8. New England System Concerns Summary • Lack of fuel diversity and gas supply • Orrington south interface 1050 MW limit • Maine Yankee Double Circuit Tower outage • Central Maine Power transient voltage response • NB-NE tie losses (up to 22.5 MW saving opportunity) • Limited access of MPS/EMEC to New England resources (no direct ties or firm contract path to the New England transmission system)

9. Maritimes System Concerns Summary Consequences of large Maritimes Provinces load loss (reason for Keswick GCX SPS) The Maritimes Area desires a more secure inter-Area interconnection with New England. Maritimes Area desires a firm import capability from New England. NB-NE tie losses

10. Maritimes System Concerns Summary • New Brunswick Power is interested in improved market access between NPCC/NEPOOL and the Maritimes Control Area to support market development and seams reduction • The Maritimes are winter peaking while New England is summer peaking. Improved transfer capability would allow for better utilization of existing generation resources

11. New England System Concerns - Expanded • GCX SPS Purpose and Need • Due to the isolation (single tie) to the Maritimes, a large load loss creates surplus generation and the possibility of a trip of S396 due to load and power angle swing • GCX SPS provides controlled generation runback to prevent system split • This is supervised by frequency such that it is only armed for over frequency

12. New England System Concerns - Expanded • Numerous faults within New England have been shown to interact with the GCX SPS, often due to delayed clearing (examples of this include long clearing faults associated with the Tewksbury-Woburn 115kV line, certain contingencies associated with the Seabrook – Tewksbury 345kV line) • Improvements to the facilities involved in this inter-Area impact generally need improved protection etc. and need to meet Bulk Power System (BPS) protection criteria including redundancy

13. New England System Concerns - Expanded • Loss of source 1200+ MW (Violation of NEPOOL criteria) • Loss of S396 at full load and operation of the 396 SPS is potentially greater than 1200 MW • Section 396 is more than half the radial path between Maine Yankee and New Brunswick Power, thus more than half the exposure

14. New England System Concerns - Expanded • 396 SPS • This SPS was added when Maine Independence Station (MIS) came on line to ensure an existing system oscillation was not made worse • Trips MIS for any loss of S396

15. New England System Concerns - Expanded • Orrington South 1050 MW Interface limit • Interface limits generically reduce market flexibility and add operating complexities • Limited by the thermal rating of CMP 115kV section 86 between Bucksport and Highland • Limit originally primarily a problem for Bucksport Energy under certain transfer situations • GLHA generator addition confirmed this as a limit in part related to the Maine Yankee 375/377 Double Circuit Tower load issues

16. To Pt. Lepreau MY 377/375 DCT

17. New England System Concerns - Expanded • Maine Yankee Double Circuit Tower exclusion • Exclusion need determined when Bucksport Energy came on line due to increased transfers • Exclusion granted in 2000 by both NEPOOL and NPCC • NEPOOL significantly concerned and required an update regarding solutions other than exclusion • Became a limit in Orrington South transfers

18. New England System Concerns - Expanded • CMP proposed transient voltage sag criteria • While this criteria is yet to be approved, studies in Maine are testing against it with the intent of complying if reasonable to do so • Northeast Reliability Interconnect (NRI)* System Impact Study identified several pre-existing contingencies that do not meet this criteria *Northeast Reliability Interconnect a.k.a. 2nd NB Tie project

19. New England System Concerns - Expanded • Energy losses on S396/3001 between Orrington and Keswick • Based on the actual flows* from the years 2000 through 2002, losses on this line alone amount to over 400,000 MWHs • Average losses during this time period are over 9.4 MW • Historic flows have been greater than the period studied * Includes flows in both directions

20. MPS EMEC

21. New England System Concerns - Expanded • Areas of New England with no direct electrical connection or firm contract path to New England • Maine Public Service • Eastern Maine Electric Coop • Others • Approx. 140 MW of load • Market constrained – customers in these territories have few market/supply options and limited NEPOOL supply options

22. North East NE Issues for the Future • Orrington to MY Single 345kV line • Congestion in Maine • System losses • Removal of Bucksport SPS, DCT, other SPS • Increase Surowiec south transfer • Increase ME/NH transfer

23. Northeast Reliability Interconnect • BHE, the proponent has considered a 345 kV transmission line from Orrington to Pt. Lepreau to be the most beneficial solution to address these many concerns • The options analysis that follows illustrates that the proposed line is the only comprehensive solution • NRI is the first step in the longer run reinforcement strategy of the northern New England transmission system

24. Alternatives Under Consideration(None except NRI individually address all needs) • Upgrade NEPOOL facilities that impact GCX SPS (Maritimes Area loss of load) • Thyristor Controlled Series Comp (TCSC) in Keswick-Orrington 345 kV (Maritimes area loss of load (?), GCX (?), 396 trip, 396 SPS (?), CMP t.volt (?)) • Orrington-Maxcys 345 kV fixed series compensation* (Orrington S 1050MW (S86 thermal limit)) • Reconductor Bucksport-Highland 115 kV Section 86 (Orrington S 1050MW (S86 thermal limit)) • Western Maine capacitors* (required to increase Orrington S 1050MW with the S86 rebuild) *Part of NRI project

25. Alternatives Under Consideration(None except NRI individually address all needs) • Split MY DCT (MY DCT outage) (This combined with S86 rebuild improve Orr-S 1050MW) • MY DCT SPS to trip NB generation* (MY DCT outage and partial Orr-S 1050 limit) • MEPCO SPS redesign (CMP transient volt) (likely to occur regardless) • Northern Maine Interconnection Project – 115 kV (MPS access) • Northeast Reliability Interconnect Project (Maritimes Area Loss of load, GCX SPS, 396 trip, 396 SPS, CMP transient volt, NB-NE tie losses, improve MPS/EMEC access to markets, Orr south transfer limit, NB benefits, other NE benefits) *Part of NRI project

26. Summary of Possible Solutions * Required with the NRI 345 kV

27. Other Transmission Alternatives to theNortheast Reliability Interconnect Project • Up-rate existing Orrington to Keswick 345 kV line [$?] • Also requires Orrington-South & MY DCT reinforcements • Would increase magnitude of loss of source contingencies • Iffeasible, would likely require substantial combinations of fixed/dynamic series/shunt reactive compensation • Existing line is 35 yrs old and not able to be taken out of service • Convert existing Orrington to Keswick 345 kV Line to High Voltage DC [~$200M] • Also requires Orrington-South & Maine Yankee Double Circuit Tower reinforcements. • Would increase magnitude of loss of source contingencies • Would create a small Maritime Province asynchronous system; loss of source and load contingencies would be very problematic • Existing line is 35 yrs old and not able to be taken out of service

28. Preferred Solution • Northeast Reliability Interconnect Project as 345 kV path between Orrington and Pt. Lepreau Project Includes - • A 345kV transmission line between Orrington and Pt. Lepreau • Mechanically Switched Series Capacitor on S388 south of Orrington • 115kV Breaker upgrade at Maxcys due to short circuit currents • Shunt capacitor installation at CMP substations Gulf Island and Kimball Rd • SPS upgrades and changes

29. Benefits of Preferred Solution • Reduces impact to Maritimes and Eastern Interconnection of large Maritimes load loss – with two lines between Orrington and the Maritimes, the overload concern (hence separation of systems) that drove the need for the GCX is gone • Eliminates GCX SPS for all lines in service – reducing possibilities of inadvertant trips due to other New England contingencies • Reduces loss of source related to tripping of section 396 (1200+ MW) • Possible elimination of need for the 396 SPS for all lines in • Increases the Orrington south transfer limit to the loss of source limit of 1200MW

30. Benefits of Preferred Solution • Addresses the 377/375 DCT issue with SPS upgrades and NBP generation run back – this overload of underlying lines and enhances reliability • Improves CMP transient voltage response such that pre project violations of the proposed voltage sag criteria are addressed • Reduces MW losses on tie between Maine and Maritimes - by approx. 9.4 MW avg. based on historic transfers 00,01,02

31. Benefits of Preferred Solution • Increases ability to serve Northern Maine or to export energy to the Maritimes • NBP indicates an expectation based on studies to develop at least 50MW firm import capability from NEPOOL related to MPS/EMEC • NRI SIS suggested flows up to 400MW depending on system conditions (makes the capacity of Bucksport and MIS available on a firm basis to MPS/EMEC and Maritimes)

32. Benefits of Preferred Solution • Loss Reduction • Based only on comparison of Orr to Kes and Orr to Pt. Lepreau • Can be considered zero operating cost generation with zero emissions

33. Benefits of Preferred Solution • Strengthens a section of a very weak 345 kV path • Reduces contingencies that separate Maritimes Provinces from Eastern Interconnection • Increases Maritimes to Orrington capability from 700 MW to 1000 MW • Increase in resource capacity available to New England (Orrington South flows due to Orrington-Maxcys series compensation)

34. Benefits of Preferred Solution • Increase in energy available to New England (Orrington; S. ME with Orrington-Maxcys series comp.) • Provides NEPOOL with improved fuel diversity • Increased New England-New Brunswick transfer capability could provide opportunities for locked-in generation in Maine – especially given Maritimes winter peak • Future potential for increased sharing of ancillary services with New Brunswick

35. Summary of Benefits and Funding Justification Technical Alternatives to Reliability Solutions1 51M Additional Benefits: 1Brought forward from “Summary of Possible Solutions” slide 2From ISO-NE Congestion Study – See app.

36. Next Steps • 15.5/TCA Application at 6/22 RC meeting • Materials for 15.5/TCA to be distributed two weeks prior to meeting • Analyses to complete include 396 SPS need review, 2nd Orrington to Maine Yankee feasibility study and benefit review

37. Closing • The Northeast Reliability Interconnect is the only alternative available to address all the reliability issues described • The NRI also provides a range of economic opportunities • This line is a critical step in strengthening the northern New England transmission system • FERC has indicated that apportioning the reliability benefits of transmission projects is impractical and thus it is appropriate to socialize the cost of projects to ensure they are constructed • FERC has also noted the value of increasing transfer capability between control areas • It is important to seize the opportunity to construct transmission infrastructure as it is becoming increasingly difficult to acquire required permits • This reliability based project merits 100% regional funding support

38. Appendix

39. Loss of Load Expectation • The impact on the LOLE as a result of the NRI was assessed. It was demonstrated that an insignificant change in LOLE for New England for the base conditions that were assessed. It is possible that additional sensitivity analysis may demonstrate a more significant impact

40. Congestion Analysis • Provided by W Coste and H Wang ISO-NE • Second New Brunswick Tie: Preliminary Analysis • The following cases were run to analyze the economic benefits of the second New Brunswick tie. These results show that there are benefits to the increased transfer capabilities that the second New Brunswick tie interconnection allows, as well as other proposed and potential projects. The results are cumulative over a ten-year period based on the following case transfer assumptions and did not assess sensitivities to additional unlikely but possible changes to system conditions: • Case 9A : Same as Base Case except that the NB Gas unit increases from 500 to 800 MW • Case 9Au : Same as 9A except completely unconstrained (used for congestion)

41. Congestion Analysis • Case9A_1 : Same as 9A except (Increase in NB-NE only) NB to BHE: increased from 700 to 1000 MW Orrington South: no change Surowiec South: no change Maine New Hampshire: no change Northern New England-Scobie: Not Modeled • Case 9B: Same as 9A except (2nd NB Tie and Y-138) NB to BHE: increased from 700 to 1000 MW Orrington South: increased from 1050 to 1200 MW Surowiec South: no change Maine New Hampshire: increase from 1400 to 1500 MW Northern New England-Scobie: Not Modeled • Case 9C: Same as 9A except (2nd NB Tie, Y-138 and Orr-South Expansion) NB to BHE: increased from 700 to 1000 MW Orrington South: increased from 1050 to 9999 MW Surowiec South: no change Maine New Hampshire: increase from 1400 to 1500 MW Northern New England-Scobie: Not Modeled

42. Congestion Analysis • Case 9D: Same as 9A except (2nd NB Tie, Y-138, Orr South and Sur-South Expansion) NB to BHE: increased from 700 to 1000 MW Orrington South: increased from 1050 to 9999 MW Surowiec South: increased from 1150 to 9999 MW Maine New Hampshire: increase from 1400 to 1500 MW Northern New England-Scobie: Not Modeled • Case 9E: Same as 9A except (2nd NB Tie, Y-138, Orr South, Sur-South and MENH Expansion) NB to BHE: increased from 700 to 1000 MW Orrington South: increased from 1050 to 9999 MW Surowiec South: increased from 1050 to 9999 MW Maine New Hampshire: increase from 1400 to 1700 MW Northern New England-Scobie: Not Modeled

43. Congestion Analysis Cumulative 10 Year-Value of Transmission Improvements in Millions of Dollars