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Block Island

Block Island. Block Island. Vermont CHP and Customer Generation Potential Study September 15 th Study Team Progress Report. Presented by: La Capra Associates, Inc. Stantec Consulting Inc. Presented to:. VSPC Study Team. September 15, 2010. Agenda.

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Block Island

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  1. Block Island Block Island Vermont CHP and Customer Generation Potential Study September 15th Study Team Progress Report Presented by: La Capra Associates, Inc. Stantec Consulting Inc. Presented to: VSPC Study Team September 15, 2010

  2. Agenda • Objectives for today’s briefing John Athas • Existing CHP/Customer Generation Dan Kelly, Jose Donnell • CHP Technology Overview Dan Kelly • CHP Potential Methodology - John Athas, Patty Richards, Barbara Stoddard, Melissa Whitten • Assumptions and Economic Testing John Athas • Summary of Issues from Discussion Patty Richards • Next Steps Patty Richards, John Athas

  3. Objectives for today’s briefing • Provide an Update of the current CHP / Customer Generation Investigations • Provide an Update on the CHP Potential including an understanding of: • Methodologies and approximations • Progress in Data Gathering • Discuss any study issues and obstacles with the VSPC Study Committee • Sub-bullet 3

  4. Existing CHP/Customer Generation • Data Gathering • Industrial Database review • Vermont Utility Survey by La Capra Team • VT PSB • Net-metering applications • Posted CHP Existing Facilities • Host Customer Electric Load Information Request? • Mapping of Locations • Summaries of Technology and Operations • Customer Phone Interviews • Economic Review

  5. Existing CHP/Customer Generation – Preliminary Tabulation

  6. CHP Technology Overview • Prime Mover Technologies to be Studied • Internal Combustion Turbine • Diesel Based Configurations • Fuel Cells • Combustion Turbine • Steam Turbine / Back Pressure Steam Turbine • Key assumptions being finalized • Available Sizes and Fuel • Electric and overall thermal efficiencies • Cost & Performance

  7. CHP Potential Methodology • Overview of analysis • Customer / Segment Characteristics • Segment Size • Electric Load • Thermal Load • Natural Gas Availability • CHP / Customer Generation Equipment Operation

  8. CHP Potential Methodology - Overview • Begins with estimation of Customer segment sizes represented by a typical customer • SIC Code – two digit • Load Zone • Fuel availability • Electric and Thermal Use Characteristics, potential for CHP and Electric to Thermal Switching such as Absorption Chilling • Various Generation technologies and sizes tested for each segment. • Analysis approximates the operation of a CHP unit based upon electric and thermal match • Lowest cost per kWh plant will be chosen

  9. CHP Potential Methodology – Electric Load Data • MWH by Zone • Statewide - EVT Data • Burlington - BED Data • Retail Sales (no distribution, transmission or sub-transmission losses) • Missing IBM 2008 and 2009 data set • Used average 2005 to 2007 for missing IBM data • Missing ~ 8% of the load data from the zone counts. • Per EVT missing data : • OMYA • Stowe Mount Mansfield Load • Unknown Loads • Will make adjustment to load zones per above

  10. CHP Potential Methodology – Electric Load Data • Customer Count by Zone •  SIC • MWH by Zone by SIC • Number of Customers by Zone by SIC • No KW… yet (EVT) • If no data produced may need “typical load” factor • Will have to back into KW

  11. CHP Potential Methodology - Sample Customer Data

  12. CHP Potential Methodology – Sample Load Zone Data

  13. CHP Potential Methodology: Estimated Thermal Load • How to obtain Thermal Load – Load not served by electricity • Sources for natural gas usage by Industry may exist: • Vermont Natural Gas: • Service territory does not include entire state • Availability: to be determined • Need total thermal load served by all fuels not just gas • Input-Output data collected annually by SIC code • Annual tables have limited detail • Benchmark years have more detail but released with a lag – latest year is 2002 • Provides metric for electric, gas, coal, and petroleum used to produce each industry’s output.

  14. CHP Potential Methodology: Estimated Thermal Load • Input – Output Table: Bureau of Economic Analysis (BEA) • Provides value of fuel used as a share of output • Correspondence to 4-digit SIC code level detail (*) • Paper Mills (SIC 26): for every $1.00 of output produced: • Electricity: 3 cents Natural Gas: 2.7 cents • Algorithm to Estimate Electric to Total Thermal Load: • Relative fuel prices to electric prices for Benchmark Year 2002 • Developed algorithm to estimate Electric to Total Thermal Load • Combined ratio of each fuel’s share of output to electricity’s value – in algebraically correct manner • * Fuel price ($/ mmBtu ) divided by Electricity price ($/mmBtu) • Apply to EVT, et al, kWh by SIC to obtain Thermal Load for use as input to Customer Economic Model.

  15. Historical Price by Fuel Type: create price ratios

  16. Example: Thermal Load Estimation for one SIC

  17. Customer Segment Characteristics • Electric Peak Demand Estimation • Split of High Quality (e.g. Steam) and Low Quality (e.g. Hot Water) Thermal Usage • Capture Existing Fuels used for Thermal Energy Production • Allowance for Thermal Use Characteristics • Thermal Match Factor (reduces customer thermal) • Thermal Requirement Split (reduces hours of CHP operation) • CHP Unit Assumptions • Sizes Evaluated – Max Customer Peak, Minimum based on Load factor • Units Operate whenever Thermal output is utilized on-site • Excess sold at Market Prices to grid CHP Potential Methodology: CHP Operation 17

  18. CHP Potential Methodology: Potential Definitions • Technical Potential • Generation Plant Sized ‘optimally’ for each segment • Customer Thermal Load dependent • Will not include creation of aggregated thermal loops such as district heating and cooling • Segment CHP Cost of Electricity • Net Cost of Electricity for the “Technical Potential” Blocks • Economic Potential • Sizes Evaluated – Max Customer Peak, Minimum based on Load factor • Units Operate whenever Thermal output is utilized on-site • Excess sold at Market Prices to grid 18

  19. Assumptions and Economic Testing • Assumptions • EVT Assumptions • Cost of Money • Discount rate • Avoided Costs • Escalation Rates • ‘Core’ Fuel Price • Externality ‘costs’ of emissions • Electric Utility Rates – specific local utility

  20. Assumptions and Economic Testing • Economic Testing • Net Cost of Electricity • Host Customer Economics – value based upon electric rates and market prices • 20 year NPV, Simple Payback, Internal Rate of Return • Electric Utility Resource Economics – value based on market prices for energy and capacity, avoided distribution and transmission • Societal Test, Total Resource Cost Test, Utility Cost Test

  21. Economic Testing – Net Cost of Electricity Thermal Credit CHP Fuel Net Cost of Electricity O&M Capital

  22. Summary of Issues from Discussion Existing CHP Customer Data Methodology 22

  23. Next Steps 23 23

  24.    Thank you One Washington Mall, 9th Floor Boston, MA 02108 www.lacapra.com 617-778-5515 Contact Information: 277 Blair Park Suite 210 Williston, VT 05495 802-861-1617 or 802-861-1618 John Athas jathas@lacapra.com

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