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Energy Future for Washington State

Explore the evolving energy scene in Washington State, with consultant Jim Lazar's insights on cost-effective shifts like wind, solar, and storage technologies. Discover strategies for utilities to align loads with resources and navigate changing demands. Stay informed to embrace the energy transition efficiently.

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Energy Future for Washington State

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  1. Energy Future for Washington State Jim Lazar Consulting Economist October, 2018

  2. A Bit About Jim Lazar • Consulting Economist, based in Olympia, Washington. Working in utility ratemaking since 1974. • Expert in more than 100 utility rate proceedings, primarily in the Pacific Northwest • 22 states, plus ~10 countries • Senior Advisor, The Regulatory Assistance Project (RAP).

  3. Washington Remains a Low-Cost State for Electricity

  4. Washington About Average for Natural Gas Prices

  5. But Things Are Changing Utility load growth stagnant Lower cost of wind Lower cost of solar Lower cost of storage Electric Vehicles

  6. Sources: Tracking the Sun 10, Lawrence Berkeley National Laboratory and U.S. Department of Energy SunShot program

  7. Wind Cost Per kWh (US)

  8. Solar Economics Are Improving

  9. Global Best of Class: 2015 Source: Michael Liebreich, presentation to California ISO, October 18, 2017. Data from Bloomberg New Energy Finance; images from Siemens, Wikimedia Commons, and Electrek

  10. Global Best of Class: 2016 Source: Michael Liebreich, presentation to California ISO, October 18, 2017. Data from Bloomberg New Energy Finance; images from Siemens, Wikimedia Commons, and Electrek

  11. Global Best of Class: 2017 Source: Michael Liebreich, presentation to California ISO, October 18, 2017. Data from Bloomberg New Energy Finance; images from Siemens, Wikimedia Commons, and Electrek

  12. December 2017: Xcel Bid Median Prices $/kWh

  13. Existing Power Plant Operating Costs per USEIA $37/MWh $30/MWh $25/MWh Existing Plant Average Fuel and O&M from USEIA Table 8.4 Electric Power Annual 2016

  14. Existing Plants vs. Xcel Bids $.037/kWh $37/MWh $.030/kWh $.029/kWh $30/MWh $30/MWh $.025/kWh $25/MWh $.018/kWh $18/MWh Existing Plant Average Fuel and O&M from USEIA Table 8.4 Electric Power Annual 2016

  15. Battery Costs Have Dropped

  16. Battery Costs Still Going Down

  17. NV Energy: 2018 Prices • Solar: $.024/kWh • Storage: $72/kW-Year • (Think of this as a $6/kW demand charge.)

  18. Things Can Change Quickly 5th Avenue, NYC, Easter 1900 See any automobiles? Source: Tony Seba

  19. Things Can Change Quickly Park Avenue, NYC, Easter 1913 See any horses? Source: Tony Seba

  20. Did You Have a Smartphone 15 Years Ago?

  21. Public Power Utilities Well-Situated with BPA Power

  22. PSE Will Be Severely Challenged • Highest Cost Major Utility • Rates 20% Above Public Power Average • Major resource expirations • Centralia • Colstrip ½ • Hydro Contracts

  23. Significant Need for Resources PSE has a big gap to fill!

  24. System Flexibility Is Challenged

  25. Why is this an issue? Solar helps meet daytime load. Loads still rise in the early evening. Compounded by wind coming and going.

  26. How Do Utilities Manage This Now?

  27. Hydro Helps A Lot

  28. Guess What: Ducks Can Fly A duck in water has very much the shape of the CAISO graphic. The “fat body” floats, and the tall neck breathes. A duck in flight stretches out its body and straightens its neck in order to reduce wind resistance.

  29. Ten Strategies To Align Loads to Resources(and Resources to Loads) with Illustrative Values for Each Targeted energy efficiency Peak-oriented renewables Manage water pumping Grid-integrated water heating Storage air-conditioning Rate design Electricity storage in key locations Demand response Inter-regional exchanges Retire inflexible older generating units Not every strategy will be applicable to every utility.

  30. Rate Design • Some utilities may rely more heavily on demand charges • Move to TOU Pricing • Move to Seasonal Pricing • Your Response: • Storage: Electric and Thermal • On-Site Generation

  31. What does this rate design say? $2.25 $2.75 $1.50

  32. Prices are Getting “Spikier”

  33. Sacramento Commercial Rate

  34. Demand Response Maryland: $1.25/kWh Credit

  35. Shape, Shift, Shed and Shimmy

  36. Battery Energy Storage • Utility system or Distributed • Multiple Benefits • Demand Charge Mitigation • Emergency Services • Power Quality / Ancillary Services • TOU Rate Arbitrage

  37. Tesla: PV + Battery in Puerto Rico

  38. Thermal (Air Conditioning) StorageA/C is ~30% of Peak Demand Commercial load doubles; Residential load up 4X. Option: Appliance standards Service standards Retrofit incentives

  39. We Can Store “Cool” as Ice(in fact, most of us already do)

  40. Small Buildings: Unitary Storage Air Conditioning

  41. Large Buildings:Ice or Chilled Water Storage Calmac

  42. Austin Energy:District Cooling System

  43. This Will Be And Exciting Transition.Are You Ready?

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