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Donald W. Downes Chairman, CT Department of Public Utility Control

M EETING CT E NERGY C HALLENGES. T HE C ONNECTICUT E NERGY A DVISORY B OARD. Donald W. Downes Chairman, CT Department of Public Utility Control Chairman, CT Energy Advisory Board C ONNECTICUT’S E NERGY F UTURE Legislative Office Building December 2, 2004. Fuel Prices $$. Enviro

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Donald W. Downes Chairman, CT Department of Public Utility Control

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  1. MEETING CT ENERGY CHALLENGES THECONNECTICUT ENERGYADVISORY BOARD Donald W. Downes Chairman, CT Department of Public Utility Control Chairman, CT Energy Advisory Board CONNECTICUT’S ENERGY FUTURE Legislative Office Building December 2, 2004

  2. Fuel Prices $$ Enviro Concerns $$ Feeling the Federal/Regional Energy Price Squeeze $$Two Price Zones LMP $$ (Locational Marginal Pricing) LICAP $$ LICAP $$ RMR (Locational Installed CAPacity) (Reliability-Must-Run generators)

  3. CT Transmission Problem NB BHE Impact of Deficiency HQ ME $$ - LocationalMarginal Pricing $$ - Hidden Costs Weakened Reliability Deficient VT SME Marginal NH Adequate Locked In Generation NY BOST CMA/NEMA WMA SEMA RI CT SWCT NOR Map Source: CL&P

  4. CONNECTICUT ENERGY ADVISORY BOARD CT Generation Problem $$ - LICAP (Locational Installed CAPacity) Hidden Costs - $$ Weakened Reliability Old Generation Impact of Problem Older generation units are: • near end of service life (many will be 40 yrs old or older by 2013) • inefficient – avg. efficiency is about 30% • expensive to operate • mismatched to load: baseload plants being used for Spinning Reserve Combined Cycle Gas Turbine plants • can be up to 2X as efficient

  5. l Nov 04 Source: EIA

  6. CONNECTICUT ENERGY ADVISORY BOARD CT Strategies to MeetElectric System Challenges On-going Strategies Energy Efficiency Conservation Demand/Load Response Distributed Generation Transmission Generation

  7. Getting from Here to There Infrastructure Building Phase Now Future Cost $$ Reliability Problems On-going Strategies Restraining Demand Energy Efficiency/Conservation Distributed Generation Demand/ Load Management Response CEAB Process

  8. Environmental Policy Energy Policy

  9. CONNECTICUT ENERGY ADVISORY BOARD CEAB Process Existing Challenges Integrated Resource Planning and Adequacy function -has been shifted from regulators/monopolistic structure to competitive market forces New Role for CEAB – to review/ evaluate proposed energy solutions

  10. CONNECTICUT ENERGY ADVISORY BOARD CEAB Process Goals for New Entity Primary goals for new entity – encourage competing energy solutions/provide opportunity to review multiple energy solutions simultaneously New restructured environment requires new approach

  11. CONNECTICUT ENERGY ADVISORY BOARD CEAB Process 3 Implementation Tools CEAB Preferential Criteria Energy Economics Energy Efficiency/Conservation/Demand & Load Management Response Environmental Quality of Life/ Community Interests Energy Project Solicitation Process (RFP) Reactive Solicitation Proactive Solicitation CT Energy Plan

  12. Realizing the Cost Benefits Adequate Transmission Real Costs LMP Adequate Generation Real Costs LICAP So. Maine SE MASS $ Gen. $$ TIME

  13. Environmental Policy Energy Policy Working Together for a Common Goal

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