HomeMy WebLinkAbout2020-08-20; Clean Energy Alliance JPA; ; Clean Energy Alliance 2020 Integrated Resource PlanClean Energy Alliance
JOINT POWERS AUTHORITY
Staff Report
DATE: August 20, 2020
TO: Clean Energy Alliance Board of Directors
FROM: Barbara Boswell, Interim Chief Executive Officer
ITEM 3: Clean Energy Alliance 2020 Integrated Resource Plan
RECOMMENDATION:
Adopt Resolution approving 2020 Clean Energy Alliance Integrated Resource Plan.
BACKGROUND AND DISCUSSION:
At its Special Meeting July 23, 2020, the Clean Energy Alliance (CEA), the Board received a presentation
regarding the Integrated Resource Plan (IRP).
The CEA Joint Power Authority Agreement Section 6.3 directs that the Authority "shall cause to be
prepared an Integrated Resource Plan in accordance with California Public Utilities Commission
regulations, and consistent with California Public Utilities Commission regulations..." Public Utilities Code
Section 454.52 requires all California Public Utilities Commission (CPUC) load serving entities, including
community choice aggregation (CCA) programs file an Integrated Resource Plan (IRP) with the CPUC
every two years. The IRP looks out at a 10-year horizon and looks at the procurement plan to meet the
state's goals of reducing greenhouse gas (GHG) emissions by 40% from 1990 levels by 2030 and 60%
renewable energy resources by December 31, 2030.
Section 454.52(b)(3) further requires that the IRP of a CCA be submitted to its governing board for
approval and shall achieve the following:
(A) Economic, reliability, environmental, security, and other benefits and performance
characteristics that are consistent with the goals of achieving 40% reduction in GHG emissions from 1990
levels by 2030 and procure 60% renewable energy resources by December 31, 2030.
(B) A diversified procurement portfolio consisting of both short-term and long-term electricity
and electricity-related and demand reduction products.
(C) Resource Adequacy requirements.
The 2020 IRP filing is prepared using the California Public Utilities Commission (CPUC) provided
Narrative Template, Resource Data Template, and the Clean Power Supply System Calculator. Two plans
are required to be filed in 2020, consistent with a statewide GHG emission limit for the electric sector
for 2030 of 46 MMT and a lower limit of 38 MMT.
The 2030 GHG benchmarks based on the GHG emissions limit are as follows:
Aug. 20, 2020
Item #3 Iterpge@g2 6v4g
August 20, 2020
Integrated Resource Plan
Page 2 of 3
LSE Proportion 2030 , Proportion 2030 GHG 2030 GHG
of 2030 Load of 2030 emissions emissions
emissions (GWh) Load benchmark benchmark
inclusive of within (MMT) —46 (MMT) 38
industrial IOU MMT MMT
load* Territory scenario scenario
SDG&E Area
Bundled 5,366 29.46% 1.198 0.990
Direct Access 3,940 21.63% 0.880 0.727
Clean Energy Alliance 8.84% 992 5.45% 0.222 0.183
Solana Energy Affiance 0 0.00% 0.000 0.000
San Diego Community Power 7,914 43.45% 1.768 1.460
Assumptions for CEA's IRP include a renewable energy portfolio target of 50% at launch increasing to
100% by 2035, diversity in planned generation mix (solar, wind, natural gas, battery storage, etc) for
energy and resource adequacy, assumptions regarding new buildout vs. use of existing resources and
geographic regions for planned resources.
The state provides its assumptions related to the types of new resources that will be needed to meet
the state's goals as shown below:
Cumulative buildout of new resources
25,000
20,000
15,000
10,000
5,000
• shed DR
• Pumped Storage
• Battery Storage
Solar
Wind 00S New Tx
Wind Selected Resource Capacity (MW)
-5,009 2020 2021 2022 2023 2024 2026 2030 Gas Capacity Not
Retained
Aug. 20, 2020
Item #3 I tell ge@q
August 20, 2020
Integrated Resource Plan
Page 3 of 3
120,000
100,000
80,000
2
60,000
a.
-a -42
40,000
C
20,000
Cumulative Resources
2020 2021 2022 2023 2024 2026 2030
• Shed DR
s Pumped Storage
• Battery Storage
Customer Solar
Solar
Wind 00$ New Tx
s Wind
• Geothermal
Biomass
Hydro (Small)
• Hydro (large)
ri Hydro (NW scheduled
imports)
al Gas
• CHP
Nuclear
4011=Mill•••••
1111111•111M11
The IRP will be submitted to the CPUC by the due date of September 1, 2020.
FISCAL IMPACT
There is no fiscal impact associated with this item.
ATTACHMENT
Attachment A - Resolution Approving Clean Energy Alliance Integrated Resource Plan
Attachment B — Clean Energy Alliance Integrated Resource Plan
Aug. 20, 2020 Item #3 I terp de@gs ofqg
RESOLUTION NO. 2020-004
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CLEAN ENERGY
ALLIANCE APPROVING AN INTEGRATED RESOURCE PLAN
WHEREAS, Community Choice Aggregation (CCA), authorized by Assembly Bill 117, is a state
law that allows cities, counties and other authorized entities to aggregate electricity demand within
their jurisdictions in order to purchase and/or generate alternative energy supplies for residents
and businesses within their jurisdiction while maintaining the existing electricity provider for
transmission and distribution services; and
WHEREAS, Senate Bill 350, approved October 7, 2015, establishes a requirement for
Community Choice Aggregation Programs to develop an Integrated Resource Plan and submit it to
the California Public Utilities Commission for certification; and
WHEREAS, Clean Energy Alliance's Integrated Resource Plan was developed consistent with
the requirements as established by the California Public Utilities Commission.
NOW, THEREFORE, BE IT RESOLVED, BY THE BOARD OF DIRECTORS OF THE CLEAN ENERGY
ALLIANCE, AS FOLLOWS:
SECTION 1. That based upon and in consideration of staff reports, presentations, public
testimony and comment, and such other matters presented to the Board of Directors during the
public meeting on this matter, the Board of Directors finds and declares the foregoing recitals to
be true and correct and incorporates the same as substantive findings herein.
SECTION 2. That the Integrated Resource Plan for CEA has been developed in
compliance with SB 350 and California Public Utilities Commission direction and is hereby
approved.
SECTION 3. That the Board Secretary shall certify to the adoption of this Resolution, and
it shall become effective immediately upon adoption.
PASSED, APPROVED and ADOPTED this 20th day of August 2020 by the following vote:
AYES: Haviland, Becker, Schumacher.
NOES: None.
ABSTAIN: None.
ABSENT: None.
ATTEST: APPROVED:
for
Sheil Cobian, Board Secretary Ellen Haviland, Chair
Template updated by Commission on June 15, 2020 Attachment B
Standard LSE Plan
CLEAN ENERGY ALLIANCE
2020 INTEGRATED RESOURCE PLAN
SEPTEMBER 1, 2020
Aug. 20, 2020 Item 3 Attachment
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Table of Contents
I. Executive Summary 2
II. Study Design 7
a. Objectives 7
b. Methodology 8
i. Modeling Tool(s) 8
ii. Modeling Approach 9
III. Study Results 11
a. Conforming and Alternative Portfolios 11
b. Preferred Conforming Portfolios 15
c. GHG Emissions Results 20
d. Local Air Pollutant Minimization and Disadvantaged Communities 20
i. Local Air Pollutants 20
ii. Focus on Disadvantaged Communities 20
e. Cost and Rate Analysis 21
f. System Reliability Analysis 21
g. Hydro Generation Risk Management 25
h. Long-Duration Storage Development 26
i. Out-of-State Wind Development 26
j. Transmission Development 27
IV. Action Plan 28
a. Proposed Activities 28
b. Procurement Activities 28
c. Potential Barriers 29
d. Commission Direction or Actions 29
e. Diablo Canyon Power Plant Replacement 30
V. Lessons Learned 30
Glossary of Terms 32
1
Aug. 20, 2020 Item 3 Attachment Item #3 Iterpge@g7 ofm41
Introduction and Executive Summary
a. Introduction
Description of CEA
Clean Energy Alliance is a Joint Powers Authority ("JPA") formed by the communities of
Carlsbad, Del Mar and Solana Beach in November 2019.
As a JPA CEA is a local government agency. CEA is governed by a three-member board
composed of representatives of its member local governments. Through these representatives
CEA is controlled by and accountable to the communities CEA serves.
CEA plans to provide retail electric generation services and complementary energy programs to
customers within the municipal boundaries of the following communities:
• City Carlsbad
• City of Del Mar
• City of Solana Beach
CEA plans to begin serving load in May 2021, with and anticipated customer base of
approximately 51,000 residential accounts and 8,000 commercial and industrial accounts. The
Solana Energy Alliance is an existing CCA program serving the City of Solana Beach, and the
customers currently served by the Solana Energy Alliance are planned to be transferred to
service by CEA in May 2021. As directed by the Commission, CEA's integrated resource plan
includes the loads and resources associated with the existing Solana Energy Alliance CCA
program.
CEA's Mission
CEA was formed for the express purpose of empowering its member communities to choose
the generation resources that reflect their specific values and needs. CEA's purpose is to be an
energy services provider, which benefits the community through the delivery of cleaner and
more locally produced electricity, demand reduction, economic investment and competitive
rates for residents, businesses, and municipal facilities in the service territory.
Consistent with Public Utilities Code Sections 366.2(a)(5) and 454.52 (b)(3),' all procurement by
CEA, including the portfolios set forth in this IRP, must comply with policy direction provided by
CEA's governing board.
1
All further citations to statute are to the California Public Utilities Code unless otherwise noted.
2
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Introduction to CEA's IRP
In accordance with the requirements of California Public Utilities Code Sections 454.51 and
454.52 and Commission Decisions ("D.") 20-03-028, D.19-11-016, D.18-02-018, D.19-04-040,
and formal guidance provided by the Commission's Energy Division, CEA is providing its load
serving entity ("LSE") -specific Integrated Resource Plan ("IRP") to the Commission for
certification review and use in the Commission's statewide planning process. In addition to this
narrative, CEA's IRP includes the following documents:
• CEA's 38 MMT Resource Data Template
• CEA's 46 MMT Resource Data Template
• CEA's 38 MMT Clean System Power Calculator
• CEA's 46 MMT Clean System Power Calculator
As directed in D.20-03-028, CEA is submitting two conforming portfolios in this IRP, one based
on the Commission's 46 MMT greenhouse gas (GHG) reduction benchmark and associated 38
MMT reference system portfolio ("RSP"), and a second based on the Commission's 46 MMT
benchmark and RSP.
As demonstrated by the significant differences between the Commission's 2017-2018 RSP and
its 2019-2020 RSP, projecting resource need over the time horizon covered by the IRP is an
inexact matter. Further, CEA is a new entity currently focused primarily on activities leading to
the successful launch of the program in 2021. The future resources identified in CEA's IRP
represent CEA's best good-faith projection of the resource mix that it will procure over the IRP
planning horizon, based on the best information currently available. The resources identified in
future iterations of CEA's IRP may change due to new information and changed circumstances,
and the ultimate resource mix that CEA actually procures may differ from what is reflected in
the plan due to a number of variables including availability of supply, price of supply and/or
other market or regulatory considerations.
Board Approval of IRP
In compliance with Public Utilities Code Section 454.52(b)(3), this IRP was formally submitted to
CEA's governing board for approval based on the IRPs compliance with Sections 454.51 and
454.52 (the "IRP Statute") and all relevant board-adopted procurement requirements CEA's
governing board. On August 20, 2020 CEA's board issued Resolution [Resolution
name/number] which formally approves this IRP, and adopts CEA's 46 MMT Preferred
Conforming Portfolio ("46 MMT PCP") and its 38 MMT Preferred Conforming Portfolio ("38
3
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MMT PCP"). In [Resolution name/ number] CEA's board also makes the following
determinations regarding CEA's Preferred Conforming Portfolios ("PCPs"):
• CEA's PCPs achieves economic, reliability, environmental, security, and other
benefits and performance characteristics that are consistent with the goals set
forth in Section 454.52(a)(1)(A-I).
• CEA's PCPs includes a diversified procurement portfolio consisting of both short-
term and long-term electricity and electricity-related and demand reduction
products.
• CEA's PCPs achieves the resource adequacy requirements established pursuant
to Public Utilities Code Section 380.
• CEA's PCPs are consistent with the procurement timing, resource mix, and
operational attributes of both the Commission's 38 MMT RSP and the
Commission's 46 MMT RSP.
• CEA's PCPs are fully compliant with all CEA board-adopted procurement
directives.
A copy of [Resolution name/number] is attached to this IRP Narrative and is identified as
Attachment [#].
Request for Certification
CEA respectfully requests that the Commission certify this IRP.
As both the Legislature and the Commission have recognized, The Legislature has granted CCAs
broad authority to procure resources on their customers' behalf, an authority limited only
where "other generation procurement arrangements have been expressly authorized by
statute."' Likewise, the Legislature has granted CCAs autonomy in setting their own rates and
managing interactions with their customers.3 The Commission has three primary interests the
CCA IRP process:
• Ensuring that CCA IRPs provide the CCA procurement information that the
Commission needs in order to develop its statewide plan.4
2
Public Utilities Code Section 366.2(a)(5).
3
[add].
4
[add].
4
Aug. 20, 2020 Item 3 Attachment
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iterialFelo {inn
• Ensuring that CCAs' current and planned procurement is consistent with the
resource adequacy ("RA") requirements established pursuant to Public Utilities Code
Section 380.5
• Ensuring that CCAs' current and planned procurement satisfies the CCA's share of
renewables integration resource identified in the Commission's Reference System
Portfolio ("RSP"), and that the CCA either self-provides or pays for IOU procurement
for its share of any renewable integration shortfal1.6
CEA has prepared its IRP with these interests in mind, and thanks the Commission in advance
for its recognition of CCA procurement autonomy and the benefits of a collaborative approach
with CCAs in its certification review of CEA's IRP.
b. Executive Summary
This narrative provides a detailed description of the development and content of CEA's PCPs,
each portfolio's compliance with applicable requirements, and an action plan detailing CEA's
planned next steps.
CEA developed its IRP through the following steps:
• CEA compiled data for its existing energy contracts, Resource Adequacy ("RA") capacity
contracts, and its share of capacity for allocated Cost Allocation Mechanism ("CAM")
resources.
• For each IRP planning year, CEA identified its short positions relative to CEA planning
targets in consideration of its assigned load forecast.
• CEA populated the Resource Data Template with all current contracts.
• CEA compiled detailed information on projects for which it is currently negotiating
power purchase agreements, including information regarding project status and timing.
• CEA identified future contracts it expects for new solar, storage, and wind generation.
CEA prioritized the selection of future resources that ensure CEA's overall portfolio of
new resources is consistent with the relevant Reference System Portfolio's resource
attribute/category mix,' procurement timing, and CEA's proportional share of planned
new procurement.
• CEA added generic future contracts with existing resources to help fill its remaining
open positions.
5
Section 454.52(b)(3)(C).
6 Section 454.51.
7
5
Aug. 20, 2020
Item 3 Attachment Item #3 Iteplay&gel1or48
• CEA used the Commission's Clean System Power Calculator Tool to check the GHG
emissions associated with the resulting portfolio to ensure that these emissions are
equivalent to CEA's assigned share of the 38 MMT benchmark; CEA added planned
purchases of large hydro-electric energy in sufficient volume to ensure that portfolio
emissions were equal to or below CEA's assigned share of the 38 MMT GHG benchmark
• CEA identified the resulting portfolio as its 38 MMT PCP
• Using the 38 MMT PCP as a starting point, CEA replaced planned large hydro-electric
and renewable energy procurement with system power until the portfolio had
emissions equal to the CEA assigned share of the 46 MMT GHG benchmark.
• CEA identified the resulting portfolio as its 46 MMT PCP.
• CEA checked both its 38 MMT PCP and its 46 MMT PCP for reliability by comparing the
total portfolio net qualifying capacity against CEA's RA requirements for the month of
September in each year of the planning period. CEA further established that its planned
incremental capacity exceeds its pro rata share of capacity that may be needed for
replacement of Diablo Canyon.
CEA reached the following findings regarding its 38 MMT PCP:
• CEA's 38 MMT portfolio includes the procurement of the following new resources:
o New hybrid resources totaling 150 MW solar/ 75 MW battery storage
o New wind resources totaling 75 MW
o New long duration storage of 7 MW
• CEA's 38 MMT portfolio provides for the following overall resource mix in 2030:
o 13 MW of large hydro
o 107 MW of Wind
o 200 MW of Solar
o 75 MW of Short Duration Battery Storage
• 7 MW of Long Duration Storage
o 117 MW of Natural Gas/Other (capacity-only)
• CEA's 38 MMT portfolio is consistent with procurement timing, resource quantities, and
general resource attributes identified in the 38 MMT RSP.
• CEA's 38 MMT portfolio would have 2030 emissions of 0.151 MMT. This is slightly
below CEA's assigned share of 2030 emissions, 0.152 MMT.
• CEA's 38 MMT portfolio meets all relevant reliability metrics.
• CEA's 38 MMT portfolio provides more than CEA's load-proportional share of renewable
integration resources.
CEA reached the following findings regarding its 46 MMT portfolio:
6
Aug. 20, 2020 Item 3 Attachment Item #3 iteplaypie1r4ig
• CEA's 46 MMT portfolio includes the procurement of the following new resources:
o New hybrid resources totaling 150 MW solar/ 75 MW battery storage
o New wind resources totaling 75 MW
o New long duration storage of 7 MW
• CEA's 46 MMT portfolio provides for the following overall resource mix in 2030:
o 94 MW of Wind
o 180 MW of Solar
o 75 MW of Short Duration Battery Storage
o 7 MW of Long Duration Storage
o 117 MW of Natural Gas/Other (capacity-only)
• CEA's 46 MMT portfolio conforms to the procurement timing, resource quantities, and
general resource attributes identified in the 46 MMT RSP.
• CEA's 46 MMT portfolio would have 2030 emissions of 0.189 MMT. This is equivalent to
CEA's assigned share of 2030 emissions, 0.189 MMT.
To implement its PCPs, CEA is adopting the action plan described in section IV, below. This
action plan consists of the following steps:
• CEA will periodically solicit offers for new renewable generation and storage projects.
These resources are typically secured through long term power purchase agreements.
CEA expects to secure power purchase agreements for new projects in multiple
solicitations conducted over the next several years.
• Periodically throughout the year, CEA will solicit offers for short term renewable energy,
resource adequacy, system energy, and other products needed to balance the portfolio
and adhere to position limits established through CEA's risk management policy and
practices. These solicitations can take the form of formal request for offers processes,
bilateral discussions, and transactions arranged through broker markets.
II. Study Design
a. Objectives
CEA had the following objectives in performing the analytical work to develop its IRP:
1. Identify a 38 MMT portfolio with emissions equal to CEA's proportional share of the 38
MMT GHG reduction benchmark, as determined using the Commission's emissions
calculator.
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Item 3 Attachment Item #3 iteplatFeagenpfto
2. Identify a 46 MMT portfolio with emissions equal to CEA's proportional share of the 46
MMT GHG reduction benchmark, as determined using the Commission's emissions
calculator.
3. Identify 38 and 46 MMT portfolios that achieve economic, reliability, environmental,
security, and other benefits and performance characteristics that are consistent with
the goals set forth in Section 454.52(a)(1)(A-I).
4. Identify diverse and balanced 38 and 46 MMT portfolios that include both short-term
and long-term electricity and electricity-related and demand reduction products.
5. Identify portfolios that achieve the resource adequacy requirements established
pursuant to Public Utilities Code Section 380 and fully provide CEA's share of system
reliability and renewable integration resources.
6. Identify portfolios that fully comply with all CEA board-adopted procurement directives.
7. Identify portfolios that are fully compliant with CEA's obligations under the Renewable
Portfolio Standard program.
8. Identify portfolios that are cost-effective and minimize rate impacts on CEA's customers.
b. Methodology
Modeling Tool(s)
In developing its planned portfolios CEA uses modeling tools that quantify portfolio targets for
renewable energy content, capacity, and portfolio GHG emissions, as well as physical and
financial positions to ensure adherence to sound risk management business practices. CEA uses
proprietary models to assess annual, monthly, and hourly open positions taking account of
forecast hourly electric loads and expected deliveries from CEA's resource portfolio. CEA uses a
proprietary financial model to project power supply costs and incorporate existing and planned
procurement into an overall financial assessment of revenues, costs, and cash flows. CEA also
utilities a commercially available energy trading and risk management system to monitor
positions, market exposure, credit exposure, value-at-risk, and other risk management metrics.'
8 CEA Solutions TRMTracker SaaS
8
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For new resource selection, CEA relied upon the modeling and assumptions in the Reference
System Portfolio as well as CEA's recent procurement experience which provides insight into
resource availability and cost. The mix of new resources selected in the RSP is similar to the mix
CEA would select based on its procurement experience.
GHG emissions were assessed using the Commission's Clean System Power tool for the 38 MMT
and 46 MMT variations.
Modeling Approach
Load Forecast
CEA developed its IRP using its assigned load forecast from Attachment A to the May 20, 2020
Administrative Law Judge's Ruling Correcting April 15, 2020 Ruling Finalizing Load Forecasts and
Greenhouse Gas Benchmarks for Individual 2020 Integrated Resource Plan Filings ("Load
Forecast Ruling"). As instructed by the Commission, CEA's integrated resource plan includes the
existing contracts and the 2020 loads of the Solana Energy Alliance. CEA's assigned load
forecast, including Solana Energy Alliances 2020 assigned load forecast, is as follows:
Table 1: CEA's 2020-2030 Load Forecast
Year Load Forecast (GWh)
2020 58
2021 144
2022 929
2023 927
2024 929
2025 933
2026 938
2027 946
2028 953
2029 960
2030 968
Load Shape
In developing its portfolio CEA used the default load shape from the Clean System Power
Calculator, which reflects the CAISO hourly system average load shape forecast for the 2019
IEPR Mid Baseline Mid AAEE case.
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The use of this load shape does not change CEA's total annual energy volumes for both load
and load modifiers, and these energy volumes remain consistent with CEA's assigned load
forecast.
Load-Proportional GHG Emissions Benchmark
CEA assessed its modeling against its 2030 load-proportional share of the respective 38 MMT
and 46 MMT benchmarks, as specified in the 38 MMT and 46 MMT Clean System Power tools.
CEA understands these values to be consistent with the benchmarks assigned in Table 1 of the
Load Forecast Ruling, with adjustment for certain allocated emissions as reflected in the Clean
System Power tools:9
Table 2: CEA's Assigned Shares of GHG Reduction Benchmarks
2030 Load (GWH) Proportion of 2030
Load Within IOU
Territory
2030 GHG Benchmark
(MMT) —46 MMT
Scenario
2030 GHG
Benchmark (MMT) —
38 MMT Scenario
1,141 5.3% 0.189 0.152
Compiling Existing Resources
To populate its baseline resource templates, CEA added existing resources from the following
sources:
• Energy Contracts.
• Capacity (Resource Adequacy) Contracts.
• CEA's assigned share of capacity for CAM resources, taken from the most recent year-
ahead CAM resource list available on the Commission's Resource Adequacy Compliance
Materials webpage.
Selecting New Resources
To identify its new resource procurement, CEA first determined the new resource capacity it
intends to add each year, in consideration of resource need (open positions), long-term
renewable contracting requirements, renewable portfolio standards, resource adequacy
requirements, the need for incremental resource adequacy capacity to contribute to system
reliability and renewable integration needs, the potential for technological improvements, and
financial considerations. CEA selected resource types based on its experience with competitive
9
Load Forecast Ruling at 5-7 (Table 1).
10
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solicitations for new renewable and storage resources as well as by making reference to the
studies and modeling underlying the adopted Reference System Portfolios.
Confirming Reliability
CEA's portfolios were evaluated to ensure that sufficient dependable capacity (net qualifying
capacity) is available to meet peak load requirements plus a 15% reserve margin. CEA used
technology specific Effective Load Carrying Capacity ("ELCC") factors provided by the
Commission to assess the contribution of each resource to system reliability. CEA's portfolios
were designed to ensure that current incremental resource adequacy capacity obligations are
met and that CEA contributes to new resource development to address fossil fuel retirements
and decommissioning of the Diablo Canyon nuclear power plant.
Calculating GHG Emissions
CEA calculated the emissions associated with its 38 MMT PCP and its 46 MMT PCP using the
Commission's Clean System Power calculator tool. The assigned load forecast and default load
shapes and behind the meter adjustments were used for this assessment, along with the
planned supply portfolios. The results were checked against the assigned GHG benchmarks
included in the Clean System Power tools.
III. Study Results
a. Conforming and Alternative Portfolios
As required by the Commission, CEA is submitting two conforming portfolios — a 38 MMT PCP
that conforms to the Commission's 38 MMT RSP and a 46 MMT PCP that conforms to the
Commission's 46 MMT RSP. CEA is not submitting alternative portfolios.
CEA's 38 MMT PCP
The table included as Attachment B to this Narrative provides a summary of CEA's 2030 38
MMT Portfolio, identifying resources by type and distinguishing between the following
procurement categories:
• Existing resources (energy and capacity) that CEA owns or contracts with, consistent
with definitions provided in the Resource Data Template.
• Existing resources (energy and capacity) that CEA plans to contract with in the future.
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• Existing resources (capacity) that CEA partially pays for through CAM.
• New Resources (energy and capacity) that are under development that CEA is planning
to procure.
• Future new resources (energy and capacity) that CEA is planning to procure.
In summary, to meet CEA's projected 2030 energy demand of 968 GWh, CEA has selected a
2030 38 MMT PCP composed primarily of the following resources:
• Existing solar (planned procurement) — 50 MW.
• Existing wind (planned procurement) — 32 MW
• Existing hydro (planned procurement) — 13 MW
• New solar (future resources) — 150 MW
• New wind (future resources) - 75 MW
• New short duration storage (future resources) — 75 MW
• New long duration storage (future resources) — 7 MW
Additionally, CEA's 2030 38 MMT PCP includes capacity-only resources composed primarily of
the following resources:
• CAM, Demand Response and Energy Efficiency Allocations — 45 MW
• Existing natural gas and other (planned procurement) - 72 MW
CEA's portfolio includes a mix of existing and new resources. Approximately 225 MW of CEA's
2030 portfolio is composed of new resources, reflecting CEA's role as an active player in the
State's development of new renewable and storage resources.
CEA's 38 MMT PCP Is Consistent With The 38 MMT RSP
The new resources included in CEA's 38 MMT PCP are consistent with the 38 MMT RSP's 2030
new resource mix. Under D.20-03-028, "LSEs are not required to adhere directly to the exact
proportion of resources selected by RESOLVE in the 46 MMT or 38 MMT portfolios, in
developing their own portfolios" and "specific resources may be used as proxies for similar
resources."1° The Decision requires that LSEs procure resources in four broad categories
defined by their attributes: long-duration storage (8-12 hours); short-duration storage (4 hours
or less); hybrid resources; and other resources."
As demonstrated in the following table, CEA's 38 MMT portfolio is generally consistent with
CEA's proportional share of new procurement for each of the four "resource types" identified in
D.20-03-028:
10 D.20-03-028 at 63
11 Id.
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Table 3: 38 MMT PCP New Resource Procurement by Resource Type Compared to
38 MMT RSP
Resource Type 38 MMT RSP New
Resources12
CEA Load-
Proportional Share
of 38 MMT RSP New
Resources
CEA's 38 MMT
Portfolio
Long-Duration Storage 1,605 MW 7 7
Short Duration Storage (4
hours or less)
9,714 MW 41 75
Renewable Resources 20,274 85 225
Hybrid Resources13 0 MW o
Other Resources 222 1 o
The differences between CEA's raw proportional share of the 38 MMT RSP New Resources and
the resources amounts in CEA's 38 MMT Portfolio reflect CEA's planned contributions to new
resource development during this planning period. In particular, CEA plans to add significant
new renewable generation and storage capacity to help reduce reliance on fossil fueled
generation, while minimizing GHG emissions and maintaining reliability. As compared to the
RSP, CEA's 38 MMT PCP includes more renewable energy and more short and long duration
storage which helps contribute to system reliability and renewable resource integration.
CEA's 46 MMT PCP
The table included as Attachment B to this Narrative provides a summary of CEA's 2030 46
MMT PCP, identifying resources by type and distinguishing between the following procurement
categories:
• Existing resources (energy and capacity) that CEA owns or contracts with, consistent
with definitions provided in the Resource Data Template.
• Existing resources (energy and capacity) that CEA plans to contract with in the future.
• Existing resources (capacity) that CEA partially pays for through CAM.
• New Resources (energy and capacity) that are under development that CEA is planning
to procure.
• Future new resources (energy and capacity) that CEA is planning to procure.
12 D.20-03-028 at 46 (Table 8).
13 CEA interprets the category "hybrid resources" as including generation resources that are
capable of reliably dispatching to meet late-afternoon peak load. This would include biogas generation,
combined solar and storage, and geothermal.
13
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In summary, to meet CEA's projected 2030 load of 968 GWh, CEA has selected a 2030 46 MMT
PCP composed primarily of the following resources:
• Existing solar (planned procurement) — 30 MW.
• Existing wind (planned procurement) — 19 MW
• New solar (future resources) — 150 MW
• New wind (future resources) - 75 MW
• New short duration storage (future resources) — 75 MW
• New long duration storage (future resources) — 7 MW
Additionally, CEA's 2030 38 MMT PCP includes capacity-only resources composed primarily of
the following resources:
• CAM, Demand Response and Energy Efficiency Allocations — 45 MW
• Existing natural gas and other (planned procurement) - 72 MW
CEA's portfolio includes a mix of existing and new resources. Approximately 225 MW of CEA's
2030 portfolio is composed of new resources, reflecting CEA's role as an active player in the
State's development of new renewable and storage resources.
As demonstrated in the following table, CEA's 46 MMT PCP is generally consistent with CEA's
proportional share of new procurement for each of the four "resource types" identified in D.20-
03-028:
Table 4: 46 MMT PCP New Resource Procurement by Resource Type Compared to
46 MMT RSP
Resource Type 46 MMT RSP New
Resources14
CEA Proportional
Share of 46 MMT
RSP New Resources
CEA's 46 MMT PCP
Long-Duration Storage 973 MW 4 7
Short Duration Storage (4
hours or less)
8,873 MW 37 75
Renewable Resources 14,460 61 225
Hybrid Resources15 0 MW o o
Other Resources 222 MW 1 o
14 D.20-03-028 at 41 (Table 5).
15 CEA interprets the category "hybrid resources" as including generation resources that are
capable of reliably dispatching to meet late-afternoon peak load. This would include biogas generation,
combined solar and storage, and geothermal.
14
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The differences between CEA's raw proportional share of the 46 MMT RSP New Resources and
the resources amounts in CEA's 46 MMT PCP reflect CEA's planned contributions to new
resource development during this planning period. In particular, CEA plans to add significant
new renewable generation and storage capacity to help reduce reliance on fossil fueled
generation, while minimizing GHG emissions and maintaining reliability. As compared to the
RSP, CEA's 46 MMT PCP includes more renewable energy and more short and long duration
storage which helps contribute to system reliability and renewable resource integration.
b. Preferred Conforming Portfolios
38 MMT PCP
As demonstrated in Appendix A, CEA's 38 MMT PCP consists of a combination of:
• Utility-Scale Solar
• In-State Wind
• Large Hydro
• Short-Duration Storage
• Long-Duration Storage
• Natural Gas/Other (capacity only)
As stated above, in accordance with Section 454.51(b)(3), CEA's governing board has
determined that the resource mix in its PCP achieves "economic, reliability, environmental,
security, and other benefits and performance characteristics that are consistent with the goals
set forth in [Section] 454.51(a)(1)]." These benefits and characteristics are discussed as follows.
GHG Reduction Goals
CEA's 38 MMT PCP achieves results and performance characteristics consistent with the Section
454.52(a)(1)(A) goal of meeting the Commission's 38 MMT GHG reduction benchmark. The
2030 emissions from CEA's 38 MMT PCP are slightly lower than CEA's load-proportional share
of the 38 MMT emissions benchmark. CEA's proportional share of the 38 MMT benchmark is
0.159 MMT.16 According to the Commission's emissions calculator, CEA's 38 MMT PCP would
account for 0.158 MMT in 2030 emissions, which is slightly below the assigned benchmark.
Renewable Energy
CEA's 38 MMT PCP achieves results and performance characteristics consistent with the Section
454.52(a)(1)(B) goal of ensuring that portfolios are composed of at least 50% eligible renewable
16
15
Aug. 20, 2020 Item 3 Attachment Item #3 iteplayeam_26568
resources. In 2030 CEA's 38 MMT overall PCP portfolio would consist of 82 percent eligible
renewable generation, well in excess of the 50% target.
Minimizing Bill Impact
CEA's 38 MMT PCP achieves results and performance characteristics consistent with the Section
454.52(a)(1)(D) goal of minimizing the impact of planned procurement on ratepayers' bills.
CEA's portfolio consists primarily of renewable resources that benefitted from increasing
economies of scale over the past several years and have price projections that continue to drop
in the foreseeable future.
CEA's recent procurement experience indicates that solar costs continue to decline, and lithium
ion battery storage is increasingly cost effective relative to other capacity products available in
the market, particularly when offered in a tax-advantaged hybrid configuration with solar
generation.
CEA prioritizes cost competitiveness, reliability, use of renewable energy and local resource
development. CEA anticipates that bill impacts will be minimized as new solar generation
projects generally have lower net costs than the prices paid in the short-term renewable energy
markets. Coupling new solar with battery storage increases the capacity value of the projects,
displacing the need to buy expensive resource adequacy products, and provides limited
dispatchability for the solar generation, minimizing the risk of degradation in energy value.
Further, CEA's 38 MMT PCP minimizes exposure to volatile natural gas prices and the bill
impacts that can result from periodic spikes in fossil fuel prices.
Ensuring System and Local Reliability
CEA's 38 MMT PCP achieves results and performance characteristics consistent with the Section
454.52(a)(1)(E) goal of ensuring system and local reliability. The 38 MMT PCP meets system
resource adequacy requirements as detailed in Section III.f. CEA will meet its local resource
adequacy requirements until such time as the central procurement entity takes on this
responsibility pursuant to D.20-06-002. Some of the planned capacity-only contracts in CEA's
38 MMT PCP will be displaced by local resource adequacy procured by the central procurement
entity. However, adoption of the central procurement entity construct is a recent development,
and the details of its planned procurement are not yet known. To ensure there are no reliability
gaps in CEA's 38 MMT PCP, and pursuant to Energy Division Guidance, CEA's portfolio assumes
no CAM allocations or CAM resources beyond what is described in the most recently issued
year-ahead CAM resource list and allocations. This approach, while consistent with Energy
Division direction, will likely ultimately indicate more RA than CEA will be responsible for
procuring. Thus, CEA provides this information with the understanding that its RA positions will
be reduced by any future CAM allocations.
Demand-Side Energy Management
16
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Item 3 Attachment Item #3 ItepiatIta2e22eff,fg
CEA's 38 MMT portfolio achieves results and performance characteristics consistent with the
Section 454.52(a)(1)(G) goal of enhancing demand-side energy management. CEA's portfolio
includes the effects of allocated demand response programs administered by SDG&E on behalf
of all delivery service customers within its service area. CEA does not have current plans to
administer demand response programs, but CEA may contract with demand response resources
for resource adequacy capacity to the extent such opportunities are cost competitive and
contribute to system reliability.
Minimizing Localized Air Pollutants With Emphasis on DACs
CEA's 38 MMT portfolio achieves results and performance characteristics consistent with the
Section 454.52(a)(1)(H) goal of minimizing localized air pollutants and other GHG emissions
with early priority on disadvantaged communities. CEA's 38 MMT portfolio relies primarily on
renewable generation and hydro-electric generation and would have relatively low GHG and
localized air pollution emissions. CEA's 38 MMT portfolio minimizes CEA's reliance on
unspecified system power, instead opting for renewable generation procurement and
development and hydro generation whenever feasible.
Results from the CSP tool indicate the following localized air pollutants associated with CEA's 38
MMT portfolio in 2030:
• NOx: 13
• PM 2.5: 7
• S02:1
These emissions derive from planned use of system energy in the 38 MMT PCP, as well as
emissions from CHP resources and system energy assigned to the CEA portfolio by the CSP tool.
46 MMT PCP
As demonstrated in Appendix A, CEA's 46 MMT PCP consists of a combination of:
• Utility-Scale Solar
• In-State Wind
• Short-Duration Storage
• Long-Duration Storage
• Natural Gas/Other (capacity only)
As stated above, in accordance with Section 454.51(b)(3), CEA's governing board has
determined that the resource mix in its PCP achieves "economic, reliability, environmental,
security, and other benefits and performance characteristics that are consistent with the goals
set forth in [Section] 454.51(a)(1)]." These benefits and characteristics are discussed as follows.
17
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GHG Reduction Goals
CEA's 46 MMT PCP achieves emissions equal to CEA's proportional share of the 46 MMT
benchmark. CCA Program's Proportional Share of the 46 MMT benchmark is 0.189 MMT.
According to the Commission's emissions calculator, CEA's 46 MMT portfolio would account for
0.189 MMT in 2030 emissions
Renewable Energy
CEA's 46 MMT portfolio achieves results and performance characteristics that are consistent
with the Section 454.52(a)(1)(B) goal of ensuring that portfolios are composed of at least 50%
eligible renewable resources. In 2030 CEA's 46 MMT portfolio would consist of 74 percent
eligible renewable generation, well in excess of the 50% target.
Minimizing Bill Impact
CEA's 46 MMT portfolio achieves results and performance characteristics consistent with the
Section 454.52(a)(1)(D) goal of minimizing the impact of planned procurement on ratepayers'
bills. CCA's portfolio consists primarily of renewable resources that benefitted from increasing
economies of scale over the past several years and have price projections that continue to drop
in the foreseeable future. CEA's portfolio consists primarily of renewable resources that
benefitted from increasing economies of scale over the past several years and have price
projections that continue to drop in the foreseeable future.
CEA's recent procurement experience indicates that solar costs continue to decline, and lithium
ion battery storage is increasingly cost effective relative to other capacity products available in
the market, particularly when offered in a tax-advantaged hybrid configuration with solar
generation.
CEA prioritizes cost competitiveness, reliability, use of renewable energy and local resource
development. CEA anticipates that bill impacts will be minimized as new solar generation
projects generally have lower net costs than the prices paid in the short-term renewable energy
markets. Coupling new solar with battery storage increases the capacity value of the projects,
displacing the need to buy expensive resource adequacy products, and provides limited
dispatchability for the solar generation, minimizing the risk of degradation in energy value.
Further, CEA's 46 MMT PCP minimizes exposure to volatile natural gas prices and the bill
impacts that can result from periodic spikes in fossil fuel prices.
Ensuring System and Local Reliability
CEA's 46 MMT portfolio achieves results and performance characteristics consistent with the
Section 454.52(a)(1)(E) goal of ensuring system and local reliability.
The 46 MMT PCP meets system resource adequacy requirements as detailed in Section III.f.
CEA will meet its local resource adequacy requirements until such time as the central
18
Aug. 20, 2020 Item 3 Attachment Item #3 Iternalultaz426pfz8
procurement entity takes on this responsibility pursuant to D.20-06-002. Some of the planned
capacity-only contracts in CEA's 46 MMT PCP will be displaced by local resource adequacy
procured by the central procurement entity. However, adoption of the central procurement
entity construct is a recent development, and the details of its planned procurement are not
yet known. To ensure there are no reliability gaps in CEA's 46 MMT PCP, and pursuant to
Energy Division Guidance, CEA's portfolio assumes no CAM allocations or CAM resources
beyond what is described in the most recently issued year-ahead CAM resource list and
allocations. This approach, while consistent with Energy Division direction, will likely ultimately
indicate more RA than CEA will be responsible for procuring. Thus, CEA provides this
information with the understanding that its RA positions will be reduced by any future CAM
allocations.
Demand-Side Energy Management
CEA's 46 MMT portfolio achieves results and performance characteristics consistent with the
Section 454.52(a)(1)(G) goal of enhancing demand-side energy management. CEA's portfolio
includes the effects of allocated demand response programs administered by SDG&E on behalf
of all delivery service customers within its service area. CEA does not have current plans to
administer demand response programs, but CEA may contract with demand response resources
for resource adequacy capacity to the extent such opportunities are cost competitive and
contribute to system reliability.
Minimizing Localized Air Pollutants With Emphasis on DACs
CEA's 46 MMT portfolio achieves results and performance characteristics consistent with the
Section 454.52(a)(1)(H) goal of minimizing localized air pollutants and other GHG emissions
with early priority on disadvantaged communities. CEA's 46 MMT portfolio relies primarily on
renewable generation in combination with system energy and would have relatively low GHG
and localized air pollution emissions.
Results from the CSP tool indicate the following localized air pollutants associated with CEA's 46
MMT portfolio in 2030:
• NOx: 16
• PM 2.5: 9
• S02:1
These emissions derive from planned use of system energy in the 46 MMT PCP, as well as
emissions from CHP resources and system energy assigned to the CEA portfolio by the CSP tool.
19
Aug. 20, 2020 Item 3 Attachment Item #3 Iteplayea2526M
c. GHG Emissions Results
CEA used its load-based proportional share of the 38 and 46 MMT benchmark to determine the
emissions compliance for its 38 PCP and its 46 MMT PCP. CEA's assigned load-proportional
share of the 38 MMT benchmark is 0.159 MMT. Based on the 38 MMT version of the CSP
calculator, CEA's 38 MMT portfolio would result in total 2030 GHG emissions of 0.158 MMT,
outperforming CEA's assigned share of the 38 MMT GHG reduction benchmark by 0.001 MMT.
CEA's assigned load-proportional share of the 46 MMT benchmark is 0.202 MMT. Based on the
46 MMT version of the CSP calculator, CEA's 46 MMT portfolio would result in total 2030 GHG
emissions of 0.189 MMT, which is equal to its assigned load-proportional share of the 46 MMT
benchmark.
d. Local Air Pollutant Minimization and Disadvantaged Communities
Local Air Pollutants
The 38 MMT version of the CSP calculator estimates the following emissions associated with
CEA's 38 MMT portfolio:
• NOx: 13
• PM 2.5: 7
• S02:1
The 46 MMT version of the CSP calculator estimates the following emissions associated with
CEA's 46 MMT portfolio:
• NOx: 16
• PM 2.5: 9
• S02:1
Focus on Disadvantaged Communities
CEA's IRP is fully consistent with the goal of minimizing local air pollutants, with early priority
on DACs. As identified in CalEnviroScreen 3.0, CEA serves no census tracks categorized as
Disadvantaged Communities.
In total, CEA serves 0 customer accounts located within DACs. This is approximately 0 percent
of CEA's total customer base (59,000 customers).
In developing its IRP, CEA carefully considered the impact of its resource procurement on DACs.
All of the new resources CEA plans to develop are renewable or storage with no local emissions.
20
Aug. 20, 2020 Item 3 Attachment Item #3 Iteinalfea2E626pf,60
e. Cost and Rate Analysis
CEA's 38 MMT and 46 MMT portfolios are both reasonable from a cost perspective. In selecting
resources for its portfolios, CEA carefully considered the cost implications of specific resource
selections and procurement timing. This analysis was informed by CEA's procurement
experience and the standard assumptions and results of the Commission's RESOLVE/SERVM
modeling.
In general, CEA sought to balance the need to procure resources with enough lead time to meet
CEA's LSE-specific procurement shortfalls and the Commission-identified overall system new
resource need with the cost-saving benefits of waiting to procure renewable and storage
resources with downward sloping cost projections. CEA also recognizes that future resource
costs are highly uncertain, and technological advancement can happen unexpectedly; CEA's
procurement cycle is designed to take advantage of technological and cost improvements by
adding new resource commitments incrementally over time.
CEA's PCPs take advantage of the rapidly falling cost of solar, wind, and battery storage
resources. CEA's PCPs also take advantage of the fact that, compared to Investor Owned
Utilities, CCAs have significantly shorter generation project development timelines, in part due
to the fact that CCAs do not require Commission approval of such projects. These shorter
timelines result in significant direct savings and give CEA more flexibility to time its
procurement to take maximum advantage of falling renewable generation prices.
f. System Reliability Analysis
Both CEA's 38 MMT PCP and its 46 MMT PCP are reliable and contribute CEA's fair share to
system reliability.
The effective capacity of CEA's 38 MMT PCP is provided in the following "System Reliability
Progress Tracking Table" from the its 38 MMT Resource Data Template dashboard (note that
the row containing peak demand is confidential and has been excluded from this table). The
net qualifying capacity for the month of September is shown for each year in the following
table:
21
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Item 3 Attachment Item #3 iteplayea212offia
System Reliability Progress
Tracking Table (NQC MW) for
month of September by contract
status, 38 MMT portfolio
ELCC type 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
online wind_low_cf -
online wind_high_cf -
online biomass -
online cogen -
online geothermal - - -
online hydro -
online thermal 10 10 10 - -
online battery -
online nuclear - -
online solar 1
online psh -
online unknown - 192 192 156 140 141 110 112 113 115 117
development wind_low_cf
development wind_high_cf - -
development biomass - - - -
development cogen
development geothermal
development hydro - -
development thermal -
development battery
development nuclear -
development solar
development psh
development unknown
review wind_low_cf - - -
review wind_high_cf - - - -
review biomass
review cogen - -
review geothermal - - - - -
review hydro
review thermal -
review battery - -
review nuclear -
review solar -
review - psh -
review unknown - - -
planned_existing wind_low_cf
planned_existing wind_high_cf
planned_existing biomass - - -
planned_existing cogen -
planned_existing geothermal - -
planned_existing hydro -
planned_existing thermal - -
planned_existing battery
planned_existing nuclear -
planned_existing solar - - - - -
planned_existing psh -
planned_existing unknown - -
planned_new wind_low_cf - 17 17 17 17 17 17 17
planned_new wind_high_cf - - -
planned_new biomass
planned_new cogen -
planned_new geothermal - - - -
planned_new hydro
planned_new thermal
planned_new battery - - 7 7 7 7 7
planned_new nuclear
planned_new solar
planned_new psh - - -
planned_new unknown - 50 50 50 75 75 75 75 75
TOTAL supply, NQC MW 11 202 202 206 206 207 208 210 211 213 215
22
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As demonstrated in this Table, CEA's 38 MMT PCP contributes 215 MW of peak monthly net
qualifying capacity ("NQC") in 2030. While not shown in the table above, this NQC exceeds
CEA's peak load plus 15% planning reserve margin. Of this total, 92 MW are from new
renewable and hybrid resources, and 7 MW are from new long duration storage. CEA's 38
MMT PCP includes planned contracts with existing resources, likely to be predominantly
resource in the existing natural gas generator fleet, for 117 MW of NQC.17 This balanced
portfolio of flexible capacity works to effectively and reliability integrate a renewables-heavy
portfolio, thus meeting and exceeding CEA's share of any systemwide renewable integration
resource requirement.
The effective capacity of CEA's 46 MMT PCP is provided in the following "System Reliability
Progress Tracking Table" from the its 46 MMT Resource Data Template dashboard (note that
the row containing peak demand is confidential and has been excluded from this table) ). The
net qualifying capacity for the month of September is shown for each year in the following
table:
17 An undetermined portion of this capacity is expected to be procured by the central procurement
entity.
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Aug. 20, 2020 Item 3 Attachment Item #3 ItepiatIta2=928pfe8
System Reliability Progress
Tracking Table (NQC MW) for
month of September by contract
status, 46 MMT portfolio
ELCC type 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
online wind_low_cf
online wind_high_cf -
online biomass
online cogen
online geothermal - - -
online hydro -
online thermal 10 10 10
online battery - - - - -
online nuclear - - -
online solar 1
online psh - -
online unknown 192 192 156 140 141 110 112 113 115 117
development wind_low_cf
development wind_high_cf
development biomass - - - -
development cogen
development geothermal -
development hydro - - -
development thermal - -
development battery
development nuclear - - -
development solar - - - -
development psh - - -
development unknown -
review wind_low_cf - - - - -
review wind_high_cf - - - -
review biomass
review cogen - -
review geothermal - - - -
review hydro
review thermal
review battery
review nuclear -
review solar
review psh - -
review unknown
planned_existing wind_low_cf
planned_existing wind_high_cf -
planned existing biomass - - -
planned_existing cogen -
planned_existing geothermal
planned_existing hydro - -
planned_existing - thermal
planned_existing battery
planned_existing nuclear -
planned_existing solar - - - -
planned_existing psh
planned_existing unknown
planned_new wind_low_cf - - 17 17 17 17 17 17 17
planned_new wind_high_cf - - -
planned_new biomass -
planned_new cogen - -
planned_new geothermal - - - -
planned_new hydro -
planned_new thermal -
planned_new battery - - 7 7 7 7 7
planned_new nuclear
planned_new solar -
planned_new psh - -
planned_new unknown - 50 50 50 75 75 75 75 75
TOTAL supply, NQC MW 11 202 202 206 206 207 208 210 211 213 215
24
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As demonstrated in this Table, CEA's 46 MMT PCP contributes 215 MW of peak monthly net
qualifying capacity ("NQC") in 2030. While not shown in the table above, this NQC exceeds
CEA's peak load plus 15% planning reserve margin. Of this total, 92 MW are from new
renewable and hybrid resources, and 7 MW are from new long duration storage. CEA's 46
MMT PCP includes planned contracts with existing resources, likely to be predominantly
resource in the existing natural gas generator fleet, for 117 MW of NQC.18 This balanced
portfolio of flexible capacity works to effectively and reliability integrate a renewables-heavy
portfolio, thus meeting and exceeding CEA's share of any systemwide renewable integration
resource requirement.
g. Hydro Generation Risk Management
CEA's portfolios have little dependence on hydroelectricity and relatively little exposure to the
risk of reduced hydro availability due to in-state drought. CEA's 46 MMT PCP has no planned
use of hydro, and its 38 MMT PCP includes hydro in smaller amounts than the proportions
included in the RSP (see table below). However, if draught conditions or other factors restrict
available hydro energy, CEA would plan to substitute renewable energy resources to ensure it
meets its assigned GHG benchmark.
Table 5: CEA Preferred Conforming Portfolio's Planned Use of Hydro Compared to RSP
Hydro
Resource
38 and
46 MMT
RSP MW
CEA
Proportionate
Share
CEA 46
MMT PCP
CEA 38
MMT PCP
CAISO
Hydro
7,070 30 0 13
Hydro
Imports
2,852 12 0 6
18 An undetermined portion of this capacity is expected to be procured by the central procurement
entity.
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h. Long-Duration Storage Development
The Commission's 38 MMT RSP calls for 1,605 MW of new long-duration storage to be
developed and operational by 2026, while the 46 MMT RSP calls for 973 MW of new long-
duration storage to be operational by 2026.
In response to the Commission's analysis, thirteen CCAs (the Joint CCAs) issued a request for
information ("RFI") on long-duration storage in June 2020. This RFI defined long-duration
storage resources as those with the capability to discharge at full capacity for at least 8 hours.
The RFI requested the following types of information: (1) storage technology and commercial
history; (2) project specifics, including location, permitting, financing and development risks; (3)
contracting terms and preferences, including indicative pricing.
The Joint CCAs received responses from 31 entities representing numerous types of chemical,
mechanical and thermal long-duration storage technologies, such as: lithium-ion batteries;
vanadium redox and other flow batteries; used electric vehicle batteries; waste to fuels via
ultrasound; hydrogen storage; pumped storage hydro; geomechanical pumped storage; crane
and stacked blocks; compressed air; flywheels; and molten salt and other thermal storage
technologies. Moreover, the respondents identified 25 specific projects that represent more
than 9,000 MW of capacity, two thirds of which is advertised as able to achieve commercial
operation by 2026.
CEA will be considering the information made available through the RFI and will be assessing
the economics of such projects. This assessment is expected to lead to Requests for Offers
(RF0s) and transactional discussions aimed at bringing actual projects online by 2026. For its
part, CEA anticipates it will procure its share of the CPUC's 1,605 MW target, which for CEA
translates to 7 MW of long-duration storage online by 2026. Due to the scale and complexity of
these projects, however, successful development will depend on efficient collaboration among
numerous entities including load-serving entities, developers, manufacturers, market
operators, regulators and environmental stakeholders.
Out-of-State Wind Development
The Commission's 38 MMT RSP calls for 3,000 MW of new out-of-state wind generation ("005
Wind") to be developed and operational by 2030, while the 46 MMT RSP calls for 606 MW of
new 005 Wind to be operational by 2030. CEA understands that the transmission projects
needed to connect 00S wind to the CAISO grid require significant lead-times. However, given
the fact that 005 Wind is not needed until 2030, CEA believes that a careful and considered
approach to potential 00S Wind projects is best. CEA does not have specific plans for use of
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Iteplayease23erto
00S wind at this time, but is open to purchases of such resources and will evaluate offers it
receives during its regular procurement process.
j. Transmission Development
In identifying resource locations for all portfolios, CEA was guided by the following
considerations:
• CEA has a general preference for resources located within its service area and the
communities it serves.
• CEA preferred projects in locations that can utilize existing transmission
infrastructure with minimal upgrade/modification costs.
• CEA preferred low-impact renewable energy projects that provide economic
benefit to DACs, subject to community interest in locally siting such projects.
Unlike the IOUs, CEA is not a transmission and distribution ("T&D") system operator. CEA does
not enjoy the benefits of a granular knowledge of PG&E's T&D system, and CEA is not in the
best position to identify optimal resource locations. In practice, CEA relies on project
developers to conduct the research and technical studies necessary for siting potential
generation projects. CEA evaluates projects offered by developers based on a variety of
criteria, including transmission availability, nodal prices and potential for congestion, project
viability, environmental, workforce, and other factors. As such, CEA generally utilized the RSP
selected candidate resources as a guide for likely resource locations in its 38 MMT PCP and its
46 MMT PCP. These should be treated as general expectations based on the above-listed
considerations, not set-in-stone selections, and actual project locations will be selected during
CEA's solicitation processes.
CEA's 38 MMT PCP and 46 MMT PCP include a total of 232 MW of new resources to be built at
the locations identified in CEA's 38 MMT resource data template. The following table provides
a list of these resources, their identified locations, and CEA's preferred alternate locations if the
Commission's modeling finds that the selected locations are not feasible.
New Resource
Type
Size (MW) Selected Resource Preferred Alternative
Resource/Location
Wind 75 Tehachapi Wind Southern California Desert Ex Wind _ _ _ _
Hybrid 150 New_Hybrid N/A
Storage, Long
Duration*
7 New_Li_Battery New_Flow_Battery
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*CEA is exploring numerous long-duration storage technology types, as highlighted above in
section H. However, the new resolve categories limits LSEs to "new lithium-ion" and "new flow"
technology types for purposes of the Resource Data Template.
IV. Action Plan
a. Proposed Activities
CEA's procurement process includes the following key activities:
a) Identification of planned resources by type, desired online date, and capacity.
b) Planning for procurement activities in consideration of CEA's risk management policy;
resource acquisition lead times including, where applicable, development timelines;
staff capacity; and financial considerations
c) Design and administration of resource solicitations. For new resources, these typically
take the form of periodic request for offers processes, while for existing resources,
procurement activity is more frequent and routinized
d) Careful negotiation of contract terms to ensure positive outcomes for CEA customers
with appropriate risk mitigation
e) Ongoing contract management, including where applicable, careful monitoring of
development milestones.
b. Procurement Activities
CEA intends to take the following near-term (in the next 1-3 years) to implement its IRP and
associated portfolio:
• Conduct one or more competitive solicitations for new renewable resources with
planned online dates before 2026.
• Complete ongoing negotiations for short duration storage
• Manage existing development contract for new solar project to ensure expected
commercial operation date is met
• Refine plans for procurement of long duration storage and begin solicitation process
in 2023 or 2024 for a planned online date in 2026
• Carefully manage CEA's supply portfolio to achieve CEA's policy objectives and
ensure compliance with all regulatory requirements
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c. Potential Barriers
CEA has identified the following market, regulatory, financial, or other barriers or risks that
may impede CEA's ability to acquire the resources identified in its Portfolio:
• Impacts of the Covid-19 pandemic on supply chains, the labor force, financial
markets, and the overall ability of firms to timely develop generation and storage
resources
• The potential for regulatory changes, including centralized procurement and rule
changes that create uncertainty and undermine CEA's willingness or ability to enter
into long term resource commitments
• Uncertainty around possible resource allocations from SDG&E resulting from the
PCIA working group process and the lack of an allocation method to efficiently
transfer excess resources from SDG&E to new CCAs.
• The inflexibility in long term contracting requirements under the renewable
portfolio standards program, which does not accommodate a gradual ramping of
resource commitments that would be appropriate for newly forming CCAs.
• Factors that may restrict availability of resource adequacy capacity such as
retirement of conventional resources, the potential re-rating of renewable resource
or battery storage Effective Load Carrying Capacity
• Factors that may increase CEA customer costs such as potential regulatory changes
relating to the treatment of SDG&E generation costs and the share of costs allocated
to CEA customers through the PCIA
d. Commission Direction or Actions
CEA encourages the Commission to adopt durable rules and processes to bring greater stability
to the regulatory framework within which CEA and suppliers must plan and operate. Frequent
rule changes disrupt CEA's ability to plan for the long term and to execute on the plan while
minimizing costs to its customers.
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Aug. 20, 2020 Item 3 Attachment Item #3 iteimalitagE538ff41
e. Diablo Canyon Power Plant Replacement
CEA has included plans for new capacity development in its PCPs that are sufficient to meet its
share of replacement capacity from the Diablo Canyon Power Plant. CEA's load ratio share of
Diablo Canyon is estimated to be 10 MW, and CEA has plans to add 232 MW of new capacity,
including 99 MW of (September) net qualifying capacity by 2030. 67 MW of the planned
incremental net qualifying capacity would be available by 2024 when decommissioning of
Diablo Canyon commences.
V. Lessons Learned
CEA's experience completing the resource data template and the clean system power tools
leads to the following observations and suggestions:
• The Resource Data Template "dashboard" sheet could be enhanced to auto-populate
comparisons of the LSE portfolio to the Reference System Portfolio, which could then be
directly used in the IRP Narrative
• The requirement to use "transfer_sale" and "transfer purchase" for certain entries in
the resource field caused a loss of information. It would be better to allow the actual
resource information to be entered in the resource field and include another field to
indicate if the transaction is a sale or purchase with another load serving entity.
• The resource categories in the Clean System Power tool should be consistent with those
in the Resource Data Template, and ideally a summary sheet would be created in the
Resource Data Template to compile the Supply data needed for the Clean System Power
calculator. For example, there is no category for a hybrid resource in the Clean System
Power tool and no obvious category mapping.
• The Resource Data Template should include annual CAM capacity and allow the LSE to
simply enter its load ratio share to auto-populate its CAM allocations.
• Reliability metrics should be standardized and specified to the extent that the NQC
dashboard presented in the RDT does not capture required reliability attributes.
The late receipt of final templates and instructions makes it extremely challenging complete the
IRP and obtain Board approval before the filing deadline. There were many changes in the IRP
requirements this cycle, which took considerable time to understand and get clarification
where needed. CEA recognizes the challenge Commission staff faces in trying to refine and
manage the IRP process, but more consideration must be given to the burdens this process puts
on respondent load serving entities, many of which are small entities with limited staff. In this
cycle, updated guidance was provided by the Commission as late as August nth, which is
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Aug. 20, 2020 Item 3 Attachment Item #3 Itepialitag€636fwg
unreasonably late in the process, considering the unchanged September rt filing deadline. The
Commission should establish rules that require a minimum of four months from the time that
final templates, guidance, and instructions are published and the due date for filing the IRPs.
CEA also found that the directions and guidance provided by the Commission and staff for this
IRP cycle suffered from lack of clarity and inconsistencies in certain key respects. Again, we
recognize that the IRP process is evolving, but there is tremendous room for improvement in
providing clear and consistent instructions in a timely manner.
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Item 3 Attachment Item #3 Itepialltagepopf441
Glossary of Terms
Alternative Portfolio: LSEs are permitted to submit "Alternative Portfolios" developed from scenarios
using different assumptions from those used in the Reference System Plan. Any deviations from the
"Conforming Portfolio" must be explained and justified.
Approve (Plan): the CPUC's obligation to approve an LSE's integrated resource plan derives from Public
Utilities Code Section 454.52(b)(2) and the procurement planning process described in Public Utilities
Code Section 454.5, in addition to the CPUC obligation to ensure safe and reliable service at just and
reasonable rates under Public Utilities Code Section 451.
Balancing Authority Area (CA ISO): the collection of generation, transmission, and loads within the
metered boundaries of the Balancing Authority. The Balancing Authority maintains load-resource
balance within this area.
Baseline resources: Those resources assumed to be fixed as a capacity expansion model input, as
opposed to Candidate resources, which are selected by the model and are incremental to the Baseline.
Baseline resources are existing (already online) or owned or contracted to come online within the
planning horizon. Existing resources with announced retirements are excluded from the Baseline for the
applicable years. Being "contracted" refers to a resource holding signed contract/s with an LSE/s for
much of its energy and capacity, as applicable, for a significant portion of its useful life. The contracts
refer to those approved by the CPUC and/or the LSE's governing board, as applicable. These criteria
indicate the resource is relatively certain to come online. Baseline resources that are not online at the
time of modeling may have a failure rate applied to their nameplate capacity to allow for the risk of
them failing to come online.
Candidate resource: those resources, such as renewables, energy storage, natural gas generation, and
demand response, available for selection in IRP capacity expansion modeling, incremental to the Baseline
resources.
Capacity Expansion Model: a capacity expansion model is a computer model that simulates generation
and transmission investment to meet forecast electric load over many years, usually with the objective of
minimizing the total cost of owning and operating the electrical system. Capacity expansion models can
also be configured to only allow solutions that meet specific requirements, such as providing a minimum
amount of capacity to ensure the reliability of the system or maintaining greenhouse gas emissions
below an established level.
Certify (a Community Choice Aggregator Plan): Public Utilities Code 454.52(6)(3) requires the CPUC to
certify the integrated resource plans of CCAs. "Certify" requires a formal act of the Commission to
determine that the CCA's Plan complies with the requirements of the statute and the process established
via Public Utilities Code 454.51(a). In addition, the Commission must review the CCA Plans to determine
any potential impacts on public utility bundled customers under Public Utilities Code Sections 451 and
454, among others.
Clean System Power (CSP, formerly "Clean Net Short") methodology: the methodology used to estimate
GHG emissions associated with dn LSE's Portfolio based on how the LSE will expect to rely on system
power on an hourly basis.
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Aug. 20, 2020 Item 3 Attachment Item #3 iteinge9a838R8
Community Choice Aggregator: a governmental entity formed by a city or county to procure electricity
for its residents, businesses, and municipal facilities.
Conforming Portfolio: the LSE portfolio that conforms to IRP Planning Standards, the 2030 LSE-specific
GHG Emissions Benchmark, use of the LSE's assigned load forecast, use of inputs and assumptions
matching those used in developing the Reference System Portfolio, as well as other IRP requirements
including the filing of a complete Narrative Template, a Resource Data Template and Clean System
Power Calculator.
Effective Load Carrying Capacity: a percentage that expresses how well a resource is able avoid loss-of-
load events (considering availability and use limitations). The percentage is relative to a reference
resource, for example a resource that is always available with no use limitations. It is calculated via
probabilistic reliability modeling, and yields a single percentage value for a given resource or grouping of
resources.
Electric Service Provider: an entity that offers electric service to a retail or end-use customer, but which
does not fall within the definition of an electrical corporation under Public Utilities Code Section 218.
Filing Entity: an entity required by statute to file an integrated resource plan with CPUC.
Future: a set of assumptions about future conditions, such as load or gas prices.
GHG Benchmark (or LSE-specific 2030 GHG Benchmark): the mass-based GHG emission planning targets
calculated by staff for each LSE based on the methodology established by the California Air Resources
Board and required for use in LSE Portfolio development in IRP.
GHG Planning Price: the systemwide marginal GHG abatement cost associated with achieving a specific
electric sector 2030 GHG planning target.
Integrated Resources Planning Standards (Planning Standards): the set of CPUC IRP rules, guidelines,
formulas and metrics that LSEs must include in their LSE Plans.
Integrated Resource Planning (IRP) process: integrated resource planning process; the repeating cycle
through which integrated resource plans are prepared, submitted, and reviewed by the CPUC
Long term: more than 5 years unless otherwise specified.
Load Serving Entity: an electrical corporation, electric service provider, community choice aggregator, or
electric cooperative.
Load Serving Entity (LSE) Plan: an LSE's integrated resource plan; the full set of documents and
information submitted by an LSE to the CPUC as part of the IRP process.
Load Serving Entity (LSE) Portfolio: a set of supply- and/or demand-side resources with certain attributes
that together serve the LSE's assigned load over the IRP planning horizon.
Loss of Load Expectation (LOLE): a metric that quantifies the expected frequency of loss-of-load events
per year. Loss-of-load is any instance where available generating capacity is insufficient to serve electric
demand. If one or more instances of loss-of-load occurring within the same day regardless of duration
are counted as one loss-of-load event, then the LOLE metric can be compared to a reference point such
as the industry probabilistic reliability standard of "one expected day in 10 years," i.e. an LOLE of 0.1.
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Aug. 20, 2020 Item 3 Attachment Item #3 I telyggItagajlefp ffg
Net Qualifying Capacity: Qualifying Capacity reduced, as applicable, based on: (1) testing and
verification; (2) application of performance criteria; and (3) deliverability restrictions. The Net Qualifying
Capacity determination shall be made by the California ISO pursuant to the provisions of this California
ISO Tariff and the applicable Business Practice Manual.
Non-modeled costs: embedded fixed costs in today's energy system (e.g., existing distribution revenue
requirement, existing transmission revenue requirement, and energy efficiency program cost).
Nonstandard LSE Plan: type of integrated resource plan that an LSE may be eligible to file if it serves load
outside the CA/SO balancing authority area.
Optimization: an exercise undertaken in the CPUC's Integrated Resource Planning (IRP) process using a
capacity expansion model to identify a least-cost portfolio of electricity resources for meeting specific
policy constraints, such as GHG reduction or RPS targets, while maintaining reliability given a set of
assumptions about the future. Optimization in IRP considers resources assumed to be online over the
planning horizon (baseline resources), some of which the model may choose not to retain, and additional
resources (candidate resources) that the model is able to select to meet future grid needs.
Planned resource: any resource included in an LSE portfolio, whether already online or not, that is yet to
be procured. Relating this to capacity expansion modeling terms, planned resources can be baseline
resources (needing contract renewal, or currently owned/contracted by another LSE), candidate
resources, or possibly resources that were not considered by the modeling, e.g., due to the passage of
time between the modeling taking place and LSEs developing their plans. Planned resources can be
specific (e.g., with a CA/SO ID) or generic, with only the type, size and some geographic information
identified.
Qualifying capacity: the maximum amount of Resource Adequacy Benefits a generating facility could
provide before an assessment of its net qualifying capacity.
Preferred Conforming Portfolio: the conforming portfolio preferred by an LSE as the most suitable to its
own needs; submitted to CPUC for review as one element of the LSE's overall IRP plan.
Preferred System Plan: the Commission's integrated resource plan composed of both the aggregation of
LSE portfolios (i.e., Preferred System Portfolio) and the set of actions necessary to implement that
portfolio (i.e., Preferred System Action Plan).
Preferred System Portfolio: the combined portfolios of individual LSEs within the CA ISO, aggregated,
reviewed and possibly modified by Commission staff as a proposal to the Commission, and adopted by
the Commission as most responsive to statutory requirements per Pub. Util. Code 454.51; part of the
Preferred System Plan.
Reference System Plan: the Commission's integrated resource plan that includes an optimal portfolio
(Reference System Portfolio) of resources for serving load in the CA ISO balancing authority area and
meeting multiple state goals, including meeting GHG reduction and reliability targets at least cost.
Reference System Portfolio: the multi-LSE portfolio identified by staff for Commission review and
adopted/modified by the Commission as most responsive to statutory requirements per Pub. Util. Code
454.51; part of the Reference System Plan.
Short term: Ito 3 years (unless otherwise specified).
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Aug. 20, 2020 Item 3 Attachment Item #3 iteplawaivEyiBraerg
Staff: CPUC Energy Division staff (unless otherwise specified).
Standard LSE Plan: type of integrated resource plan that an LSE is required to file if it serves load within
the CA/SO balancing authority area (unless the LSE demonstrates exemption from the IRP process).
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Aug. 20, 2020 Item 3 Attachment Item #3 Itepayaglei4,5f ten
CEA 2030 Resource Mix — 38 MMT BAPP
Resource Type
Existing Resources
(Owned/Contracted)
Existing Resources
(Planned
Procurement)
Existing Resources
(CAM)
New Resources
(In Development)
Future New
Resources Total
Nuclear 0
CH P 0
Natural Gas 0
Coal 0
Hydro (Large) 13 13
Hydro (Scheduled
Imports)
6 6
Biomass 0
Geothermal 0
Hydro (Small) 0
Wind 32 75 107
Out-of-State Wind
on New
Transmission
0
Solar 50 150 200
Customer Solar 0
Battery Storage 0
Pumped (long-
duration) Storage
0
Shed Demand
Response
0
Capacity-Only
Natural Gas 72 45 117
Battery Storage 0
Long Duration
Storage
7 7
Aug. 20, 2020
Item 3 Attachment
Item #3
Itepal%agte246pf41g
CEA 2030 Resource Mix —46 MMT PCP
Resource Type
Existing Resources
(Owned/Contracted)
Existing Resources
(Planned
Procurement)
Existing Resources
(CAM)
New Resources
(In Development)
Future New
Resources Total
Nuclear 0
CHP 0
Natural Gas 0
Coal 0
Hydro (Large) 0
Hydro (Scheduled
Imports) 0
Biomass 0
Geothermal 0
Hydro (Small) 0
Wind 19 75 94
Out-of-State Wind
on New
Transmission 0
Solar 30 150 180
Customer Solar 0
Battery Storage 0
Pumped (long-
duration) Storage 0
Shed Demand
Response 0
Capacity-Only
Natural Gas 72 45 117
Battery Storage 0
Long Duration
Storage 7 7
Aug. 20, 2020 Item 3 Attachment
Item #3
Iteplalltage4eypf41g