NW Council blog post – Northwest energy future: Efficient, low-cost, low carbon

The future of electric power in the Northwest is efficient, low-cost, low-carbon, and reliable. In fact, energy efficiency meets nearly all new load growth for the next 20 years.

That’s the message from the latest preliminary results of the Council’s early scenario analysis modeling using its Regional Portfolio Model, which estimates the regional costs and risks associated with pursuing resource development strategies. Results from the model will be used to inform the components of the resource strategy in the Seventh Northwest Power Plan, which should be completed by the end of 2015.

In the latest round of modeling, the Council’s power planning staff looked at three scenarios across 800 possible futures. The first removed all uncertainty so that resources are selected with perfect knowledge of such variables as load growth, natural gas prices and water conditions. The second, and more realistic scenario, tested resource strategies across a wide range of load growth, wholesale electricity market prices, natural gas costs and water conditions. This scenario reflected current energy policy, but assumed no incremental cost or limits on future carbon emissions. The third scenario is identical to the second, except that it modeled uncertainty in the future cost of carbon emissions ranging from zero to $110 per metric ton. Highlights from the preliminary results include:

• An estimated 3,800-4,500 average megawatts of energy efficiency are cost-effective to be developed over the 20-year planning horizon.
• Net regional load stays essentially flat for the 20-year planning period as long as the energy efficiency is achieved.
• While energy efficiency meets nearly all load growth, new generating plants may be needed beginning around 2026, primarily to replace retiring coal plants.
• Demand response, which means voluntarily reducing power consumption during periods of peak demand, is selected by the model to meet winter peaking capacity requirements. Demand response resources are being selected by the model because they come in smaller increments, have shorter lead times, and are lower cost than thermal resources.
• Only about 900 megawatts of renewable energy capacity (300 average megawatts of energy), is developed, mostly after 2026. “This development is not to offset carbon but because the second phases of some states’ renewable portfolio standards come into play and there’s not enough renewable energy credits in the bank to cover them,” Power Planning Director Tom Eckman said.

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