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HomeMy WebLinkAbout20140701DeVol Direct.pdfrN THE MATTER OF THE APPLICATION OE IDAHO POWER COMPANY TO IMPLEMENT SOLAR INTEGRATION RATES AND CHARGES. REEEIV[S mlq JUL - | Ptl lrr 53 unl'B#lo&tfiil$s,** rPC-E-14-18 BEEORE THE IDAHO PUBLIC UTILITIES COMMISSION ) ) ) CASE NO. ) ) IDAHO PO9TER COMPANY DIRECT TESTIMONY OE PHILIP B. DEVOL 1 2 3 4 5 6 7 I 9 10 11 T2 13 74 15 L6 77 l_8 19 20 27 22 23 24 25 O. Pl-ease state your name and business address. A. My name is Philip B. DeVol and my business address is 7227 West Idaho Street, Boise, Idaho 83702. O. By whom are you employed and in what capacity? A. I am employed by Idaho Power Company ("fdaho Power" or "Company") as the Resource Plannlng Leader o Please describe your educatj-onal- background and work experience with Idaho Power A.In May of 1989, I received Science Degree in Mathematics from Miami Oxford, Ohio. I then received a Master in Biostatistics from the University of 1991. a Bachel-or of University in of Science Degree Michigan in May of O. Please descrj-be your work history at Idaho Power. A.I began my empJ-oyment with Idaho Power in 2007 as an Engi-neering Specialist in the Water Management Department. In this position, I was responsible for modeling of the Idaho Power hydroelectric system for the Integrated Resource Plan ("fRP") and relicensing studies. In 2004, T became a Water Management Operatj-ons Analyst, where I continued to be responsible for hydroelectric system modeling. In 2005, I became a Planning Analyst in the Power Supply Planning Department. In this position, I was DEVOL, Dr 1 Idaho Power Company 1 2 3 4 5 6 7 I 9 10 11 72 13 t4 15 L6 L1 18 79 20 2L 22 23 24 25 responsible for the compj-1atj-on of Idaho Power's long-term operating plan prepared on a monthly basis as part of the Company's plan for managing risk. My duties in this positi-on also expanded to include the study of wind integration. I became the Power Supply Planning Leader in 2010 and Resource Planning Leader j-n 2013. My duties in these positions have included project management for the most recent Idaho Power wind integration study. I have been involved in regional and national proceedings related to the study of wind integration. I participated in methodology discussions for the 2001 Wind Integration Action Plan produced by the Northwest Wind Integration Forum. I have attended numerous Utility Wind Integratj-on Group (*UWIG") workshops, and presented at UWIG workshops in Oklahoma City in 2006 and Portland, Oregon, in 2007. I also presented to the Idaho Wind Working Group at its September 2077 meeting. In November of 20L3, I presented at a Centre for Energy Advancement through Technol-ogical Innovati-on workshop focused on forecasting uncertainties for renewable energy supply. I am leading the sol-ar integration study on behalf of Idaho Power. What is the purpose of your testimony in this DEVOL, Dr 2 Idaho Power Company matter? o. 1_ 2 3 4 5 6 1 I 9 10 11 72 13 L4 15 76 L7 18 t9 20 27 22 23 24 25 A. The purpose of my testimony is to describe Idaho Power's solar integration study ("Study" or *2014 Study" or "Sofar Study") and to provide the results. The 201-4 Sol-ar Integratj-on Study Report ("Study Report") is attached hereto as Exhibit No. 1. This Study Report was completed on June 76, 2074, and filed with the Idaho Public Utilities Commission on June 17, 2014, in Case No. IPC-E- 1,4-09. o.Can you provide a high level description or summary of the Company's 201,4 Study? A.Yes. Electric power f rom sol-ar generati-on resources exhibits greater variabil-ity and uncertainty than energy from conventional generation sources. The greater variability and uncertaj-nty exhibited by solar resources requires an electric utility integrating solar to modify its operating practices by holding extra operating reserves on dispatchabl-e generation resources. The effect of having to hold operatj-ng reserves on dispatchable resources is that the use of those resources is restricted and they cannot be economj-caIIy dispatched to their ful-l-est capability. The objective of the Study is to determine the costs of the operational- modifications necessary to integrate sol-ar generati-on. The Company's Sol-ar Study determined solar integration costs for four solar build-out scenarios at DEVOL, Dr 3 Idaho Power Company 1 2 3 4 tr 6 7 8 9 10 11 72 13 L4 1_5 16 L7 18 79 20 2t 22 23 24 25 installed capacities of 100 megawatts ("MW"), 300 MW, 500 MW, and 700 MW. The Study utilized geographically dispersed build-out scenarios with solar generation l-ocated across the Company's service territory at Parma, BoJ-se, Grand View, Twin Fal1s, Picabo, and Aberdeen. Pages 6 and I of the Study Report provide additional- j-nformation regarding the buj-ld-out scenarios. The Company initlated the Study with the formation of a Technical Review Commlttee ("TRC"), with the purpose of providing input, review, and guidance for the Study. In coll-aboration with the TRC, Idaho Power organized the Study into four primary steps: (1) data gathering and scenario development; (2) statistical--based analysis of solar characteristics; (3) production cost sj-mul-ation analysis; and (4) study concl-usions and resu1ts. The Study determined sol-ar integration costs through paired simul-ation of Idaho Power's system and each sol-ar build-out scenario. Each pair of simulations consists of a test case in which extra capacity in reserve is required of dispatchable generators to a.l-low them to respond to unplanned sol-ar variations and a base case in which no extra capacity in reserve is required. The solar integration costs indicated by the simulations are provided bel-ow. These costs are al-so found in Table 2, page 3 of DEVOL, Dr 4 Idaho Power Company 1 2 3 4 the Study Report, ds well as Tabl-e 8 and Table 9 on page 15 of the Study Report. Average Integration Cost Per Mt[h (2Ot4 cost and do].lars) 5 6 1 Incremental Integration Cost Per M[iIh (2OL4 cost and do].].ars) Penetration Level 0-100 MW 100-300 Mlir 300-500 MW 500-700 MW Integration Cost $0.40 $1. s0 $2.80 $4.40 I 9 Q. When did Idaho Power initiate the current 10 solar integration study? 11 A. The official- Study kick-off was on August 15, 72 20L3, with the first meeting of the TRC. 13 O. What is the TRC? 74 A. The TRC was formed during the summer of 20L3 15 with the purpose of providing input, review, and gui-dance 76 for the Study. It is made up of participants from outside I7 of Idaho Power that have an interest and/or expertise with 18 the integration of intermittent resources onto utility 19 systems. The TRC consists of: Brian Johnson from the 20 Universj-ty of Idaho; Jimmy Lindsay from the Renewable 27 Northwest Project (*RNP") (now with Portl-and General- 22 El-ectric); Kurt Myers from the Idaho National Laboratory; 23 and Paul- Woods with the City of Boise (now self-employed as 24 a consultant). In addition to the members of the TRC, 25 Staff from both the Idaho and Oregon commissions are DEVOL, Dr 5 Idaho Power Company Build-out Scenarios 0-100 MW 0-300 MW 0-500 MW 0-700 Mv[ Integration Cost s0.40 s1.20 s1.80 $2.s0 t 2 3 4 5 6 1 I 9 10 11 72 13 T4 15 L6 77 18 79 20 2! 22 23 24 25 o. A. participants in the Study. Rick Sterling from the fdaho Publ-ic Utilities Commissj-on Staff and Brittany Andrus and John Crider from the Publ-ic Utility Commission of Oregon Staff have participated throughout the Study. Although Mr. Lindsay left RNP, he continued to participate as a TRC member. Cameron Yourkowski was designated by RNP as Mr. Lindsay's replacement for the TRC. Similarly, Mr. Woods, although he left employment with the City of Boj-se and is now a self-employed consultant, has continued to serve as a member of the TRC. How is the Study being conducted? The conduct of the Study is guided by two documents that were shared with and discussed with the TRC. PrincipTes for TechnicaL Review (fRC) Invol-vement in Studies of VariabLe Generation Integration into ELectricaT Power Systems was produced by the National- Renewable Energy Laboratory (*NREL") and Utility Variable-generation Integration Group (*UVIG"). The NREL/UVIe principles document provides guidance in defining the important role of the TRC in the Study. The second report, The Evofution of Wind Power Integration Studies: Past, Present, and Future, was authored by five NREL researchers considered to be at the forefront of the study of renewabl-e integration and was published by the Instj-tute of Electrical and Electronics Engineers ("IEEE"). Even though the report was DEVOL, DI 6 Idaho Power Company 1 2 3 4 5 6 1 I 9 10 11 t2 13 74 15 1,6 1,7 18 79 20 21- 22 23 24 25 written from the perspective of wind integration, the principles remain the same for sofar j-ntegration. This report is used as the roadmap for Idaho Power's sol-ar intdgration study. So1ar, like wind, is variable and uncertain and, consequently, the system of dispatchabl-e resources has to be operated differently in order to successfully integrate the generation without compromising reliability. 0. A. What process is the Study following? The Study is generally fol-lowing the process outl-ined in the IEEE report, which includes: (1) data gathering and scenario development; (2) study analysis- a. statistical-based analysis of solar characteristics, b. production cost simulation analysis, and c. reliability assessment; and (3) study conclusions and results. O. Has the TRC agreed with and been involved with this process? A.Yes. Idaho Power has comprehensively wal-ked through both guiding documents, as wel-l- as the steps outlined above, with the TRC. Additional-J-y, the importance of the guiding documents was emphasized to participants at a May 7, 2074, public workshop. The TRC was extensively involved in the first step, data gathering and scenario deveJ-opment. The TRC has been integrally involved with the identification of suitable sources of solar production DEVOL, Dr 1 Idaho Power Company 1 data, dS well as discussions leading to the development of 2 scenarios to be studied. The TRC has a leading rol-e in 3 advising as to the use of a technique to transform point- 4 source solar data to meaningful production data for a solar 5 farm. The technique is called wavel-et variability modeling 6 and is described on page 8 of the Study Report. The TRC's 7 counsel with respect to Idaho Power's use of the wavelet 8 technique was important and needed. 9 Q. Can you further describe how the Study 10 progressed to completion? 11 A. Yes. One of the larger tasks of step L, data 72 gathering and scenario deveJ-opment, as noted j-n the IEEE 13 report, is the undertaking invo1ved with comi-ng up with t4 solar resource data that is needed to model- future power 15 output. In fact, the Study's biggest hurdle was obtaining 16 the solar resource data needed to model solar power output. 71 The solar build-out scenarios consj-der solar plants at six 18 locations in southern Idaho: Parma, Boise, Grand View, 19 Twin Fal-l-s, Picabo, and Aberdeen. The Study was able to 20 obtain solar data from the U.S. Bureau of Recl-amati-on 2l AgriMet network at the desired five-minute time step for 22 all- locations except Grand View. NREL maps indicate the 23 area surrounding Grand View and Glenns Ferry has the 24 highest annual solar intensj-ty in the state. For this 25 reason, fdaho Power and the TRC have felt it is important DEVOL, DI 8 Idaho Power Company 1 2 3 4 5 6 7 I 9 10 11 L2 13 L4 15 t6 l1 18 19 20 2L 22 23 24 25 to model- a sofar plant at Grand View. Obtaining five- minute sol-ar data for Grand View has required the acquisition of data from SolarAnywhere, which is a web- based service from Clean Power Research providing satellite-derived solar irradiance data. The Study did not recej-ve data for Grand View from SolarAnywhere until- April 2074, causing delay in the Study schedule. With the acquisition of data for the Grand View area, the Study progressed into the statistlcal--based analysis of sol-ar characteristics. The intent of this analysis is to translate the variability and uncertainty present in the solar data to an incremental reserve requJ-rement. The NREL authors of the IEEE report describe this as an analysis to determine the increase in ancil-J-ary services required by a given sol-ar scenarj-o, where NREL defines ancillary services as services that help grid operators maintain ba1ance on el-ectric power systems. Idaho Power dj-scussed with the TRC and workshop participants the next step in the Study was to take the increase in reserve requirement, or ancill-ary servj-ces, from step 2.a for any given sol-ar scenario and to input it into the Study's production cost simulations to determine the cost of carrying increased ancillary services, step 2.b. DEVOL, DI 9 Idaho Power Company 1 2 3 4 q 6 7 I 9 10 11 L2 13 L4 15 L6 L7 18 19 20 27 22 23 24 25 It was also at this point that the decision was made to modify the build-out scenarios to include higher levels of solar penetration. This decj-sj-on was based primarily upon the increase in proposed sol-ar projects for Idaho Power's system that outpaced the largest penetration l-evel- initial-Iy contemplated by the Study. Initially, the Study planned to analyze four build-out scenarios: dispersed 50 MW; dispersed 100 MW; dispersed 300 MW; and clustered 300 MW. However, with the emergence of over 500 MW of solar generation seeking contracts with the Company, the need to study beyond the 300 MW l-evel became apparent. Consequently, in a May !6, 20L4, meeti-ng, the Company communicated to the TRC the following four revised bui1d- out scenarios: dispersed 100 MW; dispersed 300 MW; dispersed 500 MW; and dispersed 700 MW. The proposal to study these revised build-out scenarios was not controversial with the TRC, and they recognized the need to study expanded build-outs glven the potential- development described in the Company's May 13, 20L4, fi11ng in Case No. IPC-E-14-09 seeking a suspension of its obligation to purchase Public Utility ReguJ-atory Poli-cies Act of 7918 solar generation until the Study coul-d be completed. o.How was the statistical based analysis of DEVOL, Dr 10 Idaho Power Company solar characteristics conducted? I 2 3 4 5 6 7 8 9 10 11 t2 13 74 15 76 77 18 19 20 27 22 23 24 25 A.Based on Idaho Power's review of the sol-ar data from its buil-d-out scenarios, the Company focused its analysis of varj-abiJ-ity and uncertainty in the context of hour-ahead system scheduling. In this context, the hour- ahead system scheduler requires for a given operating hour a forecast for hourJ-y average sol-ar production, as well- as forecasts for l-ower and upper bounds on instantaneous solar production. The Study assumes these forecasts for sofar productj-on need to be delivered to the system scheduler 45 minutes prior to the start of the operating hour being scheduled. With this information, the system can be scheduled according to the forecast for hourly average solar production and, importantfy, also be scheduled in a manner allowing dispatchable generators to respond during the operating hour if solar production varies from the forecasted leveI toward either bound. Discussion of the regional electric power market and the Company's hour-ahead scheduling activities is incl-uded in pages 8 through 11 in the Study Report. The hour-ahead hourl-y average solar production forecast developed for the Study is based on persistence, with an adjustment to account for the known changes in the sun's position. The l-ower and upper bounds on sol-ar production are established as percentages of the hourly average solar production forecast, with adlustments made to DEVOL, Dr 11 Idaho Power Company 1 2 3 4 q 6 7 8 9 10 11 t2 13 1,4 15 16 L7 18 L9 20 2L 22 23 24 25 o. A. narrow the bounds in response to periods of stable production. The logic developed to make these adjustments to the bounds was well received by the TRC, and has been described in TRC meetings as an example of a "learning" or "adaptive" modeI. The techniques fol-lowed to develop the hour-ahead sol-ar production forecast and the accompanying bounds on instantaneous solar production were described to the TRC in a May 76, 20L4, meeting. What was the next step in the Study process? The next step was the production cost simul-ations (step 2.b) . As described earlier in my testimony, the Study followed the conventional design of simul-ating two scenarios: a test scenario having incremental amounts of solar-caused reserve and a base scenario wi-thout the incremental reserve. O. Could you describe the TRC invol-vement in the l-ater stages of the Study? A.Yes. The TRC schedule, including the meeting dates and agenda items, is set forth on page 23 of the Study Report. The final formal TRC meeting was held on May 29, 20L4. The intent of this meeting was to provj-de a relatively high-l-evel description of the production cost simulations. In response to TRC expressions of interest in understanding how reserves influence system operations, Idaho Power al-so provided an overview of operating DEVOL, DI L2 fdaho Power Company 1 2 3 4 5 6 7 I Y 10 11 12 13 t4 15 t6 71 18 19 20 27 22 23 24 25 reserves. The discussion during the NIay 29 meeting focused on an explanati-on of the productj-on cost modeI, a demonstration of the input of solar-caused reserve requirements to the production cost model, and an illustration of the effect of the solar-caused reserves on simul-ated operatlons. The Company acknowl-edged the complexity of the production cost simul-atj-ons to the TRC. There were expressi-ons from some in the TRC to explore in further detail-, specifically to explore additional water year types (e.9., 1ow and high water year types). However, the Company expressed that for this phase of the Study further exploration of additional- water years was not necessary, emphasizing the need for a timely completion of the Study. Finally, the May 29 meeting ended with a presentation of the integration costs found by the productj-on cost simulations, which at the time were considered preliminary. A draft study report was circulated to the TRC on June 2, 20t4. The Company indicated in its correspondence with the TRC on June 2 the continued objective to complete the Study by mid-June. The TRC members submi-tted comments on the process and the Study. Several TRC members identified items for further study, which are listed in the Study Report on page 18. DEVOL, Dr 13 Idaho Power Company 1 2 3 4 5 6 7 I 9 10 11 T2 13 t4 15 O. Can you describe the resul-ts of the Study? A. Yes. The objective of the Study was to determine the costs of the operational modifications necessary to integrate solar generation. The integration costs are driven by the need to carry extra capacity in reserve to allow bidirectional response from dispatchable generators to unplanned variations in sofar producti-on. The simulations performed for the Study indicate the followi-ng costs associated with holding the extra capacity in reserve. The provided costs are the costs to integrate sol-ar production for the calendar year 2014, and are not costs averaged or levelized over the life of the solar power p1ant. Average Integration Cost Per MBlh (2OL4 cost and dollars) t6 l1 1B L9 20 2L 22 23 24 25 Incremental Integration Cost Per Ml{h (2OL4 cost and dollars) O. Are the resul-ts of Idaho Power's Solar Study consistent wj-th those conducted for other utility systems? A. Yes. Idaho Power's Study resul-ts fall- within the range reported by other utilities for the cost of integrating solar generation. While the study of solar integration is rel-atively young, especially when compared DEVOL, Dr 74 Idaho Power Company Build-out Scenarios 0-100 MW 0-300 MW 0-500 MW 0-700 MW Integration Cost s0.40 $7.20 S1 BO $2.s0 Penetration Level 0-100 MW 100-300 MW 300-500 MW 500-700 MW Integration Cost $0 40 s1. s0 $2 BO $4.40 1 to the study of wind integration, I am aware of solar 2 integration studies that have been conducted for other 3 utility systems. Notable among these studies are a 20LL 4 solar integration study for the NV Energy system, a 201,2 5 solar integration study for Arizona Public Servj-ce (*APS"), 6 and a 2014 solar lntegration study for Tucson El-ectric 7 Power (*TEP"). The NV Energy study reports integration 8 costs ranging from $3.00 to $8.00 per megawatt-hour (*MWh") 9 of integrated sol-ar generation. The APS study reports 10 integration costs ranging from about $1.50 to $3.00 per MWh 11 of integrated solar generation. The TEP study reports an 1,2 integration cost of $5.20 per MWh. 13 A. Does this conclude your testimony? L4 A. Yes. 15 76 L7 18 19 20 2t 22 23 24 25 DEVOL, Dr 15 Idaho Power Company 1 2 3 4 5 6 1 I 9 10 11 L2 13 74 15 L6 L1 18 79 20 2L 22 23 24 25 26 27 28 29 30 31 32 Tt Philip B. DeVol, having been duly sworn to testify truthfully, and based upon my personal knowledge, state the following: I am employed by Idaho Power Company as the Resource Planning Leader in the Water and Resource Planning Department and am competent to be a witness in this proceeding. I decl-are under penalty of perjury of the laws of the state of Idaho that the foregoing pre-filed testimony and exhibit are true and correct to the best of my information and belief. DATED this 25th day of June 2OL4 STATE OF IDAHO ) ) County of Ada ) SUBSCRIBED June 20L4. ATTESTATION OF TESTIMONY SS. AND SWORN to before me this 25th day of or Idaho Residing at: DEVOL, Dr L6 Idaho Power Company PhiIip ffi rl !tt-, It %\ J,e *oT^tt -e(lftrrlt& ffiSt$ My commission BEFORE THE IDAHO PUBLIG UTILITIES GOMMISSION GASE NO. IPC-E-14-18 IDAHO POWER COMPANY DEVOL, DI TESTIMONY EXHIBIT NO. Solar lntegration Study Report nlDll0rlptr;191- June 2014 @ 2014 ldaho Power Exhibit No. 1 Case No.|PC-E-14-18 P. DeVol,lPC Page 1 of36 ldaho Power Company Solar lntegration Study Report TneLe oF CoNTENTS Page 1 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 3 of 36 Solar lntegration Study Report ldaho Power Company LIsT oF TABLES Table I Solarbuild-out scenarios studied.... ..................3 Table 2 Average integration cost per MWh for solar build-out scenarios.... ..........................3 Table 3 Solar build-out scenarios studied ......................6 Table 4 AgriMet site latitude, longitude, and elevation used in IPC's solar integration study .................7 Table 5 Forecast error for the hour-ahead solar production forecast .................10 Table 6 Forecasted incremental and decremental capacity held in reserve, water year 2012 .................11 Table 7 Inputs for the solar integration study production cost simulations............ ............-12 Table 8 Average integration cost per MWh for solar build-out scenarios.... ........................15 Table 9 lncremental integration cost results LIST oF FIGURES Figure I AgriMet sites used in IPC's solar integration study ............7 LIST OF APPENDICES Appendix I Solar integration study appendix.... .................21 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,IPC Page 4 of 36 Page2 ldaho Power Company Solar lntegration Study Report ExeCuTME SUMMARY Electric power from solar photovoltaic resources exhibits greater variability and uncertainty than energy from conventional generators. The greater variability and uncertainty exhibited by solar photovoltaic resources require an electric utility integrating solar to modi$ the operation of dispatchable generating resources. The modified operation involves the sub-optimal dispatch of generators to carry extra capacity in reserve for responding to unplanned solar excursions. The objective of the ldaho Power solar integration study is to determine the costs of the operational modifications necessary to integrate solar photovoltaic plant generation. This study determines these costs for four solar build-out scenarios provided in Table 1. Table 1 Solar build-out scenarios studied lnstalled Capacity of Solar Build-Out Scenarios Site 100 megawatts (MW)300 Mw 500 Mw 700 Mw Parma, lD Boise, lD Grand Vieu lD Twin Falls, lD Picabo, lD Aberdeen, lD TotalMW 50 100 100 100 50 100 500 30 60 60 60 30 60 300 10 20 20 20 10 20 100 100 100 150 100 100 150 700 The study determines solar integration costs through paired simulations of the Idaho Power system for each solar build-out scenario. Each pair of simulations consists of a test case in which extra capacity in reserve is required ofdispatchable generators to allow them to respond to unplanned solar excursions and a base case in which no extra capacity in reserve is required. The solar integration costs indicated by the simulations are provided in Table 2. Table 2 Average integration cost per MWh for solar build-out scenarios 0-100 Mw 0-300 i,lW 0-500 Mw 0-700 Mw lntegration cost $0.40/MWh $1.20/MWh $1.80/MWh $2.so/[4vvh Note: Costs are in 2014 dollars and rounded from simulation results to the nearest $0.'10. Page 3 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 5 of 36 Solar lntegration Study Report ldaho Power Company This page left blank intentionally. Page 4 Exhibit No. 1 Case No. IPC-E-I4-18 P. DeVol,lPC Page 6 of 36 ldaho Power Company Solar lntegration Study Report AcxttowLEDGMENTs Idaho Power acknowledges the important contribution of the Technical Review Committee (TRC) in this solar integration study. The TRC has been involved from the study outset in August 2013 and has provided substantial guidance. Idaho Power especially thanks the TRC for the collegial discussions of solar integration during TRC meetings. These discussions helped shape the study methods followed and are consistent with the TRC guidelines as provided by the Utility Variable-Generation Integration Group (UVIG) and the National Renewable Energy Laboratory NREL) (UVIG and NREL n.d.). The following are members of the Idaho Power solar integration study TRC: o Brian Johnson, University of ldaho o Jimmy Lindsay, Portland General Electric (formerly of Renewable Northwest Project) o Kurt Myers, Idaho National Laboratory o Paul Woods, (formerly of City of Boise) o Cameron Yourkowski, Renewable Northwest Project (replacing Jimmy Lindsay) Staff from the Idaho and Oregon regulatory commissions have participated as observers throughout the process. The following staffhave been observers of the process: o Brittany Andrus, Public Utility Commission of Oregon (OPUC) staff o John Crider, OPUC staff o Rick Sterling, Idaho Public Utilities Commission (IPUC) staff TRC members and regulatory observers serve either voluntarily or are paid by their own employers and receive no compensation from Idaho Power. The company is grateful for the TRC's time spent supporting the study and recognizes this support has led to a better study. lrurnooucrroN Electric power from solar photovoltaic resources exhibits greater variability and uncertainty than energy from conventional generators. Because of the gleater variability and uncertainty, electric utilities incur increased costs when their other generators are called on to integrate photovoltaic solar plant generation. These costs occur because power systems are operated less optimally in order to successfully integrate solar plant generation without compromising the reliable delivery of electrical power to customers. Idaho Power has studied the modifications it must make to power system operations to integrate solar photovoltaic power plant generation connecting to its system. The objective of this solar integration study is to determine the costs of the operational modifications necessary to integrate solar plant generation. This report is intended to describe the operational modifications and the resulting costs. Page 5 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,lPC Page 7 of 36 Solar lntegration Study Report ldaho Power Company In collaboration with the TRC, Idaho Power organized the study into four primary steps: 1. Data gathering and scenario development 2. Statistical-based analysis of solar characteristics 3. Production cost simulation analysis 4. Study conclusions and results These steps were formulated based on an article published by the Institute of Electrical and Electronics Engineers (IEEE) describing methods for studying wind integration (Ela et al. 2009). While the IEEE article, which was authored by leading researchers at the NREL, was written from the perspective of studying grid integration of wind generation, the principles underlying the study of wind integration are readily transferrable to the study of solar integration. Both wind and solar bring increased variability and uncertainty to power system operation, and a key objective of an integration study for each is to understand how variability and uncertainty lead to impacts and costs. Dara GarnenrNc AND Scenenro DEVELopMENT A critical element of the solar integration study is the solar generation data developed for the studied solar build-out scenarios. For ldaho Power's solar integration study, the solar build-out scenarios in Table 3 were studied. Table 3 Solar build-out scenarios studied lnstalled Gapacity of Solar Build-Out Scenarios 100 megawatts (MW)300 Mw 500 Mw 700 Mw Parma, lD Boise, lD Grand View, lD Twin Falls, lD Picabo, lD Aberdeen, lD Tota! MW 10 20 20 20 10 20 100 50 100 100 100 50 100 500 100 100 150 100 100 150 700 30 60 60 60 30 60 300 The above build-out scenarios were developed in consultation with the TRC to represent geographically dispersed build-outs of solar power plant capacity. The importance of geographic dispersion in reducing integration impacts and costs is discussed in greater detail later in this report. The sites from the solar build-out scenarios are part of the established United States (U.S.) Bureau of Reclamation (USBR) AgriMet Network (AgdMet). AgriMet is a satellite-based network of automated agricultural weather stations operated and maintained by the USBR. The stations are located in irrigated agricultural areas throughout the Pacific Northwest and are Exhibit No. 'l Case No. IPC-E-14-18 P. DeVol, IPC Page 8 of 36 Page 6 ldaho Power Company Solar lntegration Study Report dedicated to regional crop water-use modeling, agricultural research, frost monitoring, and integrated pest and feftility management. The six sites are spread across southern Idaho and cover over 220 miles from east to west (Figure 1). Sites represent elevations ranging from 2,300 feet to 4,900 feet (Table 4). r.1 Tlrin Falls Figure 1 AgriMet sites used in IPC's solar integration study Table 4 AgriMet site latitude, longitude, and elevation used in IPC's solar integration study Latitude (N)Longitude (west)Elevation (feet)Elevation (meter) Parma Boise Grand View Twin Falls Picabo Aberdeen 1 16.93 1 16.18 116.06 't14.35 114.17 112.83 43.18 43.60 42.91 42.55 43.31 42.95 2,305 2,720 2,580 3,920 4,900 4,400 702 829 786 1,195 1,494 1,341 All data used in the integration study are 5-minute interval global horizontal irradiance data from each site. ldaho Power worked directly with the USBR Pacific Northwest Region AgriMet manager to obtain data for the sites. AgriMet data was augmented with data from the University of Oregon Solar Radiation Monitoring Laboratory when AgriMet data was incomplete. The use of high-resolution (5-minute interval) data is critical to characterizing the variability of solar. An altemative data-gathering approach was necessary for the Grand View site, for which only l5-minute data was available. To acquire 5-minute data for Grand View, Idaho Power contracted Page 7 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 9 of 36 Solar lntegration Study Report ldaho Power Company with SolarAnywhere to provide high-resolution modeled solar data. SolarAnywhere uses hourly satellite images processed using the most current algorithms developed and maintained by Dr. Richard Perez at the University at Albany (SUNY). The algorithm extracts cloud indices from the satellite's visible channel using a self-calibrating feedback process capable of adjusting for arbitrary ground surfaces. The cloud indices are used to modulate physically-based radiative transfer models describing localized clear-sky climatology. Wavelet-Based Variability Model AgriMet solar data represents conditions at a single point. To better reflect conditions at a solar plant size, the TRC recommended the use of the wavelet-based variability model (WVM) developed by Dr. Matt Lave of Sandia National Labs (Lave etal.20l34b). WVM is designed for simulating solar photovoltaic power plant output given a single irradiance point-sensor time series. The application of the WVM to the point-sensor time series produces a variability reduction reflecting an upscaling of the point-source data to a solar plant-sized area. Research and use into the WVM showed it is not useable at time steps (intervals) greater than l0 minutes and that times steps greater than 5 minutes may under-represent variability in dispersed systems. Solar Plant Gharacteristics This study assumes solar plants comprising the build-out scenarios occupy 7 acres per MW of installed capacity. Solar plant sizes in the build-out scenarios, as well as figures presented for solar generation, are in terms of AC (alternating current) MW. Photovoltaic panels are assumed to be of standard crystalline silicon manufacture. Panels are assumed to be fixed south facing and tilted at latitude. While panel orientation and tracking capability are key factors in the determination of avoided costs, these attributes are of lesser importance with respect to the variability and uncertainty driving integration costs. Illustrations and data summarizing the solar production of the studied build-outs are provided in Appendix 1. SrRrsncAL-BASED Atrllysrs oF Solan CnanecrERISTIcs The intent of the statistical-based analysis of solar characteristics is to translate solar's variability and uncertainty into an increased requirement for ancillary services, where ancillary services in this context relate to the electrical system's capacity to maintain a balance between customer demand and generation. For the study, the variability and uncertainty associated with solar generation were viewed from the perspective of hour-ahead scheduling of the Idaho Power system. There are three critical elements from this perspective: 1. Forecast hourly average solar production for the operating hour being scheduled 2. Lower bound for instantaneous solar production during the operating hour 3. Upper bound for instantaneous solar production during the operating hour From the perspective of real-time generation scheduling in practice, the lower and upper bounds would be considered an interval or band on solar production, and the occurrence of Exhibit No. 1 Case No. IPC-E-I4-18 P. DeVol, IPC Page 10 of36 Page 8 ldaho Power Company Solar lntegration Study Report solar production outside the interval at any moment during the hour is highly unlikely. Moreover, while under prudent operating practices the occurrence of solar production outside the lower and upper bounds should be infrequent, occasional solar excursions outside these bounds do not necessarily bring about events for which system reliability is jeopardized. Conversely, the occurrence of solar production within the interval between the lower and upper bounds would be considered likely enough to warrant the scheduling of dispatchable generators to have capacity to respond if solar production varies during the hour from the forecasted level of production toward either bound. An understanding of Idaho Power's participation in the regional electric power market is critical to this approach. Idaho Power primarily participates in the Pacific Northwest's Mid-Columbia (Mid-C) electric power market. The company participates in the Mid-C market at multiple time frames ranging from years or months in advance for long-term operations planning to hour-ahead generation scheduling in real time. The focus for this study is the real-time market activities occurring as part of hour-ahead system scheduling. The study assumes hour-ahead schedulers require the delivery of forecast hourly average solar production and the above-described lower and upper bounds 45 minutes prior to the start of the operating hour being scheduled. Hour-ahead scheduling is assumed binding, and unexpected conditions occurring during the operating hour being scheduled must be managed by changing production for Idaho Power-owned dispatchable resources. Idaho Power recognizes efforts to establish intra-hour trading in U.S. electric power markets. However, company experience has shown the intra-hour market to be currently highly illiquid. Therefore, the last opportunity to participate in the electric power market is at the hour-ahead time frame; unexpected conditions occurring during the operating hour (e.g., unexpected levels of solar production) cannot be managed through market activity at this time. Hour-Ahead Solar Production Forecast The hour-ahead solar production forecast was developed to predict hourly average solar production for the operating hour being scheduled and lower and upper bounds for instantaneous solar production during the operating hour. This forecast was developed using a persistence-based technique that relies on observations from the previous hours to inform the model about subsequent forecast hours. The results ofthe forecast are a unique set of values (average production, upper bound, and lower bound) for every hour in the year. The average production forecast is derived based on two components. The first component accounts for the amount of generation the system observed from the last 20 minutes of the preceding forecast hour. This component is referred to as the persistence component. The persistence component serves as a mechanism to increase the average forecast during times of high solar production and decrease the average forecast during times of low solar production. These increases and decreases are made to the forecast hourly and account for changes in solar production. [n general, the shape of the production from a solar photovoltaic system increases before solar noon and decreases after solar noon. Every day ofthe year has a unique clear-day shape. Generally, slunmer days are long and have a high potential for solar production while winter days are shorter and have less potential. The forecast accounts for the uniqueness of each Page 9 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 11 of36 Solar lntegration Study Report ldaho Power Company day by applyrng an hourly shaping factor. This shaping component, or shaping factor, is a unique value for every hour in the year. The shaping component is a ratio of the maximum solar potential of the forecast hour divided by the maximum potential of the previous hour. By utilizing a shaping component and a persistence component, the average production forecast captures hourly changes due to atrnospheric conditions and seasonal effects. Table 5 provides the forecast error for the hour-ahead solar production forecast. Table 5 Forecast error for the hour-ahead solar production forecast 100 Mw 300 Mw 500 Mw 7OO MW Absolute Mean Hourly Error (MW)12.2 Table 5 reports the absolute mean error calculated on an hourly basis for water year 2012. The absolute hourly error is calculated as the absolute difference between the average hourly forecast and the average of S-minute observed production data for a given hour. It is noted that the S-minute observed production data is the output of the WVM. The absolute mean hour errors range from 1.9 MW to 12.2 MW for the 100 MW and 700 MW build-out scenarios, respectively. The lower bound for instantaneous solar production during the operating hour is forecasted as a percentage ofthe forecast average. In addition to the application ofa percentage ofaverage, the forecasting tool adjusts the lower bound forecast upward if the previous lower bound forecast was substantially too low. As a result of this secondary adjustment to the lower bound, the amount of incremental capacity held in reserve for the coming hour is reduced. Similar to the lower bound, the upper bound for instantaneous solar production during the operating hour is forecasted as a percentage ofthe forecast average. In addition to the application of a percentage of average, the forecasting tool adjusts the upper bound forecast downward if the previous upper bound forecast was substantially too high. As a result of this secondary adjustment to the upper bound, the amount of decremental capacity held in reserve for the coming hour is reduced. The upper and lower bounds are expected to capture the overwhelming majority of the variability observed in solar production. The upper bound is forecasted in such away that only 2.5 percent of all observations exceed the upper bound for the entire year. Similarly, the lower bound is defined in such a way that only 2.5 percent of all observations are below the lower bound for the entire year. The hour-ahead forecast for the average production, lower bound for instantaneous solar, and upper bound for instantaneous solar are calculated for every hour of the year. The amount of incrernental capacity held in reserve for a given hour is calculated as the difference between the average production forecast and the lower bound. The amount of decremental capacity held in reserve for a given hour is calculated as the difference between the average production forecast and the upper bound. The total amount of capacity held in reserve for a given hour is used by the production cost model to calculate an integration cost. These reserve amounts, as well as the hour-ahead forecast for solar production, are input to the production cost model on an hour-by- hour basis, simulating the practice of real-time generation scheduling. Table 6 reports the 9.65.81.9 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 12 of36 Page 10 ldaho Power Company Solar lntegration Study Report forecasted amount of capacity held in reserve for water year 2012. Further explanation of the derivation of the hour-ahead solar production forecast and the lower and upper bounds is provided in Appendix 1. Table 6 Forecasted incremental and decremental capacity held in reserve, water year 2012 Solar Build-Out Scenarios 100 Mw 300 Mw 500 Mw 700 Mw Average hourly production (MW) Average hourly capacity held in reserve-incremental (MW) Average hourly capacity held in reserve{ecremental (MW) 17.O 4.9 4.9 s2.5 13.2 15.2 89.0 21.2 26.9 118.2 27.6 34.8 PnooucroN Cosr Sruru lanoN ANALysrs The production cost simulations are designed to isolate the effects on the system associated with integrating solar. Under this design, production cost simulations are paired into a base case and test case, with all inputs to the paired simulations equivalent except an amount of capacity held in reserve in the test case simulation for integrating solar. The capacity held in reserve for the test case varies hourly depending on the hour-ahead forecast ofsolar production for a given operating hour and the lower and upper bounds on instantaneous solar production for the operating hour. The derivation of the hour-ahead solar production forecast and the lower and upper bounds is described in the previous section of this report. Design of Simulations The production cost simulations are set up on a water-year calendar, where by convention a water year is from October I to September 30 and is designated by the calendar year in which the l2-month period ends. For example, water year 2013 is the l2-month period from October l, 2012, throttgh September 30, 20 1 3. The Idaho Power generating system as it exists at the time of issue of this report is assumed for the production cost simulations. Critical elements of the simulated system of generating resources include 17 hydroelectric facilities totaling 1,709 MW pf nameplate capacity, 3 coal-fred facilities totaling 1,118 MW of nameplate capacity, and 3 natural gas-fired facilities totaling 762MW of nameplate capacity. An illustration of the generating resources is provided inAppendix 1. Idaho Power's critical interconnections to the regional market are over the Idaho-Northwest, Idaho-Utah (Path C), and Idaho-Montana paths. For the solar integration study modeling, the separate paths were combined to an aggregate path for off-system access. Purchases from the regional market are treated separately from sales to the regional market. Net firm purchases from the market are limited on a monthly basis to only the capacity and energy required to serve Page 11 exniOit t,to. t Case No. IPC-E-14-18 P. DeVol, IPC Page 13 of36 Solar lntegration Study Report ldaho Power Company Idaho Power's retail load. Sales to the market are limited to 500 MW in every hour. This profile of purchases and sales reflects the current capabilities of Idaho Power's transmission system. Idaho Power is pursuing the development of the Boardman to Hemingway Transmission Project (B2H), which will increase ldaho Power's access to the Northwest to make additional purchases and sales. However, the transmission line's current in-service date is at least five years into the future. Previous integration studies have shown that unless there is a liquid capacity balancing market, B2H will not significantly impact the solar integration cost. Idaho Power is actively engaged in regional market discussions that could exist when B2H is completed, but the benefits of a market are highly dependent on its design, and it is premature to speculate or incorporate in this integration study. Simulation Inputs Table 7 provides key inputs to the solar integration study production cost simulations. Table 7 lnputs for the solar integration study production cost simulations lnput Assumed input level Solar production Snake River streamflows Customer demand Nymex-Natural gas prices Mid-C-Electric power market prices Non-wind PURPA1 Wind (PURPA and PPA)1 Geothermal PPAs Waler year 2012 Water year 2012 (median-type streamflows) Waler year 2012 Waler year 2012 Water year 2Q12 Water year 2012 Water year 2013 Waler year 2014 I PPA and PURPA represent facilities from which generation is contractually purchased as a power purchase agreement (PPA) or under the federa,l Public Utility Regulatory Policies Act of 1978 (PURPA). The selection of water year 2012 for the majority of the inputs was driven by the selection of Snake River streamflows for water year 2012 (October 1, 201 l-September 30,2012) and the objective to use time-synchronous input data to the greatest possible extent. Snake River Basin streamflow conditions as observed in water year 2012 were selected because the observed water year 2012 Brownlee reservoir inflow volume of 1 3.6 million acre-feet is representative of median-type streamflow conditions. A graph of Brownlee inflow volumes for water years 1990 to 2013 is provided in Appendix 1. The solar production data used in the production cost simulations are considered to be the solar production that would have been observed during water year 20l2had the four studied solar build-out scenarios existed. As described previously, the solar production data is developed by applylng a wavelet smoothing transformation technique to S-minute interval AgriMet and SolarAnywhere data. Importantly, the use of observed customer demand from water year 2012 allows time synchronization between solar and customer demand data in the study. While customer demand has grown since 2012, the benefit of using time-synchronous Exhibit No. 1 Case No. IPC-E-'|4-18 P. DeVol, IPC Page '14 of 36 Page 12 ldaho Power Company Solar lntegration Study Report customer demand and solar production data is considered to justi$ the use of 2012 customer demand data. Monthly average customer demand used in the modeling is provided in Appendix 1. Water year 2012 Nymex natural gas prices and Mid-C electric power market prices are inputs to the simulations. These prices, expressed as a monthly average, are provided in Appendix l. Wind capacity under contract with Idaho Power grew by more than 60 percent during water year 2012, expatding from 395 MW of installed capacity to 638 MW. Because of the non-constant amount of on-line wind capacity during water year 2012,the simulations used observed hourly wind production data for water year 2013. The amount of on-line wind capacity during water year 2013 changed only by the addition of a single 40 MW project added during December 2013 that brought wind to the current on-line capacity of 678 MW. Monthly energy production used in the modeling is included in Appendix l. The remaining energy purchased from non-wind PURPA quali$ing facilities is input into the simulations as observed during water year 2012.The monthly energy from the non-wind PURPA facilities in included in Appendix l. Baseload generation from geothermal facilities contractually selling to Idaho Power under PPAs is input as currently projected from these facilities. The amount of baseload generation delivered from these facilities varies seasonally. The amount used in the production cost simulations ranges fromZ2 MW to 32 MW. Simulation Model Idaho Power used an internally developed system operations model for the solar integration study. The model determines optimal hourly scheduling of dispatchable hydro and thermal generators with the objective of minimizing production costs while honoring constraints imposed on the system. System constraints used in the model capture numerous restrictions governing the operation of the power system, including the following: o Reservoir headwater constraints o Minimum reservoir outflow constraints o Reseryoir outflow ramping rate constraints o Generator minimum/maximum output levels o Marketpurchase/saleconstraints o Generator ramping rates The model also stipulated that demand and resources were exactly in balance and importantly that hourly reserve requirements were satisfied. The extra capacity in reserve held to manage variability and uncertainty in solar production drives the production cost differences between the Page 13 Exhibit No. 1 Case No.|PC-E-14-18 P. DeVol, IPC Page 15 of36 Solar lntegration Study Report ldaho Power Company study's two cases. The derivation of the extra capacity in reserve held for solar is described previously in this report. Wind and Load Reserves Capacity in reserve to manage variability and uncertainty in load and wind is included in the simulations in equivalent amounts for the study's two cases. By carrying equivalent amounts in reserve for load and wind, the production cost differences yielded by the study's simulations can be attributed to the extra capacity held in reserve for solar. Thus, while reserves carried for load and wind are not drivers of production cost differences in the paired simulations, it is nevertheless desirable in simulating the system as accurately as possible to incorporate reserve levels for load and wind representative of levels carried in practice. To manage variability and uncertainty in load, capacity in reserve equal to 3 percent of load is held on dispatchable generators in the modeling for the solar integration study. The amount of simulated capacity in reserve for balancing wind is based on an analysis performed for the Idaho Power wind integration study as described in the February 2013 Wind Integration Study Report (Idaho Power 201 3). The simulated reserves for the solar integration study are based on a scaling of the reserves at the wind study's 800 MW wind build-out scenario to the water year 2013 wind build-out of 678 MW. Conti ngency Reserve Obl igation The study of integration impacts and costs focuses on the need to carry bidirectional capacity in reserve for maintaining compliance with reliability standards. However, balancing authorities, such as Idaho Power, are also required to carry unloaded capacity in reserve for responding to system contingency events, which have traditionally been viewed as large and relatively infrequent system disturbances affecting the production or transmission of power (e.g., the loss of a major generating unit or major transmission line). System modeling for the solar integration study imposes a contingency reserve intended to reflect this obligation equal to 3 percent of load and 3 percent of generation, setting aside this capacity for both study cases (i.e., base and test). Flexible Capacity Resources As described previously, the focus of the production cost simulations for the solar integration study is the real-time market activities occurring as part of hour-ahead system scheduling. The study assumes hour-ahead schedulers require the delivery of forecast hourly average solar production and the lower and upper bounds for solar production 45 minutes prior to the start of the operating hour being scheduled. Hour-ahead scheduling is then assumed binding, and unexpected levels of solar production occurring during the operating hour being scheduled must be managed by Idaho Power's system. To manage deviations in solar production from the forecast during the operating hour, Idaho Power must schedule incremental and decremental capacity in reserve on dispatchable generators. ln the modeling for the study, this capacity in reserve is scheduled on Hells Canyon Complex (HCC) hydroelectric generators (Brownlee, Oxbow, and Hells Canyon), natural gas-fired generators (Langley Gulch, Danskin, and Bennett Mountain), and Jim Bridger Exhibit No. 1 Case No. IPC-E-14-'18 P. DeVol, IPC Page '16 of 36 Page 14 ldaho Power Company Solar lntegration Study Report coal-fired generators. The allocation of reserve to these generators matches ldaho Power's practice for balancing variations in wind production and load. Resulrs The objective of the Idaho Power solar integration study is to determine the costs of the operational modifications necessary to integrate solar photovoltaic power plant generation. The integration costs are driven by the need to carry extra capacity in reserve to allow bidirectional response from dispatchable generators to unplanned excursions in solar production. The simulations performed for the Idaho Power solar integration study indicate the following costs associated with holding the extra capacity in reserve (Table 8). The provided costs are the costs to integrate solar production for calendar year 2014, and are not costs averaged or levelized over the life of a solar power plant. Table 8 Average integration cost per MWh for solar build-out scenarios 0-100 Mw 0-300 Mw 0.500 Mw 0-700 Mw lntegration cost $0.40/MWh $1.20l[4vvh $1.80/MWh $2.50/trwh Note: Costs are in 2014 dollars and rounded from simulation results to the nearest $0.10. The integration cost results in Table 8 are the cost per MWh to integrate the full installed solar power plant capacity at the respective scenarios studied. For example, the integration cost results indicate the total solar power plant capacity making up the 500 MW build-out scenario brings about costs of $1.80 for each megawatt-hour (MWh) integrated. Integration costs can be expressed altematively in terms of incremental costs. Integration costs when expressed incrementally assume early projects are assessed lesser integration costs, and later projects need to make up the difference to allow full cost recovery for a given build-out scenario. For example, if solar plants comprising the first 100 MW build-out are assessed integration costs of $0.40/MWh, then plants comprising the increment between 100 MW and 300 MW need assessed integration costs of $1.50/MWh to allow full recovery of the $1.2OllVIWh costs to integrate 300 MW of solar plant capacity. lncremental solar integration costs are provided in Table 9. Table 9 lncremental integration cost results for solar build-out scenarios 0-100 Mw 100-300 Mw 300-500 Mw 500-700 Mw lncremental integration cost $0.4O/tvfvvh $1.s0/tvlvvh $2.80/11/Wh $4.40/tvlvvh Note: Costs ate in 2014 dollars and rounded from simulation results to the nearest $0.10. Page 15 Exhib1 No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 17 of 36 Solar lntegration Study Report ldaho Power Company Study Findings Hour-Ahead SoIa r Production Forecasting Analyses suggest a persistence-based forecast with adjustment to account for known changes in the sun's position provides a reasonable production forecast for hour-ahead operations scheduling. The persistence-based hour-ahead solar production forecast used for the study is based entirely on observed production and consequently could be readily adopted in practice. While a day-ahead solar production forecast would be necessary in practice for a balancing authority integrating solar, deviations from the day-ahead forecast can be managed through a combination of market transactions and operations modifications, and consequently the study imposes no reserve requirement to cover deviations for day-ahead solar production forecasts. Compared to wind, system operators managing a balancing authority integrating solar would have the benefit of at least six hours at the start of day with no or liftle solar production. During this period of no or little solar production, system operators could evaluate the day-ahead solar production forecast using information from updated weather forecast products and begin to plan for necessary actions to manage deviations from the day-ahead solar production forecast. In contrast, deviations from the hour-ahead solar production forecast can only be covered by ldaho Power's dispatchable generators. The analysis for the solar integration study by design determines the amounts of bidirectional capacity in reserve that system operators would need to schedule to position dispatchable generators to cover possible deviations from the hour-ahead solar production forecast. lntegration costs are a result of the sub-optimal scheduling of the dispatchable generators associated with holding the solar-caused capacity in reserve. Comparison to Wind lntegration This study indicates solar plant integration costs are lower than wind plant integration costs. The lower integration costs associated with solar are fundamentally the result of less variability and uncertainty. As described in the preceding section, the study assumes deviations in solar plant production from day-ahead forecast levels can be managed through a combination of market transactions and operations modifications, allowing day-ahead generation scheduling to avoid extra reserve burden. Therefore, reserves carried for solar generation can be focused on readying dispatchable generators to respond to unplanned solar excursions from hour-ahead production forecasts. Moreover, logic incorporated in the derivation of lower and upper bounds on the hour-ahead production forecast, which can be readily adopted in practice, allows the adjustrnent ofthe bounds in response to observed solar production patterns. ln effect, the hour-ahead forecast is based on a persistence oflevel ofproduction (adjusted for the known change in the sun's position), as well as a persistence of variability in production. The consequence of these methods is that bidirectional capacity held in reserve on dispatchable generators to respond to solar variability and uncertainty is less than that required for responding to wind. Qualitatively, solar is more predictable than wind. Sunrise and sunset times, as well as the time of solar noon, are a certainty. The theoretical maximum level of production can be Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,lPC Page 18 of36 Page 16 ldaho Power Company Solar lntegration Study Report readily derived, reflecting patterns on daily, monthly, and seasonal time scales. Finally, land requirements for a solar power plant are likely to promote a relatively high level of dispersion, which is critical to the mitigation of impacts from severe and abrupt ramps in production exhibited by individual panels in response to passing clouds. The effects of geographic dispersion are discussed further in the following section. Geographic Dispersion Production for a single solar photovoltaic panel exhibits severe and abrupt intermittency during variably cloudy conditions; a TRC member expressed during a meeting that for a single panel, the drop in production from a cloud is effectively instantaneous. The effect of severe and abrupt intermittency is commonly attributed to the absence of inertia in the photovoltaic process. While the intermittency effect is severe for a single panel, dampening occurs when considering the production from a solar plant-sized aggregation of panels, and even further dampening occurs when considering the production from several solar plants spread over a region such as southern Idaho. Therefore, geographic dispersion has significant influence on solar integration impacts and is perhaps of greater importance for solar than wind. The four studied solar build-out scenarios each have capacity installed at six southern Idaho locations spread over more than220 miles from east to west. Because of the substantial geographic dispersion, severe instantaneous ramps in solar production for the study data are relatively infrequent. If solar plant development in southem Idaho occurs in a more clustered fashion than assumed for this study, actual integration impacts and costs will be higher than the results of this study. Transmi ssion and Di stribution The focus of ldaho Power's solar integration study is a macro-level investigation of the operations modifications necessary to maintain balance between power supply and customer demand for a balancing authority integrating photovoltaic solar plant generation. The objective is to understand the impacts and costs of the sub-optimal operation of dispatchable generating capacity. The study is not an investigation of integration issues related to the delivery of energy from proposed solar photovoltaic power plants to the retail customer; these issues are addressed in individual interconnection studies performed on a plant-by-plant basis. Sprng-Season Integration The production cost simulations suggest reserve requirements are particularly problematic when hydroelectric resources are highly constrained, such as frequently occurs during spring-season periods charactenzed by high water, low customer demand, and high generation from variable generating resources, such as wind and solar. Experience has shown wind integration to be particularly challenging during these periods, and the simulations suggest similar challenges integrating solar. This study finding is corroborated by NREL in the Western Wind and Solar Integration Study Phase 2 (Lew et al. 2013), which reports the need for flexibility is notably high during the spring and that during these periods the curtailment of variable generation is one source of flexibility enabling the balancing of generation and customer demand. Page 17 Exhibit No. ,l Case No. IPC-E-14-'t8 P. DeVol, IPC Page 19 of 36 Solar lntegration Study Report ldaho Power Company Gottcr-usroNS The cost to integrate the variable and uncertain delivery of energy from solar photovoltaic power plants is driven by the need to carry extra capacity in reserve. This extra capacity in reserve is necessary to allow bidirectional response from dispatchable generators to unplanned excursions in solar production. The simulations performed for Idaho Power's solar integration study indicate the costs associated with holding the extra capacity in reserve (Table 8). Further Study The integration of variable generation, including the study of methods for determining integration impacts and costs, continues to be the subject of considerable research. The breadth of this research highlights the interest in variable-generation integration, as well as the evolution of study methods. Idaho Power appreciates the level of interest in its study of integration of variable generation and recognizes the likelihood of a second-phase study with expanded scope. During the course of the solar integration study, in discussions with the TRC and participants of the public workshop, Idaho Power has received suggestions for a second-phase study of solar integration. Suggestions for a second phase include the study of the following: o Alternative water-year types (e.g., low-type and high-type) r lntra-hourtradingopportunities o Shortening the hour-ahead forecast lead time from 45 minutes to 30 minutes o Clustered solar build-out scenarios o Smaller solar build-out scenarios (e.g., 50 MW of installed capacity) . Other solar plant technologies (e.9., tracking systems or varied fixed-panel orientation) e Distributed solar systems (i.e., rooftop systems) o Correlation between solar, wind, and load variability and uncertainty r Improved forecasting methods o Energy imbalance markets o Voltage/frequencyregulation Idaho Power will consider these suggestions during the development of scope for a second-phase study. Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 20 of 36 Page 18 ldaho Power Company Solar lntegration Study Report LTeRRTURE Creo Ela 8., M. Milligan, B. Parsons, D. Lew, and D. Corbus. 2009. The evolution of wind power integration studies: Past, present, and future. IEEE Power & Energy Society General Meeting,2009 PES '09. Idaho Power.2013. Wind Integration Study Report. Boise, ID: Idaho Power. Lave, M., A. Ellis, and J. Stein. 201 3a. Simulating solar power plant variability: A review of current methods. Sandia report-SAND20l3-4757. http://enersy. sandia. gov/wp/wp-contenVgallery/uploads/SAND20 I 3 - 4757-simulatine_Solar Power_Plant_Variability A_Review olCurrent_Methods FI NAL.pdf. Accessed June 2014. Lave, M., J. Kleissl, J. S. Stein. 2013b. A wavelet-based variability model (W\IM) for solar PV power plants. IEEE Transactions on Sustainable Energy, Vol. 4, No. 2. Lew, D., G. Brinkman, A. Ibanez, A. Florita, M. Heaney, B. M. Hodge, M. Hummon, G. Stark, J. King, S. A. Lefton, N. Kumar, D. Agan, G. Jordan, and S. Venkataraman.2013. Western Wind and Solar lntegration Study Phase 2. NREL/TP-5500-55588. Golden, CO: National Renewable Energy Laboratory. http://www.nrel.gov/docs/fy13osti/55588.pdf. Accessed June 2014. [IVIG and NREL]. Utility Variable-Generation Integration Group and National Renewable Energy Laboratory. No date. Principles for Technical Review Committee (TRC) involvement in studies of variable generation integration into electric power systems. http:llvaiablegen.org/wp-content/uploadsl2009l05/TRCPrinciplesJune2012.pdf. Accessed June 2014. Page 19 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 21 of36 Solar lntegration Study Report ldaho Power Company This page left blank intentionally. Page 20 Exhibit No. 1 Case No.IPC-E-14-18 P. DeVol,lPC Page 22 of 36 ldaho Power Company Solar lntegration Study Report Appendix 1 Solar integration study appendix Table of Contents lntroduction Technical Review Committee List of TRC Members Regulatory Commission Staff Observers TRC Schedule and Agenda Public Workshop Schedule and Agenda Data Inputs and Assumptions Natural Gas Price Assumptions Market Power Price Assumptions IPC Customer Load Data Idaho Power Existing Generation Hydroelectric Generation Data Run-of-River Projects Wind Generation Data Aggregate PPA and PURPA Projects Non-Wind PLIRPA Generation Data Solar Production Data Derivation of Hour-Ahead Solar Production Forecast and Upper/Lower Bounds Page 21 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 23 of 36 Solar lntegration Study Report ldaho Power Company !rurnooucnoN This appendix contains supporting data and explanatory materials used to develop Idaho Power's 2014 Solar Integration Study. The main document, the 2014 Solar Integration Study, contains a full narrative of Idaho Power's process for studying solar integration costs. For information or questions concerning the study, contact ldaho Power: Idaho Power-Resource Planning l22l W. Idaho St. Boise,Idaho 83702 208-388-2623 Tecn rurcAL Reuew Gorvrlurree The Technical Review Committee (TRC) was formed during summer 2013 to provide input, review, and guidance for the study. It is comprised of participants from outside of Idaho Power that have an interest and/or expertise with the integration of intermittent resources onto utility systems. As part of preparing the 2014 Solar Integration Study,Idaho Power held one public meeting and four TRC meetings. Idaho Power values these opportunities to convene, and the TRC members have made significant contributions to this plan. List of TRC Members Brian Johnson...................University of Idaho Jimmy Lindsay.................Portland General Electric (formerly of Renewable Northwest Project) Kurt Myers ....Idaho National Laboratory Paul Woods ...(formerly of City of Boise) Cameron Yourkowski......Renewable Northwest Project (replacing Jimmy Lindsay) Reg ulatory Commission Staff Obseruers Brittany Andrus................Public Utility Commission of Oregon (OPUC) staff John Crider ....OPUC Staff Rick Sterling....................Idaho Public Utilities Commission (IPUC) staff Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 24 of 36 Page22 ldaho Power Company Solar lntegration Study Report TRC Schedule and Agenda Meeting Dates 2013 Thursday, August 15 2013 Thursday, September 19 2014 Monday, January 6 2014 Friday, May 16 2014 Thursday, May 29 Agenda ltems lntroductions and role of TRC ldaho Power system overview Formulation of basic study design Establish solar futures Techniques for building solar generation data Closing thoughts and comments Study design Key study components Hydro-WY 2011 vs. WY 2012 vs. WY 2013 Solar-WY 2011 vs. WY 2012 vs. WY 2013 Market power prices Natural gas prices Solar penetration levels Review of Study Design Solar Data Availability Wavelet-based Variability Model Analysis Conclusions Review of lntegration Study Design Review of IPUC Filing Development of Reserve Requirement for solar scenarios Review of Operating Reserves Review of Production Cost Model Agenda ltems lntroduction of Technical Review Committee ldaho Power system overview Study objective Study design System modeling Next steps Public Workshop Schedule and Agenda Meeting Dates 2014 Thursday, May 1 Page 23 Exhibit No. 1 Case No. IPC-E-I4-18 P. DeVol,lPC Page 25 of 36 Solar lntegration Study Report Natural Gas Price Assumptions Table I Actual monthly average Nymex price for waler year 2012 Average Monthly Price 2011 Dara lnpurs AND AssurrlpnoNs $3.76 $3.52 $3.36 $3.08 $2.68 $2.4s $2.19 $2.04 $2.43 $2.77 $3.01 $2.63 $26.02 $30.81 $30.13 $24.53 $23.50 $16.30 $8.9e $s.81 $4.50 $12.05 $24.75 $24.47 2012 October November December January February March April May June July August September October November December January February March April May June July August September Market Power Price Assumptions Table 2 Actual average Mid-Columbia dollars/megawatt-hour (MWh) for water year 2012 Average Monthly Price 2011 2012 Page24 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 26 of 36 ldaho Power Company Solar lntegration Study Report lPC Gustomer Load Data Table 3 Actual average megawaft (MW) for water year 2012 Year Month Average Load 2011 October November December January February March April May June July August September 2012 Hydroelectdc Fecllldes and ,{aneplate Capacltles E xellsGnyon 391.5Mw E OxUow Igo.OMW 1,403 1,563 1,729 1,680 1,597 1,457 1,504 1,742 2,108 2,388 2,197 1,679 ldaho Power Existing Generation E growde E c:sue E 5mtalts E c.r.st*e E Sliss I toner Malad I upperMalad @ l-owerSalmon 60.0Mw E UppsSalmon 34.5Mw @ IhourndSprings 8.8MW E Oeer Late 2.5 MW WASHINGTOI{ OREGOf, E 5h6hon€ Falls 12-5 MW @ Twin Falls GI Milner E Arerican Falls ?2:3 MlV rotal 1,709,0-v!- North \6lmy ,t.EVADA Figure 1 Existing ldaho Power generating resources Therma! Facllides And Capacltles coal A lim Bridg€r 770.5 MW' A North Valrry 283.5 MW' Eoardm.n , q!]t!: ror.l llt8,?]"r! Natud G.s BennettMountain l72.tMW Danskin 270.9 MW A bngley Gulch l1_8.s {ITotel 7.5?._2-Y! Diesel A S.lmon oie*l 5.0 MW Totrl 1,885.4 MW WYOMING 5t5.4 MW 12.i1MW 27.2 MW E2.8 MW 75.0 MW 13.5 MW 8.3 MW t" * 52.9 MW 59.4 MW Page 25 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,lPC Page 27 of 36 Solar lntegration Study Report ldaho Power Company E zs.o!o(,ItE 2o.o EEE 1s.o.oEE: 1o.otto oE s.o- ol} 1961-2O13rvcrIc 't I o WY2O12 o'01 1949 199{ Flgure 2 Brownlee Reservoir inflow by water year October November December January February March April May June July August September 447 418 415 358 365 380 388 2s2 337 292 251 208 Hydroelectric Generation Data Run-of-River Projects Table 4 Actual monthly average MW (aMW) for water year 2012 2011 2012 Page 26 Exhibit No. 'l Case No. IPC-E-14-18 P. DEVOI,IPC Page 28 of 36 ldaho Power Company Solar lntegration Study Report Wind Generation Data Aggregate PPA and PURPA Projects Table 5 Actual monthly aMW for water year 2013 Year Month aMW 2011 95 190 120 194 167 191 172 166 163 144 131 't'16 2012 Non-Wind PURPA Generation Table 6 Actual monthly aMW for waler year 2012 Year ailW 2011 October November December January February March April May June July August September Data 2012 October November December January February March April May June July August September 96 52 45 43 43 54 104 135 131 140 130 111 Page 27 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,lPC Page 29 of 36 Solar lntegration Study Report ldaho Power Company Solar Production Data rm DispoBod 100 MW: Seasonal Averago Daily Shape 90 80 -70o =*5 E* i*Iil30 N 10 0 - Smmq Av6age: J0, JLa. Aug - Spring AsAe: Mr, Apr, May - - Amud Asqe: Oct- Sep Fall Avsage: S€p, Oct, tlov 1:m 2100 3:00 4:00 5:m 6:m 7:m 8100 9:00 10:m !1:00 12:m 13m Tlm ot Day Dispe6ed I00 MW-Production 14:00 15:00 16:00 17:m 1&m 2'l:0 2:N :fi II I I I I t;, 35 30 25 )n 15 10 (J 3- "r;'i.:r1.:"1.Xl.:""1'*o"1;'"1.':1.;'*l'Figure 3 Dispersed 100 MW -d -.s -.s ..s .-"1iS*t"."';..".d Page 28 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,lPC Page 30 of 36 ldaho Power Company Solar lntegration Study Report Dispersed 300 ilW: Seasonal Ayorage Daily Shape 300 2fi m 240 m 9*t3 rso ! 160t ! r+o o2a.1tI ,00 80 60 40 20 0 -SmmAvsageJ6, Jd, Aug - Spring Avsage: Ma, Apr, May - - Am@lAsee:Ocl- S@ FallAvsage: Sfl, Ocl, Nov WinlqAvereei D€, Jil, Feb l '..a--" fi"' 0:00 1:00 2:00 3:00 4:00 6:m 7:00 8:00 9:00 10rm 11:m 12:00 13:00 14:m 15rm lom 17:m 18:00 1900 20:m 21:m Z:fi 23:n Tim of Day Dispersed 300 Mw+roduction olI*i.l Iloi go 2't 20ll rol I ,nl I I,tl oL "..::1 j"1..1i.:S.$...{]".:.."" Figure 4 Dispersed 300 MW -$ -"6 $ "9" ,."::-{".":"""""'" Page 29 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 31 of36 Solar lntegration Study Report ldaho Power Company DispeGed 500 mW: Seasonal Av.rage Daily Shape 500 450 400 _ 350o =3:ooc E*r*o!&r*.I{o- tso 100 - Smms Avsage: Jm, Jd, Aug - Sprirg Avaage: Mer, Apr, May - - AmEl Awage: Oct - S€p FallAvs46: S€p, Oct, Nov WntsAsage: Ds, Ja, Feb 6:00 7:00 8:00 9:00 10:m 11:m !2:00 13:m 14:m 15:m 1Cm 17:m 18:00 1900 20:00 21:00 Z:fi 23.@ Tlre of Day Dispersed 500 Mw-Production i oo- r,oo o =- r80 160 't40 120 100 80 60 40 20 0 36 ir IJ -\Ps -$ -$ -..s -$ -S .S -'"6 -d -"Ps -'S -S -d ".""':"-';"".{.""*':i$""":""";t.."'t.1"*t"""":".""*J" Figure 5 Dispersed 500 MW -$ -"6 -,{f -.S ,".":-"o::.t:"t"."" Page 30 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 32 of 36 ldaho Power Company Solar lntegration Study Report Di3perced 700 ilW: Seasonal Average Daily Shape - SmmdAvsee Jn, Jd, Aug i ) 7@ 650 600 s50 500 oIo,. E.*![*o ;*I{ 250 *m - SprirE Averee Ma, Apr, May i - - AnnGl Avsage: Oct- Sep ] l llFdlAvd46: Sa, Oct, Nov l l lWntsAvs4e:O€, Ja, Feb l '150 1m 50 00:00 '1:00 6:00 7:00 8:00 9:00 10:m 11:m 12:m 13:m 14:m 1500 16:m 17:00 18:00 19:m 20.@ 21tco 2:N 23tco Timof Day "';"i:::.:::.jlti..li$."..',"1.. ""$i.1;i.;1:1.r Figure 6 Dispersed 700 MW Page 31 Exhibit No. 1 Case No.|PC-E-14-'18 P. DeVol, IPC Page 33 of 36 Solar lntegration Study Report ldaho Power Company Derivation of Hour-Ahead Solar Production Forecast and Upper/Lower Bounds 95 90 85 80 75 10 =r'Ero o,-E,tu ,. 0,940 -g 3sotl30 20 15 10 0 Figure 8 Hour-ahead forecast example The average forecast is shown on Figure 8 as the green series. For each hour ofthe day, the forecast average is calculated by applying the follow equation: F'orecast AugG) : Forecast Obs(MW)1r_r,oo-r_1:1s) * Where: / : forecast hour Avg CSISg:oo+ r:55) Av g C S I S g_2:2o+r_1 :15) CS/S: Clear Sky Index Surrogate The Clear Sky Index Surrogate (CSIS) is an important measure of the maximum amount of solar generation the system could experience in any given hour. The CSIS is a component of the average solar production forecast and accounts for the seasonal changes that influence solar photovoltaic generation. This value is unique for every hour of the year. The CSIS is calculated using 5-minute, modeled production data from the wavelet-based variability model (WVM). The CSIS is calculated by taking the maximum 5-minute observation for a given hour. This maximum value is the absolute maximum for a given hour over a l0-day period. After identifying the absolute maximum from water year 2011, the forecast also identifies the absolute maxima for water years 2012 and 2013. With the three absolute maxima identified from the three water years analyzed, the forecast applies the maximum CSIS observed in three years Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol, IPC Page 34 of 36 7l8l2OL2 Page 32 ldaho Power Company Solar lntegration Study Report of data for a given hour. It is noted that the ratio of the CSIS values, described in the above equation, result in the least amount of average production forecast error. Multiple variations of this ratio were tested, and the final version of the ratio was the most accurate. The process detailing the calculation of the CSIS is described in the equations below. CSIs(r) = M ax ( [csls1r.r*, ear z07t)], [csts1r,,", y ear 2012)], [csrslr*-, ",, rorif) Where: cslSlwnt",v"o,zorr) = uax (lsminobs(MW)n,,.-r],[s*in lbs(MW)1qrr-r],...,[s*inoat{,raw)<o,r--,1) Cslslwttcrvearzorz) = uatt (ls minobs(MW),u,r-rl , [s .in obs(MW) 1r1ro-r] , ..., [s .in oAr{,raw) ro,o-*,]) cslslwatervcorzors) = uax (fs min obs(MW),r,r-rl , [s tnin obs(MW) lqro-r] , ..., [s ,in oat{,uw) <o,r-,r]) Where: f= forecast hour d= forecast day Figure 8 is a good example of how the persistence-based forecast does very well under the majority of solar conditions and how a forecasting model struggles with extreme weather events. Despite the limitations of a persistence forecast, within a short period of time the forecast returned to accurate predictions. Figure 8 is a select, extremely variable generation profile. The afternoon observations that fall beneath the lower bound forecast are included in the 2.5 percent of lower forecast error reported in the solar integration study. Generally, the forecast does well capturing the variability in production due to solar. The forecast has the ability to tighten the range between the upper and lower bounds. This ensures the amount of capacity held in reserve is sufficient but not unduly large. Page 33 Exhibit No. 1 Case No. IPC-E-14-18 P. DeVol,lPC Page 35 of 36 Solar lntegration Study Report ldaho Power Company This page left blank intentionally. Page 34 Exhibit No. 1 Case No.|PC-E-14-18 P. DeVol,IPC Page 36 of 36