Puget Sound Energy (PSE) 5.31.2024 Resource Planning Advisory Group (RPAG) Meeting

right welcome everyone we'll get started just at 10: a.m. welcome everyone including attendees in in observance today we'll start at 10: a.m. e e welcome everyone thank you for joining today Welcome to The Observers as well we'll start in two minutes welcome welcome everyone thank you for being here Welcome to our Peg members who are joining us good to see you Joel Ezra's connecting to audio get that going morning good morning happy Friday hi there stepen welcome welcome I see you and Ezra are both here glad to have you both here on this Friday morning Sophie good to see you yeah good to see you too how's the weather in Boston is it a beautiful spring gorgeous perfect perfect got some time on the tennis court this morning oh now you're just showing off that's wonderful Stephan good to see you again and Stephan remind me are you based out of the Olympia area I am based out of the Seattle area oh okay great yeah so very close to you guys so we'll give everyone a few moments here we know Fridays um Friday mornings people are getting Gathering their coffee and all that good stuff so we'll give everyone a few moments to trickle in but Welcome to The Observers thanks for being here as well Joel are you at a be Olympia area or are you also elsewhere in in the state um I was in the Olympia area now I'm based elsewhere in the state I wave to the capital and all of you who are Olympia based on my drive back from Portland this past Memorial Day weekend see there's Alisa welcome Alisa hello good to see you this morning how are you I'm doing okay thank you we're going to give everyone a few moments here um I'm going to just update your names for you just so that your affiliation is there so people the members of the public can see that so don't be alarmed if you're seeing some changes occur public Council oh wonderful we have Frey joining good good morning Frey how are you I'm good I'm have to leave a little bit maybe around noon for class yeah that's just fine thank you for being here as long as you can yeah no problem what class are you teaching today I'm teaching some Stu I'm taking some students to a biodigestor um here um welcom County oh I see one of my students on the panelist oh fun hi Nathan FR nice to see you nice see you yeah I mean ex student now yes you're Alum out in the world it's great they're always my students I feel but yeah they they're doing great things by themselves without me oh how fun how fun is that all right let's give everyone another minute here because we have represent from the UTC pH Western Washington University public Council and I see Philip's hand yeah Phillip I I just want to say thank you Frey I mean yeah it's great it's great to see uh my students out in the wild doing great things yeah I bet that's a really cool feeling as a teacher um all right well let's maybe we'll slowly get started here kind of the first few slides are just kind of our general background information so for the sake of ending on time let's officially kick this meeting off I'm Sophie glass a facilitator with triangle Associates and this is your May 31st uh resource planning Advisory Group meeting so you can go to the next slide will so as you know if you are a participant so an rpeg member you can kind of use that chat feature um for observers during the Q&A SE session um we'll be able to turn on that hand raising feature and we'll just go through people in the order in which they're called the Q&A feature is turned off um just to kind of allow this to feel like a regular meeting um and then if captions help you um if you're hard of hearing or anything that um feature is enabled so next slide so our safety moment is calling before you dig this feels particularly appropriate with spring weather and people getting out in gardens or having ambitious plans so call 811 2 to 10 days before digging or Excavating on your property and 811 will notify all the utilities in your area to Mark those lines and you can find more at digsafe w.org so I'll be thinking about that as I maybe get overly ambitious this summer um next slide please so my request as always is just be constructive and courteous if you're someone that does a lot of talking take a step back if you're someone that usually is on the side step in you know we want to hear from everyone um I'll be guiding the group trying to move us along because these are you know um publicly available and on YouTube just you know break down those acronyms if you have additional thoughts that you think of after that meeting the feedback form is a great place to drop those thoughts or if we're running really low on time we might ask some different ideas to go to that feedback form so Pauline if you could drop that there we go in the chat for you um let's try to focus on the meeting topic um just because we have a lot to cram in even though it's a three hour meeting and uh for members of the public um we look forward to hearing from you after all the presentations are done so next slide please so our speakers today this feels like it's just the family band you know it's just psse uh no guest speakers today so we have Philip popof who you know is the director of resource planning and Analytics uh Elizabeth hosner who you also know who's the manager of resource planning and Analysis Jennifer mgot who is the Consulting energy resource planning analyst Tyler Tobin who's the senior energy resource planning analyst and Nathan critchfield the associate energy resource planning analyst and also former student of Frey as we learned um welcome to Megan I just saw that you joined here we're kind of just doing our intro slides good to see you this morning so next slide please our agenda is is um we'll start off as usual with Philip just talking about what um PSC has been hearing from the public as well as from arpeg Members just kind of filling in on what what feedback you've been hearing lately um Elizabeth will intro with the electric uh analysis overview Tyler will follow up talking about the electric Price Forecast Jennifer will will uh build up on that with the electric portfolio model will take a break Nathan will continue with reference assumptions for new resources and Elizabeth will um uh lead a discussion around the sensitivity analysis and provide some information I'm going to be real strict with trying to start Elizabeth at 12:10 because this is kind of a discussion point Elizabeth is wanting to hear some feedback from you so I want to safeguard that time we'll wrap with public comment okay next slide please all right philli if you could come on screen and just share uh a summary of the feedback that PSC has been hearing than morning everybody thank you for joining us uh let's go ahead go to the next slide um you know big picture we've definitely heard feedback uh about wanting to uh wanting us to examine uh more uh types of uh of uh energy storage um and and and uh questions and issues around that I just what I would like to just make sure is clear is um the the reason why we try and simplify down to a type a representative type of of technology for different kind of energy storage classes it there's really two reasons like one is let's say long-term storage well there's a few different Technologies uh to to put them into our models right to get those into the Aurora model we need a lot of very detailed operational types of information now that's not all readily available that's one of the reasons why we hire black and& Beach to do this and they you know the more we ask them to do uh the more expensive that that their work will be um and the other piece is uh that to the extent that different resources um operate very very similarly it just comes down to the the installed cost of the resource that's what that's what will wind up making the decision on it kind of think of it as if you're playing Tetris you know what's the difference between a a green L-shaped block or a purple L-shaped block well it fits the whole just the same right and that's how Aurora is going to see it and so and then the final piece along those lines is just because we don't model five different types of of long-term energy storage Technologies it doesn't mean that we're we've we've predetermined that iron air batter is the right answer absolutely not we we will be doing um uh another RFP uh and we will be take we're not limiting the RFP to just what the IRP tested because again we don't know you know if if these things operate very similarly it just comes down to what the bids look like right just on on cost if they operate the same and we don't know what those bids are going to be we have a guess at what these things are going to cost so you know once the bids come in for real we'll analyze all of them whatever the Technologies are so I just wanted to make sure that was also clear that just because we didn't model it in the Aurora model for the IRP it doesn't mean we're somehow excluding it from consideration when we go out there to buy resources uh for real when we're when we're pinging the market thanks for that Philip any thoughts from arpeg members on that explanation great and welcome John and welcome Lauren great to see you both here um so far we've just kind of covered the public webinar feedback so anything else for Phillip to keep in mind before we move along all right you can go to the next slide please will thank you yeah thanks Philip so Elizabeth if you want to come on and we're going to start diving into the real the juicy stuff the content here o I think well if you want to click over boom there we go let you get get into full screen mode here for the perfect viewing experience okay Elizabeth take us away he thank you I'm gonna go through an overview of the electric process how we go through analysis the models we're using um and then I'm going to kind of hand it over to the team to go through some of these assumptions and the work that's been going on with the modeling um and then I'll come back at the end as we get through all the as we get through all the assumptions and the models to start talking kind of where we're going to go with the sensitivities to start testing some of these kind of what if scenarios off of some of those assumptions um so I think next slide we'll get started so in the modeling process it's kind of a multi-step process one of the first things we need to do is setting up our resource needs this is the demand forecast and our resource adequacy analysis so we've had some previous meetings on the demand forecast and that resource adequacy analysis so that work has been finished and now we're moving into kind of what we call this determining planning assumptions so this is where we're setting up all the assumptions getting the models ready to go this is a quite in-depth process to go through there's a lot of assumptions we need to get through a lot to set up the models so this is where we're going to be sitting today is just kind of going through the models we're working with all the assumptions we're going to be going and setting up we do we are going to be appreciating any feedback as we go through because this is where we're going to start actually getting things into the models and start working through everything um so if you have feedback as we go through some of these assumptions just definitely let us know also as we get to the end um as I mentioned we're going to be talking about the sensitivity analysis so once the models are set up and running we'll have the reference portfolio that's kind of our starting point portfolio and then what we do from there is we start going into the sensitivity analysis this kind of equity modeling that's the portfolio benefit analysis we'll get on in a little bit as well and that's the part where we start looking like okay if we start changing some of these assumptions how will that change the builds how will that change this portfolio and then all of that is accounted for so we start with our analysis we do all these sensitivities we're doing this portfolio benefit analysis to start bringing in equity into the modeling all of that's considered when we get to developing that resource plan so this starting point the reference portfolio is not where we're going to end up for the final resource plan it's just kind of we need a starting point we need to start somewhere to set up a reference portfolio and then start working through our analysis from there so that's a lot to keep in mind as we start going through this um and then as we get into the sensitivities we'll want to have a discussion about where we should be going with this and how we should be looking at it as well and then once we have that final resource plan the last step is to include that 10year clean energy action plan and then that will lead into what would be the um CIP after that the clean energy implementation plan so kind of ends up being a little bit of a circle as well so I think next slide this slide is just going to set us up for where we are today it's a bit of an in-depth slide of all the work this is all the work that's going into setting up our analysis the models we're using where we're using inh house modeling work and where we're bringing in some Consultants to do some other analysis for us to bring into the modeling work so as you can see there's like the highlighted purple boxes that say Aurora that's really a lot where we're going to sit we're going to be looking at the price forecast so Tyler will be taking us through that first Price Forecast um and that'll be setting up that deterministic price forecast we have the natural gas prices going in there the hydro shapes and then once we've set up that electric Price Forecast that becomes an input into our portfolio model so we have Aurora is used two different ways the first one being to set up the electric Price Forecast we'll go through that and the second one is like a psse view looking at just our portfolio and optimizing out our portfolio so then Jennifer will be going through that piece of the modeling as well and how the portfolio modeling is working um that's where we'll be sitting there's the other pieces I'll also be talking about sensitivity analysis we also have this portfolio benefits analysis Equity um we have a couple meetings coming up in June where we'll actually be going diving into that Equity analysis and how that's coming into the IRP as well so we're mostly focusing on the portfolios the electric prices today uh but there is definitely more to come all of these pieces um will have their own little conversations that's it's a lot going into these models um but definitely give us our your feedback um ask some questions we'll be kind of diving into a lot of the work that's been going on and ongoing work right now as well thanks thanks Elizabeth oh good I see a hand from Joel go ahead Joel yeah thanks um and thanks Elizabeth for walking through this um I was just curious because we've we've talked a lot about resource adequacy it seems like this this cycle um haven't E3 at a lot of these rpeg meetings to talk about that and elcc and how that how different resources are likely to fit into meeting Peak need um don't remember hearing as much about the flexibility analysis so I'm wondering if you could just speak a little bit more to what that is at a high level and kind of what if any changes to that approach have um psc's been been doing this this cycle or maybe that's still an analysis to come not sure where you're at in in that process that flexibility analysis is still a work in progress right now so more to come on that uh high level what that's trying to do is when we look at our portfolio expansion model it is an hourly model and so it's not picking up nuances of what could happen within the hour with ramping of resources some ancillary Services of those resources like how can they uh meet balancing within the hour um and flexibility so that's a more to come um analysis and what we're trying to do in that one is setting up to look within the hour this is looking at like a 15 minute Mark of how resources can be redispatch how they can meet certain aspects of flexibility and be moved around within the portfolio as loads or um other generating resources like wind and solar their generation could change um for meeting those demands so we don't have anything on flexibility analysis now and that is definitely a more to come um this time we have hired that out to an external for Consulting work um similar to what we do with E3 for resource adequacy so um once that analysis is finished we'll share what we have I hope that answered the question yeah it does um I I think in the past that's been something you've done internally through plexus if I recall correctly so that moving it to an external uh be seems like the main change it sounds like at this point yes so that that's a these benefits that that come out of that analysis will get applied um to the generic resources is is that okay and then that'll go into sort of the lowest cost portfolio that comes out of the the aora model right yeah yes so the idea is when we redispatch the resources we'll see benefits in the portfolio so for example if you put a battery in maybe you won't be doing so much um cycling of the simple cycle peers um and that could be a benefit to the portfolio so we'll see that come out as a benefit um and then that goes into our portfolio model that benefit onto those resources as part of the decision variables for choosing different resources great thank you looking forward to hearing more later at a later date great thanks for the question Joel and I Ezra's hand go ahead Ezra uh thank you so um I this is sort of a general question so I thought I'd ask it for the this General slide although I think it applies to a lot of the discussion which is that um you know Aurora and models like it um are based on a fairly static view or very static view of the transmission system and we learned a few meetings ago that the transmission expansion is just such a a critical issue both for meeting expected growth in load but especially for meeting clean energy uh requirements so I'm wondering uh you know overall maybe this isn't the time to discuss it but how uh transmission expansion or reconductoring will be uh handled as a you know one of the options for um meeting load and changing the you know the possible resource mix to coste effectively meet load and clean energy requirements that is correct so uh the portfolio expansion model it's a generation expansion model there are separate models that do like transmission expansion but they do we don't have there's no combined model and so what we do is we work with the transmission team we've put together several different sensitivities so I'll go through the list of sensitivities and we work with them they get us information it's kind of like a back and forth so they'll get us information we'll run the sensitivity see how this works um so we're setting up to run through different iterations of different possible transmission Solutions so there will be sensitivities for like reconductoring things like that yeah they going to start running some sensitivities less more transmission things like that thank you Elizabeth for um thanks Ezra for for these um kind of forthcoming topics you it's fine to say we don't know but do you have any sense of which upcoming arpeg meetings there might be information for the group to hear about these issues or topics um H we are still working out the rest meeting agenda so I do know the June meetings coming up are on the equity analysis um I have not thought beyond the June meetings we're still working through some of that yes only if you had an had an answer on the top of the your fingers that's fine um okay very good well thank you for those questions Ezra and Joel anyone else have a big picture question overall in the electric modeling process oh and I did want to clarify start Ezra I misspoke so for our transmission assumptions um reconductoring is something separate we are looking at um expansion of the trans Regional transmission system so those are the sensitivities we're looking at so I just want to make sure I was clear about that someone pointed that out that I might not have been so clear great I see so that's that's reconductoring is not one of those or not a part of that it's just building new stuff yes correct thank you thanks for clarifying Elizabeth all right anyone else before we move along here well thank you Elizabeth it very I mean you know me I'm so visual it was really helpful to kind of see the flowchart there and the timeline the way you had it so thanks for that and we'll move on to our next slide now all right Tyler take us away hey good morning everyone uh so I'm going to talk about our electric Price Forecast and on Elizabeth's slide uh I believe she referred to it as the power Price Forecast so those are kind of interchangeable terms um I don't know I learned electric price forecast so that's what I'm going to call it for this chunk of slides but uh it fits into those power Price Boxes that Elizabeth had on the last overall flowchart um I don't have any specific break points for questions so um feel free to put hands up as questions arise and I'm sure Sophie will get my attention uh next slide please all right so electric Price Forecast um in the context of the IRP as Elizabeth mentioned this is a a model we run through Aurora and it's separate from our psse specific portfolio model uh we run this for the entirety of the W um so we have every generator every balancing Authority modeled um and by doing that we're trying to simulate market conditions across the entire region um so we can take those market prices uh extract them from this really massive model and put them into our portfolio model which is a very detailed look at psc's generation needs uh so to do that we start with an input database and we collect this from energy Exemplar who is the software vendor for the Aurora software um they produce a database that you know gives us a really strong starting point they've done all the hard work of tracking down all those generators and transmission assumptions uh um we take that database that's you know updated every couple of years and we try to make it fit our expectations for the Pacific Northwest uh the best we can so we update a number of data inputs including uh a regional demand forecast a hydro forecast natural gas price forecasts any Queen energy targets uh we take a look at all those resources and try to add any new builds or retirements that have been announced since database was published and we make any like legislative updates so in this case we've included a carbon price um to take the raw energy Exemplar database make a bunch of updates run that through Aurora model and then the output from this model is an hourly price strip for our representation of what the Mid Columbia uh Market Hub looks like uh so we have a dollar per megawatt hour price forecast for every hour of of our planning Horizon that then makes its way into our portfolio model our flexibility analysis and then it's also used a few other places through uh throughout psc's modeling efforts including rfps requests for proposals um and avoided cost of energy um yeah so this uh I guess since this an input for all of these kind of Downstream analyses this happens well in advance of a lot of the other input generation that that's going on so uh I've been working on this price since like last summer and we're just kind of finalizing it now next slide please uh so I'm going to walk through some of those updates at a really high level um and then we'll show some results and then uh yeah we'll pass it off to Jennifer so you can see how those results are used the first kind of input that I'm going to talk about is our clean policies um so Aurora is a fundamental-based model so we have to enter in all of these policy assumptions and Generator assumptions operating assumptions and how all those bits and pieces interact results in those market conditions that we're after um and one of the big things that's driving uh Energy prices into the future is what kind of resources are doing the generating uh so uh we look at clean policies which Drive utilities and states to adopt more renewable energy sources which have an impact on uh electric price forecasts um we're using uh the exact same methodology that we use in the 23 uh progress report um if you folks remember me giving a similar Spiel a couple of years ago um so we grabed some data uh aggregated by the uh Northwest power and conservation Council um which incorporates uh legislative renewable portfolio standard requirements that's the RPS requirements so those are legislatively binding targets usually put out by states that say you need to achieve you know 50% renewable energy by 2030 um so Ceda is a good example of uh a renewable portfolio standard um any local government clean energy goals so we're seeing more and more cities uh have you know small small or large cities have their own clean energy targets and that's changing the landscape of what energy looks like in those regions and then utilities have also pledged uh their own renewable goals like Excel Energy has a 100% clean energy Target um that may not be legally binding but it's certainly changing the way those utilities produce energy um in the past we had just looked at those legislatively binding RPS requirements but since those local government and utility policies are changing the way energy looks like in The Wack uh we wanted to make sure we captur those in our model uh and the way we've modeled all those targets um you know they come in kind of Peace meal by state city region utility um and we aggregate those based on a demand and we create one major goal for the entirety of the W um and that one long-term energy minimum which is kind of the constraint terminology in Aurora for how this is modeled we have to add a certain amount of energy um that's can only be generated from specific types of resources in this case clean energy resources wind solar Hydro um and we used to model these on a state-by-state basis as opposed to one big Target for the entirety of the W um but we were finding that states with really high renewable energy targets such as Washington and California um which may be only suited to one type of energy like wind or solar um we were getting really really big builds in those States for these clean energy policies and it was kind of warping what the energy landscape looked like um so by creating one target for the ENT entirety of the whack we get the influence of um we have to have a certain amount of clean energy across the entirety of The Wack um but you can build that in places where it makes sense you know solar can be built in Arizona or Nevada and pulled into California based on the availab availability of transmission or in the case of Washington we can build wind in Montana which is a great resource and pull it into Washington state to help meet some of those Queen energy requirements all right um next let's just take your pause there right before that was a lot of great context just scanning the room any questions so far feedback so far all right good this is I was stalling to allow you to take a drink of water my plan is working out perfectly thanks so very good all right carry on Tyler all right onward thanks will uh all right so we're still on updates uh we also update our natural gas price forecast um and let's see we we do this every year um we build an ensemble forecast that's composed of a Ford marks forecast for the beginning portion of the planning Horizon and that's supposed to capture natural gas prices as we expect to see them for the next several years we build a little transition period in so that there's a buffer between those two prices and then we end up um modeling our long-term uh natural gas price forecast with a wood McKenzie long run fundamentals forecast um so just updating from the 23 progress report um the wood McKenzie forecast was the spring 22 and the 23 epr who have updated that uh to the latest available forecast from wood McKenzie um and we also grab the most recent Ford marks available for when we extract that data um just I'm noticing in the chat a question from Ezra about clarifying if real levelized or nominal uh levelized would be a it would be in the first period so I Lev levelized these back to 2025 so both of these are in $ 2025 thanks does that help Ezra yeah I mean I um this in later slides was clear okay thanks great all right so I'll try to point that out as we go yeah beautiful all right Tyler carry on great um so uh in years past uh we've used a smaller period of Ford marks we uh tended to use a fiveyear window of Ford marks um and then transition into our long run wood McKenzie uh fundamentals we noticed a really big break a disconnect in that um Ford marks to Wood McKenzie transition period um so there's a big drop in prices that created some suspicious looking dips in our electric Price Forecast um so we extended out that Ford marks forecast out to a seven-year period 2024 to 2031 um and that allowed for a much smoother transition between these two forecasts uh so it's a subtle Nuance that that's a little different from our 23 progress report um but was just a you know create a smooth transition um and here on the the chart that I'm showing you is the natural gas price forecast levelized for the period 2025 to 2050 in dollars per mmbtu and the bar on the left is the levelized price for uh the 25 IRP at 454 and that's up a little bit from uh the 23 epr Price Forecast um I think that's all got on this slide yeah yeah not seeing any hands we can move on to the next slide all right continue to talk about updates we make to that input database uh we also update the hydro assumptions for uh the Pacific Northwest region um so starting in the 23 progress report we take a look at uh We've Incorporated the impacts of climate change on our Hydro forecast um so the the scale here the chart that I'm showing is an example year with months on the bottom of the slide so January to December and then the average megawatts of hydro across the Pacific Northwest region um and I've got two two colors here the the green color is the 25 IRP assumptions and the 2021 IRP uh is the red line and the reason I went back to the 21 IRP is uh that uses the 80-year historic Hydro record as opposed to the climate change assumptions which we adopted in the 23 progress report um so I want to show you a comparison to from historic Hydro to the the climate change assumptions uh and kind of the big differences between those two forecasts are you can see in the winter months particularly January to March the climate change Hydro uh allows for more capacity and then in the summer months where it's hotter and drier um we have less Hydro capacity as opposed to the as compared to the historic record uh how we come up with those climate change assumptions uh there were three climate change models looked at by the Northwest power conservation Council uh Cally named AC andg it's like can esm uh ccsm4 for and I am forgetting the last climate model but we can get you that information if you're truly interested um but these three different climate models represent a range of different Hydro assumptions um and as well as load assumptions that cover a range of different probabilities uh and we've averaged all those assumptions together to take a look at the uh uh the overall Trends in in uh what those climate change impacts are for the the Pacific Northwest uh the I see Laur oh sorry I didn't mean to cut you off no no no go ahead I I see Lauren's hand so I wasn't sure if that was from a few moments ago great thanks Sophie um at and I do have a question about actually like a previous slide but on this on this um piece I I do know that the council is um looking at some potential updates to this methodology and I'm just curious if um PSC is tracking that uh you know for the ninth plan development um it's not clear to me exactly what they're going to be right yet I think they're still working through some of the changes but um just want to sort of echo our support for using the council's uh climate change Baseline and the modeling um and as it uh gets updated uh encourage psse to track that and incorporate changes as necessary um and then I did have a question about um uh the gas forecast uh apologies for being kind of late on this yeah worri we can back up a slide I think I've got time yeah I'm just curious if th if any of those forecasts um take into account um British Columbia LG exports that are going to be starting Within the this cycle I believe in 2025 I'm just curious if that is um taken into account in those forecasts and what the impact is yeah Lauren I uh I am not an expert in gas price forecasting it's kind of an input that I take and use um let me catch up with our gas expert gender um offline we'll get back to you the feedback report thank you yeah appreciate it Tyler great Emily just wanted to make sure you Flagg that for the notes for the feedback report great all right um thanks for letting me break in there a moment ago Tyler and then I also see while I have the mic here that Joel has a question about slide 16 so it's going forward one again well so um is is PC just using a straight average here or are you looking at each AC and G individually Tyler is now a good time to answer that sure yeah so uh for a deterministic run we look at a straight average of all three climate models AC and G um and then when we move to our stochastic price forecasting we split those hydro cases up separately so we will have a view into the impacts of each of those different climate change scenarios um but for deterministic we're looking at a straight average so we kind of get the trends of the strong trends of all three of those models together great thanks for that I don't see any other questions so you can carry on great I think I've got two more bullets so I talked about AC and G um those climate change scenarios uh provide precipitation data and Stream flow data um so that's passed through uh the Genesis model um and we're still using Genesis classic for those keeping scor as opposed to the redeveloped Genesis model um to get the actual Hydro generation from the Pacific Northwest hydrogenerators and that's what translates into these uh Aurora assumptions for available Hydro capacity uh and then finally uh a slight update this year in bold uh previously we had applied a kind of Pacific Northwest wide Hydro shape to the entire region uh this year we used those outputs from Genesis at a individual generator level and disaggregated them down to apply the specific Hydro shapes for the generators in their area um so it's just a little bit of data disaggregation um that provides a little more resolution to our model and that's all I've got to say about Hydro if there's no more questions I'm not seeing any questions let me just scan the room anyone want to break in here with a question before we talk about [Music] load all right Tyler you can move along great uh all right so this chart is a look at the load assumptions over the modeling Horizon uh so I've got average megawatts on the Y AIS and then our modeling year on the xaxis uh so I've broken these up into three distinct groups and you kind of see the shades of green where solid lines are the 25 IRP and dashed lines are the 23 progress report uh so solid represents the update into this new planning cycle uh starting at the bottom uh this is the Pacific Northwest Regional load and we acquire that from the Northwest power conservation Council uh this data is consistent with the uh Regional load forecast produced as part of the 2021 power plan um we would have liked to have updated this data uh given all the great talk about electrification transportation electrification and data centers um but when we started this forecast uh the council hadn't released any new forecasting information uh and we really wanted to tie keep the the tie between our Hydro data which uses climate change assump to our load forecast which also embeds those climate change assumptions so we've retained the same forecast from the 23 progress report and that's why that there's no difference between the the solid and the dashed lines uh in the middle bar here uh in the dark dark green is the California load forecast uh so previously we had used the andery examplar base assumptions for all of our California load and we saw that it was looking really flat and that didn't seem uh on par with uh what we were observing through reports from kaiso uh so we imported the uh 20122 C that's the California energy commission I um oh man I always get This Acronym uh energy planning a report uh I'll take a look I'll look that up quickly we can help you out in the chat Tyler you can that'd be great yeah move along uh it's like their equivalent of an IRP so we grabbed their 2022 load forecast which includes the impacts of of EV and and climate change we saw a pretty dramatic increase in load so that's reflected in this model and then the light green at the top um that is kind of everything else in the uh the rest of the W that's not part of the Pacific Northwest or California and we've just retained the default assumptions from the energy Exemplar database any questions on on Regional load questions comments on Regional load I'm not there we go the acronym integrated inter policy report I'm not seeing any hands not seeing any comments Okay Tyler go to the next slide great all right I think this is our F oh no we've got a couple more update slides um anyway uh the uh as I mentioned we take the default energy Exemplar W database and that's usually a couple of years old the one we're looking at is from 2022 is their most recent release as of when we are using this model um so in those two years lots of things can happen uh retirements for coal plants are announced and new resources are built so we try to uh make the database as up toate and fresh as possible uh so this slide represents uh changes in the datase that we we' made to the existing resources so this is before any sort of long-term capacity expansion modeling that that that occurs uh this is part of our input process um highlights are lots of coal uh retirements have been announced so uh several gigawatts of coal are exiting the W um a good chunk of that is in the Northwest powerpool Northeast region particularly out Alberta uh which uh is retiring coal and repowering those with gas so you'll see a bit of a connection between coal going out and gas coming in on the figure on the right which looks at uh recently announced projects that are either in late stage development or under construction uh all across the W so we try to this is a somewhat important step to take a look at what's coming into the region um but maybe not super critical in that we're going to do a capacity expansion anyway um all right all right if there's no questions there continue onward uh and then one of the last steps we take is to try to model the climate commitment act um this doesn't come embedded as part of the energy Exemplar input database so it's a uh a step we take to to amend how the model Works um and I'll walk you through kind of the changes that we've made from the 23 progress report to the 2025 IRP to capture the impacts of that uh carbon market pricing um in the 23 epr uh we had applied a CCA allowance price on all emitting resources in Washington and everything outside of Washington state any emitting resources did not have a a uh CCA allowance price applied uh and then we we were kind of thinking about this and realized that that we were missing a pretty big component of uh how market prices if we import if Washington Imports emitting energy it's also tagged with a uh CCA allowance price um so we move to this 25 IRP model where all emitting resources uh both within Washington State and without so they're kind of highlighted that lighter green color um are subject to a CCA allowance price um and what this does is it kind of warps the prices for Regions outside of Washington state to include that CCA allowance price um so our Price Forecast is a little less reliable for Regions outside of Washington but it provides a really good representation of the price washing uh Washington balancing authorities would pay for power and at the end of the day we're trying to model what psse is going to observe power prices to be um so we thought this was a really good tradeoff for our specific use case um and uh we're satisfied with with the results of of this modeling adjustment thanks Tyler Tyler you're saying that in the dispatch model in Aurora for the price Model you're putting a CCA price into the dispatch price for All emitting resources in the region that's correct okay thanks and this is the climate commitment act this is not the social cost of greenhouse gas just to clarify those those are two separate carbon prices so it will affect the dispatch in a way that's not really reflective of how they're operated but as you're saying you think it's a better way to represent the cost to Washington of that energy that's correct yeah thanks yeah good question thanks we have time for more Q&A anyone else I know that Fred hu from Enick joined John Alis from NW PCC joined um both you know 20 30 minutes ago now but anyone else have any questions or comments before Tyler goes goes along all right we can go to the next slide then great so now we're moving from uh our input update assumption to the results from our model uh this is a look uh so our first step when we run the uh electric Price Forecast model as we do a long-term capacity expansion and this really plays into uh the fundamentals approach of our model um where we want to see the impacts of those climate of the clean energy policies uh CCA impacts uh how is that resource landscape going to change over time what resources are added and how are they going to impact market prices particularly as we view them in uh Washington State um so this is a look at the entirety of the W kind of broken out by W sub region um and uh we've got clustered bars here where the kind of first bar in each set of two is the buildout from the 23 electric progress report and then the the second bar is the buildout from the 25 IRP and as you can see generally uh builds are up largely due to that really big increase in California load that we observed uh couple of slides back uh so that cax that's California Mexico that's the region uh you could see in 23 uh that 23 epr had you know about 30,000 uh megawatts of new builds and we jumped up to nearly 100, to meet that really large increase in load that we observed um but that also trickles outside of the state um the desert Southwest will be contributing more solar to uh allow California to meet their clean energy requirements um as well as areas in the Northwest power pool that also uh provide energy to California um and also along the way those clean energy targets have increased from last year as uh from the the previous modeling cycle so uh we do see more Renewables in the system as compared to the 23 progress report driven predominantly by wind U but solar is also a big player and you can see storage is uh helping to uh provide PE capacity in a lot of uh the the regions Across The Wack all right I'm not seeing any hands go to the next slide all right so this is kind of the objective of the electric Price Forecast uh we're after actually Tyler I spoke too soon I see John's hand all right go ahead John hey hey Tyler uh hopefully you can hear me sorry I'm on my phone I'm I'm mobile while I'm listening to this yeah yeah nice presentation so far um just a question and and I apologize if I missed it um when you were uh treating the new resources in Aurora uh for the buildout do you have um can you remind me what you assumed for the um inflation reduction act kind of application of the ITC and PTC yeah so we uh we applied the IRA and we applied uh only ITC credits to all the renewable resources that that would qualify um and that's kind of in line with the the default assumptions that come through the um energy Exemplar database um does that answer your question it does it does um the only comment um I would make we actually are doing the same thing right now um we we but we're kind of investigating that it may be true that the PTC may be more valuable for certain resources um we haven't Incorporated that yet we're still kind of investigating it just something something to flag maybe you folks might want to take a look at it on the side it right now like early early studies for us look like the PTC might be better for some Renewables uh maybe the ITC for some of the other resources just thanks John thanks John it's always good when multiple entities are working on similar initiatives I heard someone else's voice yeah Elizabeth go ahead yeah so I'll just point out John so this is for the electric prices so between ITC ptc's yes ptcs will probably give you better for like wind and solar so you could see a little bit trade-off between wind and solar we also kind of go a little bit more inth in our ITC ptc's assumptions through our um our portfolio model so we do have it broken out between what gets an ITC what's getting a PTC and we did do that analysis breaking out what would be better for ITC or PTC because like traditionally solar had gotten ITC but now they're qualified for the PTC and that could actually get you better um more reductions or better cost assumptions on the solar using the PTC for example give that cost may be coming down so also point that out we have some different assumptions yeah thanks Elizabeth great thanks appreciate it always good to draw those borders between go ahead Sophie oh I'll just remind the viewers at home that there's an acronym uh appendix in case the the ITC and PPC is making a little dizzy so Tyler please keep going great thanks Sophie and ITC is investment tax credit and PTC is production tax tax credit um all right so I think I was starting off this is kind of our objective for the electric Price Forecast to get a price strip of what the uh electric Price Forecast as represented at the midc Mid Columbia Market would be for psse to purchase power and then that gets that gets passed to our two zone model we use for our portfolio analysis um so uh I've got on this slide a comparison to our electric Price Forecast from the 23 progress report um the x-axis is the modeling Horizon again and then on the Y AIS I've got dollars per megawatt in in nominal dollars and all these prices are the average for the year um and broadly speaking these prices are are in line with what we were seeing from our 23 electric progress report uh a little higher in the near term uh due to higher natural gas prices uh and then a little higher in the midterm uh due to uh a higher uh CCA allowance price uh that that we're modeling and I think we'll we have a a chart later on the slide deck that details that uh CCA allowance price that that we're using at both our electric price and portfolio model um and then as the prices grow out to about 20 48 49 and then uh we see this tail where prices actually start to drop uh We've attributed that drop to uh California reaching their 100% clean energy requirement uh so that's kind of like a Breaking Point a Tipping Point where uh there's enough renewable energy providing zero dispatch cost energy in enough hours that we see the price start to decline as opposed to continue to increase um yeah I think uh those were the the major points for this chart I see Joel yeah yeah thanks Tyler um I guess uh the sort of cliff in 2050 is what I what I'm interested in I think what you just said starts to explain it but I'm not sure why it's so abrupt because there would be a sort presumably they it'd be a gradual transition off of gas and into these 100% clean energy scenario and seems like it's not intuitive to me why that would kind of fall off a cliff like that in 2050 rather than um some other shape yeah Joel I think that's a good observation um maybe a a slide later on in the deck will will illustrate this a little bit better um you know we this isn't this is our deterministic run that we've selected for this Price Forecast uh you know we've run many more simulations as we're developing the price inputs um and we had seen some more gradual declines and some of those other simulations uh but when we dialed in all the inputs that were satisfied with uh we did see this kind of abrupt drop that was in line with a lot of those other simulations um but maybe a little more abrupt uh you know you do start to see like a leviz between 48 and 49 the price doesn't increase as dramatically and then you've got that kind of big drop um you know definitely we'll spend some more time looking at that but uh given the context of a lot of those other simulations that we've run and we're seeing this kind of dip repeatedly across all those simulations I we feel pretty comfortable with with that result thanks for the question and for the response Tyler I see Ezra hand now yeah I was wondering you talked earlier about your assumptions about um the um renewable requirements as sort of aggregated uh renewable energy requirement across the wecc um but I'm wondering if there's any in this modeling any representation of compliance with the uh U the Washington clean energy law um you know especially the 100% clean uh 2045 and how that would impact pricing so it seems like that you know one thing you might expect is that there would be a lot more renewable energy depressing prices um as we approach 2045 uh but Ian I guess there's a flattening out here but I'm wondering if that's represented in this model in any way thanks Ezra yeah so uh the queen energy transformation act that requires Washington to be 100% clean by 2045 is represented um it's represented in that Big W wide clean energy goal um and I guess I'll note that some of the interactions in this model since we're looking at such a large region are coarser than you would observe in you know the very focused look that we get in our specific portfolio model um so Washington State itself uh you know is fortunate to have a lot of Hydro power uh which counts as a clean resource under the clean injuries transformation act um so at at the level were reviewing prices um by and large Washington state is nearly at 100% today um and then on into the future as we add some more wind and solar resources uh at a state level uh you know we reviewed where Washington sits uh with its own with respect to that 100% Target um and we're at 100% even using that uh kind of w wide Target so it's represented and observed uh in our results without having to explicitly model uh a Washington 100% Target okay but just to push back on that a little bit um you know the target as you're describing it is closer to a carbon neutral Target when you say Washington is close to 100% now that's close to closer to 100% neutral uh which is not the same as the 100% clean Target right I mean it's just it just requires a it's likely to require a lot more um I don't know I don't know how you would model it I I would admire anybody who can figure it out now quite difficult but um but it is a more demanding Target you would have a more dramatic effect on price could you maybe explain uh how you see neutral and queen is different well because neutral means means you can have a lot more shifting of renewable energy between you know over time you just have to meet your load with uh with renewable energy credits essentially that's you know that's not quite that flexible but um whereas the 2045 Target uh ostensively I we'll see how the rules actually flesh out when we get there but the idea is that you basically have to you can't be using fossil energy one hour making up for it with renewable energy and another yeah uh I I think the ru making is underway so we'll we'll learn more as as that progresses um but yeah I think the resolution for that kind of hour by hour clean energy Target is outside the scope of the select Price Forecast um you know something will continue to track but uh it's a good observation thanks thanks for that Ezra and I did see Freud did you come off of mute for a moment yeah I did have a question just about this graph maybe that maybe connects to uh was the question asked maybe John's question about the this price does this represent just the production cost or does it representation of the the levelized cost of electricity and maybe if it's levelized cost electric that's why you might see a drop off after a period of capital payment I I don't know I I I yeah it's a little bit uh interesting um the shape yeah so this this is a dispatch cost fory uh it's not the levelized cost of energy all right good okay I'm gonna encourage does that help Frey was there a followup there I mean I I just have to think a little bit more about yeah about what this means and I would like to see um yeah a little bit more about the the the model that comes up with this dispatch um results but so it helps it definitely helps thank you great well Tyler let's wrap up the last two slides because we're leing a little bit into Jennifer's time here and um we'll we'll pause at the very end to see if there's any remaining comments okay yeah I think both of these last two slides kind of confer the same information different ways so we'll do them both and then grab some questions uh next slide please will uh so this is a look at uh price volatility across our entire planning Horizon so I've plotted every hour of every year as a little dot on this plot and then drawn some some box plots over the top so you can get a sense for the volatility of of electric prices um and as you can see you know volatility increases as the modeling Horizon goes forward um and really want to highlight at the end here where we see that dip in prices um the number of high cost hours increases those kind of outliers uh but we have a large increase in the number of of low you know zero to5 uh per megawatt hour prices that that dominate in that 2050 uh time frame and that's what results in that kind of dip in that average annual price and if we jump to the next slide uh this is a similar look in a different way uh each of these plots represents a different slice in the time Horizon so we've got 2030 2040 on the right and then 2050 back to the left um and each of these lines is uh a monthly price broken up by the hour of the day along the uh x axis and then the price is on the Y AIS um so we can you can start to see monthly Trends and hour of day Trends and really the hour of day Trends are the most interesting here where as more and more solar is added to the region uh the prices in the middle of the day are are dramatically impacted and and deflated over time uh till we get to 2050 where most of those on Peak prices in the middle of the day are you know at zero or very low cost thanks Tyler I think that was your last slide here so there's been great discussion all along but any reactions to this I have to admit this was one of the the few slides I really felt like I could I could grasp just with my very non-technical brain um but any for your technically minded people questions about uh Tyler's presentation at Large all right well you can take another sip of water and take a step back Tyler thank you so much you feel did some really interesting questions and there's a lot of information here so can we have Jennifer come on up yeah thanks for the discussion everyone yeah great Jennifer thanks for being here my understanding is that um Jennifer um is able to take kind of questions throughout every other slide sort of thing does that still work for you Jennifer yeah I'm happy to entertain questions along the way great so we'll Happ you go to the next slide right good morning my name is Jennifer magot and my the goal of my presentation is to provide an overview of psc's portfolio models so let's go to the next slide so earlier Tyler described the modeling framework using Aurora to generate the electric Price Forecast oriented topology includes A Wack wide view with multiple zones ps's portfolio model also uses Aurora but the system is much smaller it's a two zone system so in this slide uh the rectangular boxes represent the zones in our two zone system Zone one is psse uh and zone two is the mid SE Market the arrows that you're seeing here between the two zones represent the transmission link between the PSC system and um midc Market all existing and new resource alternatives are located in the PSC Zone to make sure that they dispatch to PSC demand the midc market uses the electric Price Forecast that c um that Tyler just um showed us earlier uh as an input for its hourly Price Forecast I think I can I can stop here just again describing that uh where we were in the um electric Price Forecast um system where it's a a w wide view um moving into the P psc's portfolio model it's really just a smaller uh system that we are modeling here so it's like a slice of the big picture I think we can go to the next slide all right so the input database itself is a collection of data that serves as a starting point or foundation for our portfolio modeling process so um similar to um how it is for the model where you have the entire uh all of the resource options in the W what we're seeing now is basically um information specific to the PSC Zone uh so in here we can see a PSC demand uh system requirements to meet Peak and Ceta it also contains Hydro forecast as well as power and gas gas price forecast and so uh whenever we input um Power price we make sure that the corresponding gas price that helped develop that power price uh is also included uh in the database that we are using it also has information on existing and new resources um transmission constraints as well as carbon price so these are uh the variables so that um I just saw a restart box came into my side and I panicked okay so cancel I did so hopefully I don't just shut out um sorry about that anyway so these are uh just the major variables that uh you we are that are needed the parameters that are needed by the model uh to run uh simulations and perform calculations uh and we don't have it numbered here but there are two phases in psc's portfolio modeling the first phase is the long-term capacity expansion model run uh we also refer to it as ltce or sometimes just long-term run uh which forecasts the resources to install or retire over a long-term planning Horizon and again this is in order uh to keep Pace with the energy and Peak needs and meet the requirements under CA uh the long-term capacity expansion run produces a set of resource builds and retirements uh that includes the impact of the social cause of greenhouse gas uh we have a slide later where we will revisit ps's application of the social cost of greenhouse gas in the portfolio model but the output from that long-term run um is then passed on to the second phase of our portfolio modeling process which is the hourly dispatch for psse uh we also call that the standard zonal model run or just the hourly run uh and in that modeling run uh Aurora simulates every hour of the study Horizon for a complete dispatch of the resources uh the hourly run then produces the um total portfolio cost and the hourly dispatch of uh existing uh and new resources included in the portfolio I think this is a good stopping point so if there are any questions I'm happy to take them otherwise we can move on questions or comments so far for Jennifer looking around the room Jennifer I'm not seeing any hands and I'm not seeing anything in the chat so carry on all right next slide please all right so this slide should be familiar since PSC went over this at our Peg meeting on March 12th uh here we are describing how psse models greenhouse gas as a cost Adder uh when making resource decisions for the IRP uh so direct costs and externality costs are added together uh to calculate the total cost of making intermediate and long-term resource decisions direct costs are uh what drives operations such as plant costs operations and maintenance fuel costs variable cost and CCA costs so these are costs that are paid for by psse uh and are reflected in customer bills externality costs are are the values that do not affect operations and our cost to society so here we can see that this is uh the calculation of the tons of pollution uh including Upstream emissions times the social cost of greenhouse gas based on the dollar per ton rate from uh the UTC this cost to society as a to is an externality cost so this is not a cost charge to our customers uh like carbon taxes may be so what does this mean in the portfolio model uh so when applying the social cost of greenhouse gas as a cost Adder for emitting resources uh the cost is included in the value reporting of that emitting resource during that long-term capacity expansion phase of the modeling process but the emission costs are not included in the dispatch so the social cost of greenhouse gas is accounted for a post economic dispatch of the of the emitting resource and is included in that resource value calculation so use Aurora uses this information then uh to evaluate datam is emitting resource against uh competing new resource options in the portfolio um in terms of unspecified Market purchases uh PSC uses the emission rate per the cedar requirements of 473 metric tons of CO2 per megawatt hour uh and also I just want to add here that based on feedback from the rpeg meeting on March 12th uh PSC will run a sensitivity where we will include the social cost of greenhouse gas uh in dispatch cost uh so this means that um it will be included as a direct cost in the long-term capacity expansion modeling um any questions there hopefully this really brings it home since we've covered this up previously yeah great thanks Jennifer and for emphasizing kind of previous feedback there questions or comments okay let's move on then okay so uh in order to solve uh the two zone system uh in the long-term capacity expansion model run uh or employs a mixed inure linear programming so it's a powerful optimization to technique uh when decision of variables um could be uh continuous linear Val variables or they could be discret so we can think of uh discrete variables could be uh how many resources could be built uh while other while um continuous linear variables could be the total cost of resource so having this um optimization technique using mixed linear uh integer uh programming really allows for consider ation of different types of variables so the objective function is to minimize the net present value of the total portfolio cost um Aurora identifies uh the most valuable resources from all available options uh and returns a combination of existing and new resources that meet all system requirements so again this is all happening in that long-term capacity expansion run so the evaluation is based uh on the total net present value of the production the fix the build cost as well as the energy revenue for that simulation period um and the way that works the solver runs through uh multiple iterations during that long-term run uh to evaluate a mix of resources in the system that meets all of the requirements until the total portfolio cost converge uh and when we say total portfolio cost uh we mean the sum of the capital costs fixed costs variable costs Fuel and transmission costs less Market revenue or market sales in this case for the entire study Horizon um and there are multiple considerations in that long-term run uh in order to accur accurately uh represent the PSC service territory uh and resource additions uh constraints are placed in the model uh in order uh to help produce a reasonable output so the table here uh describ this constraints included in the model uh we have resource characteristics that forces the model or forces resources to behave as they would in the real world we have transmission constraints uh which limits uh Market purchases based on real conditions and additionally for the 25p IRP we are modeling uh transmission capacity limits as build limit uh for generic resources in various locations so the information that we've heard from um previous arer presentations about um transmission limits will be used as an input in our portfolio model uh the demand forecast is also a constraint and informs the model the demand profile it must meet uh and we also have resource adequacy uh and um renewable um requirements in here that helps ensure that the final portfolio not only meets resource adequacy standards but also but is also um CA and RPS compliant good pausing Point Jennifer just to see if there are questions comments or questions I think you're being too clear and succinct I like it yeah or it's almost lunchtime one or the other that too yeah this is great I'll just break yeah I mean I guess this is similar to my last question when you say um CA compliant um this is going through 2045 so this is meeting the uh 100% clean standard in 2045 yeah that's correct so uh in our portfolio model uh we Sim we will be modeling a long-term energy minimum uh so that there's enough resources that are built to make sure that there's enough resources uh or clean resources to meet that Target that's yeah thank you good okay Jennifer how about you go to your next slide and we can always go backwards if people have a thought right okay next slide please this is actually my last slide so maybe we can take an early lunch I'm not sure um so um I'm going to be uh briefly discuss the difference between uh the deterministic portfolio analysis uh and the stochastic risk analysis so uh our deterministic analysis is a method in our portfolio analysis where the outcomes are predicted based on known inputs such as load and power prices uh without considering Randomness or uncertainty so it helps us to answer question like a question such as how how will different resource Alternatives dispatch to meet psse demand or to the market uh given a set of assumptions defined in our reference portfolio or in the various sensitivities that we may be evaluating it helps us identify uh a least cost integrated portfolio which is really the ideal mix of demand side and supply side resources that will meet the system requirements for the reference portfolio and again for any sensitivities that we may be running um and lastly it gives us a glimpse of how uh specific input assumptions or or combination of assumptions can impact that least cost resource mix so as an example uh we could be running a sensitive ity assuming high electrification so this means that um we'll be updating the load forecast input to account for higher loads we may also adjust the Energy Efficiency programs or demand response response program options uh within um the model uh for consistency with that higher demand so that result of that deterministic run uh can provide an insight to us is how to these new assumptions uh change portfolio SE uh builds or resource selections and costs uh in comparison to the reference portfolio so on the other hand uh we have the stochastic risk analysis here so uh our approach there is to test the robustness of different portfolios so unlike the deterministic analysis uh it considers the probability of different outcomes based on random variables so in this case uh we we will be taking some candidate portfolios from our deterministic analysis and run them through simulations where we vary power prices gas prices Hydro wind and solar uh and our load forecast uh in order uh to get some sort of a distribution uh on uh Revenue requirement right so we'll have an idea how uh certain Port portfolios uh will uh behave in these varing conditions so PSC will use a combination of deterministic and sarcastic analysis for the 20125 IRP right Jennifer is that your last comment there that's my last comment and my last slide very good well looking around the room does anyone have any big picture questions or comments for Jennifer or on just this last slide in particular well thank you Jennifer for your great preparation there and for the good questions especially Ezra thank you for the good back and forth um we are pretty much just at the time we expected for our break 11:30 everyone will get three extra minutes so if you want to grab some food stretch all that good stuff um we'll come back at 11:40 and uh just a heads up um I think for the part where Elizabeth is is going to be leading that last section with the discussion I will ask for cameras on so if you're going to be eating um and you're one of those people who don't like eating on camera maybe do that ahead of Elizabeth's section so everyone um enjoy your break and we will see you at 1140 e e e e e e e e e e e e e e e e e e e e e e e e e Okie do can we all reather especially Nathan wonderful and can I just see from our Peg members a thumb a face or just something to know that your back I see a face from Frey Joel stepen Lauren stepan's back great Joel's here all right I think that's critical mass will can you uh get the deck back up maybe will stepped away oh there we are okay so in our effort to get to that discussion at by 1210 Nathan want to T us off here yeah sounds good H thank you Sophie um for those of you who don't know me my name is Nathan critchfield I am an analyst on the electric IRP team here at PSC um yeah excited to be here talking to the rpag my section today is going to focus specifically on um the reference case assumptions for the new generic resources so next slide will okay so this slide just kind of aims to paint the landscape of the different planning assumptions and inputs that go into the IRP and I think this slide could probably be like 5et by 20 feet with a million tiles but we have limited space um these the boxes that are highlighted are the ones that are gered in today's conversation and really have to do with new resources specifically so you'll see some things on there like existing resources um Equity assumptions and cbis flex benefits these are important items um but don't directly relate to today's conversation so this is just kind of level set and get you an idea of what we're going to dive into a little into some deeper detail on and I guess I'll also point out I think a lot of these things we've had our Peg meetings in the past or we're going to have our Peg meetings the future that kind of put a microscope on these specific tiles um I'm kind of trying to like ice the cake and put it all together for you um so you can so you can see how those those pieces fall um so next slide and also I should say I'm happy to take questions on the fly so raise your hand put it in the chat just interrupt me that's fine um so I think this is this is not new information here for you guys uh we had black and Beach come previously to the rpag and talk in a massive amount of detail um about the tech assessment um all the details of it all the tech technologies that were evaluated uh this is aiming to kind of boil that down and say these are the representative technologies that are going to get modeled in the IRP or as Philip put it in the intro the these are the tetris blocks right I like that analogy um so I think there's some stuff here that's uh not terribly surprising to folks you know we have utility scale solar and wind back again in a number of locations um small modular reactors are back as a Bas load resource um again distributed energy resources both solar and energy storage um that energy storage is a 5 megawatt with Theon battery um further utility scale energy storage options there's some been some movement here so uh as Philip mentioned in the intro we wanted a short duration option A medium duration option and a long duration option and a representative technology of each of those categories so for that short duration um kind of unsurprising I think to most people due to commercial success but is a lithium ion battery in a 4-Hour variant and then for the mid duration we have the Compressed Air energy storage or case in an eight hour version and then lastly uh we heard a lot of feedback from folks and about interest in long duration energy storage and PSC agrees with that interest um so we're modeling the form energy iron air battery uh in an 100h hour version so that kind of that's the energy storage component uh for combustion turbines or peers uh we're actually modeling one technology which is I believe a seaman Sgt 800 unit um with three different fuel configurations so there's a natural gas as primary fuel with R9 minus backup then a hydrogen and natural gas blend as primary fuel with r99 backup and lastly uh just r99 alone so that's kind of the full picture of the different resource Alternatives I guess I I skipped over hybrids um we'll also have hybrid and collocated resource options uh as were available in the last IP as well so I yeah that's just kind of full picture of available resources for the model to choose um and I think you folks have seen this before so next slide sweet so I think transitioning from what those different specific Technologies are to where our model can actually see and build those Technologies what what the slide is trying to accomplish um so wind and solar we have pretty wide Geographic variability where these resources can be built and I think you guys are energy experts you know the benefits that are associated with that right like if we build all our wind in one place we're we're not really diversifying so I think we're we're that's the motivation there um I will point out you'll see those annual average capacity factors on the right um we're using the same renewable energy shapes as in the electric progress report uh these were developed by a consultant dnv um and they they developed shapes for our generic resources but also all of our existing resources that are pretty site specific um so that that data is getting used again in this cycle uh one point of clarification I'd like to make on this slide we have both psse territory and Western Washington um listed as resource groups the delineation here is Western of Washington is like the whole West part of the state if you subtract it out psc's bubble uh whereas psse territory is just pse's bubble and so the difference as a resource in western Washington area would have to get uh wheeled through Bonville power Administration back to C psc's load that's kind of the modeling distinction there um yeah I if there's any other questions on this slide we can any questions or comments for Nathan so far good you're drinking water while I I know ask a prolonged question I learned from Tyler there we go I've been accused at Mo of moving on too quickly when I ask if anyone has any questions so um I'll try to slow down sounds good all right I'm not seeing anything Nathan go ahead sweet yeah I think next slide then will okay so thinking about you know we have these technologies that we're going to model we have these regions that they're available I think the next natural question is how much of these Technologies are available in what regions um so these are the transmission constraints that will be modeled in the reference scenario um and these and these will serve as build limits for those resources and so I think I'm terrible with dates so I forget the specific arag meeting um but we had our internal transmission team come and present on these transmission constraints and what they're informed by um just as a summary these transmission constraints are largely informed by the 2022 and 2023 Bonville power Administration or BPA cluster studies um and I think I believe it was Ezra who asked the question earlier you know there's a lot of like uncertainty with transmission moving forward you know what if you had less what if you had more I think this slide is just to say these are the numbers that'll be pushed into the reference case to serve as those build limits but we also agree with that uncertainty and understand there's value and evaluating portfolios that might utilize more transmission or less transmission as those could also be possible Futures so I think these are these are the numbers um yeah these are the numbers basically from our transmission team that are going into the reference case but you know these are not rigid we're gonna we're going to do some analysis and play around with those later years to see how things could play out um I don't know if there's any other there's questions on this slide but I think yeah this is largely a summary of of what was presented at the previous arpac meeting I see that you got ahead of Ezra's question but there are no other questions in the chat sorry Ezra I didn't mean to steal your thunder I think we can move forward then okay so shifting gears a little bit um Tyler talked about carbon prices a little bit and Jennifer also talked about kind of the framework how they apply in our model um this is just talking about like our update of the price strips themselves um so for the social cost of greenhouse gas that's the green line on this chart um there's been an update to the price basically the way the social cost of greenhouse Gas Works is it's like a fixed value and then it's inflated at two and a half% year-over-year um basically that that that fixed value that first year value has been updated um so that's an update for this go around in the IRP um and additionally the CCA so you can see the blue line is the Washington h8 scenario which assumes linkage to California in 2030 um and that's what that Gray Line The psse Ensemble that Dash bline represents starts at that h8 scenario and then you can see it linking to the California energy commission or CC mid price which is the orange line as we move through time so um just high level uh none of our methodology is changing on these price strips from the electric brogers support we're just updating values to be um to be consistent with the most recent data available yeah think next slide will so another component when we think about carbon in the model is Upstream emissions um this Upstream emission rate represents carbon dioxide methane and nitrous oxides that are associated with all parts of the supply chain and transport um this is applied specifically to the social cost of green gas this doesn't have to do with the CCA so the way we model this is if we have this little example calculation shows if we had a new natural gas plant and that had an emission rate of 117 pounds per mmbtu we would actually add this 23 pounds per mmbtu on top of that which the social cost of greenhouse gas would be applied to and the reason that this is the way we do it is we we can't model the whole gas system we don't we don't do that it's outside the the scope of our model um so the emission rate the proxy on the emission rate is a good way for us to like wrap that into what we do and still capture that with the social cost of greenhouse gas uh I'll point out that when the CCA gets applied in the model the CCA would not act on that 140 the CCA is going to act on the stack emissions that would be that 117 um so the Upstream emissions is specifically for this social cost of greenhouse gas accounting and is a little Adder on top of that emission rate to kind of capture that yeah next slide will okay so this is this is a pretty text Heavy slide my apologies um but this is just to kind of go through a Litany of different assumptions that kind of show up throughout the model um so the first thing is this IRP has a Time Horizon of 2026 through 2050 believe the electric progress support was 24 through 45 so we've shifted two years and we've also given you three bonus years so if you like lots of data this is exciting for you um we next is inflation rate it's two and a half% per year model wide this is the same inflation rate was used in the electric progress report we've received some feedback that that seems low given Current financial conditions I think what's important to think about in the context of an IRP is that this is very much long-term planning um we're trying to have we're trying to have an inflation rate that that matches that so if there's short-term spikes these are going to level off over time um and kind of 2.5% inflation rate is is fair for our for our view in the IRP um you yeah do you see Joel's question in the chat I saw it pop up I did not read it yeah so let's go back one slide will to slide 36 Joel is asking is this example on slide 36 about where psc's up emissions are 20% Upstream emissions rate seems pretty high Nathan any thoughts yeah I think I would defer to a colleague maybe Elizabeth on that one um I'm not super familiar with the documentation on this yeah um yes so this substream emission rate is coming from a model called GH genius um and this is based off of the I'm going to forget that acronyms um PSC pscaa I'm sorry I'm G to have to get back to on the acronyms of the um where this is coming from but this is actually coming from a model called gsh genius um based off of the C Canadian um emission so this is looking at there's a model for us there's a model for Canadian the gas is coming out of Canada um so this is based off of that Upstream emission rate and I'll get you more information Joel any yeah Joel anything any further questions on that one uh no I think that's fine any any followup that they can send over though after would be be great great thanks we can put that in the feedback report or drop it in the chat good all right thanks Joel you can go forward one slide please will and then Nathan can continue unless I see anyone else raising a hand or anything no all right Nathan okay I'll good continue um yeah I think this was stated by Jennifer in the previous presentation for unspecified Market purchases PSC will continue to use the 0437 metric metric tons of co2e per megawatt hour um for purchases on Market Per CA um that emission rate is pretty similar to like a combined cycle natural gas plant um the inflation reduction act or the IRA has there's been a lot of interest in that and a bunch of different facets of our model and I think I'll say here that I'm going to talk specifically about how that relates to generic resources in the portfolio model um but I will say that the IRA has its fingers on a lot of our inputs um so whether that's like EV adoption and the demand forecast or that you know these incentives on the in the conservation potential assessment or the CPA and how that affects conservation and demand response or all those other things like it's baked into a lot of these different assumptions but this slide aims just capture how it relates to generic resources um and so I believe it was Ezra who asked the question earlier we will be assuming PTC at 100% for the planning Horizon and the ITC at 30% for the planning Horizon um the ITC will be used for storage resources um and the PTC will be used for other new technologies new renewable Technologies including small modular nuclear and that's what our internal Financial uh analysis has suggested is the best application uh for the it TCS and ptcs respectively um we've received some questions about the bonus incentives that are part of the IRA um what that boils down to is these will not be included in the IRP and one of the main reasons for that is the bonus incentives are like super specific in terms of like what they are and if you qualify um and I think we we harp on it a lot that the the IRP is very generic in its reach um I mean we literally call them generic resources so like trying to include these bonus and incentives um is challenging with the level of specificity that an IRP deals with so yeah that's kind of how the the IRA relates to to the new resource options um moving forward alternative compliance so I think there's there's been some discussion about Seda already um but we inform our model if we take 2030 as an example Year we're pretty familiar with the fact that we need to be 80% of our megawatt hours uh of load need to be met with renewable or non emitting resources come 2030 and so the way this is enforced in the model is we basically put a minimum on it so we tell the model you need to meet at least 80% of those megawatt hours with the nonemitting resources um but we have we have to be 100% greenhouse gas neutral in 2030 so if for example the model let's say determines its cost effective to build the 83% in 2030 there would be 177% of those megawatt hours that would need to be met by some sort of alternative compliance um in the previous electric progress report we used a Rec price to approximate this um and I believe the rec price we used was like a composite wind and solar Rec price for Texas after reviewing the rules again it turns out that this Rec price actually needs to come from Bonville power administration's footprint so it needs to be representative of like a a more local resource um so for this IRP PSC will estimate this cost as the levelized cost of energy the most cost effective renewable resource after we run run the new levelized costs so if we run the new levelized costs I'm just making this up and Eastern Washington solar comes out at 55 bucks a megawatt hour that's the cheapest renewable that will be the rate that's appli to those that 17% of megawatt hours um and we're totally open to feedback on this I think we're we're wanting to be more consistent with what the rules are saying but if if people feel like using the lcoe is not the right approach I think we're open to that feedback I will say this is um oh yeah go ahead Ezra presumably you mean the levelized cost net of energy revenues yes um I think what we've what we've thought yes so there you you're saying You' take the levelized cost of energy and you'd net out the energy Revenue so you just have the renewable attribute the marginal value of renew essenti yeah I think one thing we've thinked about one thing we we've think that's not a word one thing we've thought about is we need to see we don't have our new levelized cost calculated yet um we need to take so we have the power Price Forecast once we calculate those levelized costs um we need to see how the levelized cost Stacks up against the power Price Forecast and make sure that's reasonable because if the power Price Forecast were to outpace that levelized cost then you'd be stuck with a negative wreck price um which might not make L good news yeah I think that's a world we'd all love to live in um yeah I think that's that's helpful feedback I think we'll evaluate that once we have the levelwise costs uh calculated thank you yeah you got it um just one more thing I'd like to point out on alternative compliance this isn't something that goes into like this doesn't really impact build decisions in the model this doesn't go in on the front end so what we do is we we tell the model it needs to build 80% it does what it does and this is kind of like an accounting thing on the back end um so yeah we want to choose the best value to do this but if you know if we choose a slightly higher or lower value it's not going to impact what resources get built it's just going to impact that dollars accounting at the end um so for my last box here and then I'll stop talking at the slide because I've been talking at length uh it's just the discount rate so this is a model wide assumption we will be using 6.62% after tax weighted average cost of capital this is subtly different from I believe the progress reported 6.8% um so we've up we've updated uh to be internally consistent with psc's new assumptions um but nothing radically different than before so I will pause because I just gave you a monologue there's questions here I'm happy to take them that was good that was rich so yeah Nathan spoke quite a bit about financial assumptions anyone else have questions or feedback on kind of these assumptions being baked into psc's work no okay well Nathan you can move on to your next slide then sweet sounds good okay um so here we looking at the alternative fuels or I guess just the fuels at large for this model and I think there was maybe a little bit of confusion earlier when talking about the levelized prices uh the way these prices are levelized is that'll take a nominal price strip throughout the whole planning Horizon and then levelize that back and so like the levelized cost you see here is presented in like year one 2025 nominal dollars but the way that's actually calculated is we know we take the the whole nominal price strip and levelize it so I hope that's that's helpful um so you can see natural gas on the left um that 4 that $454 on the bottom the raw gas price uh we've gone ahead and added a box for the CCA and a box for the social cost of greenhouse gas to kind of illustrate the impact that those might have when we compare these fuels um as Jennifer talked about earlier like the way we model these are like we don't model it explicitly as like a fuel price this is just to like illustrate the impact to compare across fuels um so I think I don't need to harp on the gas price too much because Tyler covered that in much more detail early on so it's the same natural gas price forecast uh is used in the power price model with the forward marks near-term forecast and then stitched the wood McKenzie long term um we have a hydrogen Price Forecast which is about 80 bucks levelized throughout the planning Horizon and this is the result of psc's own internal analysis we have a a team of hydrogen experts here and they they generate that forecast for us and uh you can see it says electrolytic in parenthesis um Ceda rules right now specify that electrolytic hydrogen is is the type of hydrogen that qualifies to be Ceda compliant so that's why that's that's spelled out um a new fuel for this IRP is r99 or renewable diesel uh we have represented r99 uh by using a distillate diesel price forecast from the 2023 eia annual energy Outlook um you might ask why we used a distillate fuel price to proxy as a proxy for r99 a couple reasons one there's not a lot of great publicly available data on r99 pricing at the moment um and being that this is an IRP publicly available data is always awesome if you can have it um another thing is our our own generation and fuels experts expect the price of normal Diesel and the price of r99 to converge pretty tightly in the next like one to two years as the Washington supply chain becomes a little more evolved um so it's it's both publicly available data and our and our own internal experts expect that to be a pretty consistent price as we move forward in time yeah I don't know if there's feedback here but happy to yeah go ahead Joel thanks Nathan um yeah I guess it's it's not it's not intuitive to me why r99 and just I guess isn't distillate diesel that's just regular fossil diesel right corre why those would converge in the next couple of years I I maybe I don't have a very good prior on like kind of how far apart their prices are now but could you explain that a little more why they expect those to converge yeah I think short answer we can definitely follow up with you in the feedback report because I don't think any of us are like the fossil fuel experts that can do that question Justice um but I'll say what I've understand understood from the conversations with them is it's just a supply chain thing like this fuel is readily available but not necessarily readily available here yet so they expect when it becomes readily available here that it'll but uh I think we'll talk to our we'll talk to our internal folks and get get a good response and writing to you because I think that's a good question just Emily making sure to flag that as a feedback report item thanks for that Joel Ezra I saw you come off a mute yeah I just I want to Echo what Joel said I mean it just doesn't make any sense to me that if you have a premium fuel with no emissions there's obviously going to be additional demand for that um we know that lots of people are hoping to use so-called renewable natural gas to meet climate goals it's just I just can't imagine that the price would converge with with the Foss with the greenhouse gas intensive diesel so you know more information about that would be helpful yeah okay we'll do I think I'll I'll provide one additional piece of context to you on how this price will be used um I think yeah both your questions are valid on that I think one thing that's important to note is like the gas price we put into the model and those like our existing combined cycle plants can see that gas price right and use it as its cost effective and it's it's like more sensitive to price the way r99 will be modeled in the new units is like because it's a liquid fuel it's going to be limited by that amount of storage right we're not piping in r99 we have a tank on site with r99 in it um so that there will basically those plants will be constrained by capacity factor and we'll have calculated out the amount of r99 that it can use and since these are peaking resources that's not a tremendous amount of fuel so I'd say we will get back to you in the feedback report about your questions because they're valid but I'm just wanting to point out that like if that price is subtly different there's not a there's not a huge model Dynamic that's getting shifted there we've given it a tank and we're filling it with a fuel at a price and it's limited in how much dispatch it can have um so hopefully I didn't just further confuse you but I guess it's it's not the same modeling Dynamics like giving the model $25 gas and that throws a wrench and everything that happens thanks for that Nathan and I see Joel's hand is still up do you want to follow up Joel um yeah I mean I'll be interested to see what uh a little more explanation in the feedback report on on that um but but I appreciate Nathan your your initial response at least um and I had a kind of a similar question on on hydrogen I know this is like a pretty big increase I think from where it was in the um 2023 progress report so just wanted to see if you had anything more you could say about what Dynamics caused that change um and and what kind of I guess generally on both these fuels it sounds like you got internal teams doing this analysis and and what what can this group expect in terms of sharing of that information either um you know during this IRP development process or at the end of the process um with the plan yeah that's a good question um I think I think again this is something that we should we should respond to in writing largely um because this like we have Niche folks that this is their whole job I think from my discussions with them a lot of it's there's a ton of different Dynamics one big one is like capex cost of electrolyzers like that's been understood to be much higher recently than than previously thought um but we'll reach out to our team and get you a better answer than than my best guess so yeah that's a good question Joel thanks Nathan for um we've probably already started pinging people in the background to to get their expertise in but we appreciate you kind of um answering as best you could here yeah anything else yeah I'm not sure if you actually finished this slide uh I think I did um I think I was pausing because I was expecting those amount of questions so I think we can move forward okay so now for something entirely different um I guess I kind of lied to you at the beginning of this slide deck because I had this box grayed out saying that we weren't G to talk about it um but I think it's important to point out in this 25 IRP both on the electric side and the gas side we've we've seen a pretty or we've been undertaking a pretty complete overhaul of energy Justice in general so I think last year in the Cascade Natural Gas rate order it kind of set forth these four tenants of energy Justice uh as a framework that utility should evaluate it under um and so we've really taken that to heart and kind of thought about how our analysis fits in this framework and how we can improve it um I think I'll touch on the two elements that are in bold here the first one and the recognition recognition Rec wow that's hard to say recognition Justice quadrant is we we have a new portfolio benefits and burdens assessment for each of the generic resources that's brand new to this cycle um and then in the distributive justice tenant at portfolio benefit analysis for those of you that followed our previous cycle um you might have seen this before um this is to help us like iterate and improve on portfolios to make them more Equitable as we reach a preferred portfolio um we're we will be presenting a similar framework um but we've we've updated and Rev revamped it pretty significantly um which we're excited to show you all soon so there's a footnote there um I think I'll stop there this is all very exciting but I don't want to steal the Thunder of the June 12th rag meeting that'll be solely focused on Equity um and there's been a lot of work here um so it certainly it certainly deserves the whole meeting so excited for that meeting upcoming but I'll stop at the moment I believe this is my last slide it is yeah so consider this a commercial for your mid June meeting but you know knowing that that mid June meeting um is still you know getting finalized anything from this slide that you really want PSC to focus on on June 12th all right well that was a good teaser um and I I'm really looking forward to that meeting in mid June thank you Nathan that was a great presentation before you disappear let's just see any other big questions big comments anything Nathan shared okay well you can take a step back and then let's bring Elizabeth on go to the next slide will so um there's been uh some uh attrition I think is the word of our our Peg members uh Alisa had to drop off Frey had to teach a class Megan had a conflict and uh John had a conflict Midway through so now it's a small group and it's cozy um but I still would like if possible just when we get to the discussion or even before if Joel Stefan Ezra and oh did Lauren also jop drop off a minute ago okay it's an extra cozy group any of the uh arpeg members who are still here when we get to the discussion let's just see each other's faces so um Elizabeth do you want to jump in yes um so thank you for those who are staying with us on this uh beautiful sunny Friday afternoon uh lunchtime um and thank you for everyone for the great presentation this has been great going through a lot of information going through the portfolio models our electric price modeling and some of our assumptions so what I'm going to do is now we've set up kind of our reference assumptions we are going to go through some of the sensitiv acties iterations off of those reference assumptions this will help inform information where we should be going with this where we should be going with the final the preferred portfolio um and just really help inform some of those decision processes as well so I think next slide so just some things to keep in mind as we go through this discussion just noting that as the sensitivities lists can totally balloon out all these uh what if questions just we asked to keep in mind that we do need to prioritize some of the work we could go crazy with so many sensitivities to run but we just want we're going to try and prioritize where we should be starting um so we have a starting point to prioritize some of this work and we can work through it as best we can um but we do have the deadline to get the IRP finished so some of the things to keep in mind while we're going through the list is are there ideas for other sensitivities or are we looking in kind of some of the right direction of where you think we should be going with some of these sensitivities and where do you think we should be prioritizing some of this work so when we start going into this analysis we'll be prioritizing the specific points and then we'll kind of work our way down the list as we get through some of these sensitivities so that's also something to think about as we go through this as well so guess next slide so how the sensitivity analysis works as I mentioned um we set up this reference portfolio so that's where Nathan was taking us through some of these assumptions setting up our reference portfolio and then the sensitivity analysis we start changing some assumptions and so what we'd like to key into is specific assumptions to change each one um and see how that assumption change will change the builds and how this portfolio looks and some of the costs the cost of the portfolio as as well and so one of the categories looking at is the transmission constraints um we are looking at various transmission constraints so we went in with some assumptions they're very limited assumptions um where we're looking at what if we have more limited transmission constraints or there's upgrades to the system um so that would be under transmission constraints looking specifically at those assumptions some other categories being the social cost of carbon this is looking at Social dispatching social cost carbon or using it a different way um our Cedar so these are around the cedar requirements and the whack rolls for looking at different requirements um electrification so this is like building electrification electric vehicles um and then other because I was very uncreative uh this is where a bunch of the other one-off sensitivities just ended up and couldn't think of a better category to call it and then the equity and customer benefit indicators I'll touch on a little bit here but that will actually be really building off of our next meeting when we start talking about that portfolio benefit analysis and trying to maximize some of those benefits in there uh so next slide so this is really my last slide I'm going to go through it but as part of this presentation we also did give out some more information a little bit more notes on some of these sensitivities as well but I'll just be going through this this slide uh this is where I like to get discussions what you think about these different sensitivities and where we're going with this if you have thoughts on different ones or looking in a different direction we like to get some feedback on that as well um so under the transmission constraints when we presented the regional transmission um our reference assumptions going in is looking at the 2021 and 2022 um cluster studies of V cluster studies and we're assuming 100% available of that transmission so this first one came from feedback from that because it's like are we going to get 100% what if we get less than 100% available so this first one would be lower availability of the transmission from the cluster study um so that was some of the feedback we received through that meeting other ones being kind of a delay in the availability what if it's not available during the time frame we think it should be available um and then several around expansion of the transmission uh Regional transmission to get to more resources a possible 2035 expansion uh 2038 expansion based off of the 23 cluster study for the availability of those resources and then a combination of 2035 and 2038 expansion so this should be increasing transmission um over time so right now their assumption being that we only have so much transmission available up to a little past 2030 for the availability if from those cluster studies and this will be more transmission available on to the Future to help meet that 2045 requirement and then the last one discuss discussion being is some feedback around do we need actually firm transmission for the renewable resources these are variable energy resources and so this one being instead of firm transmission so the subm going in is that we have to get firm transmission at full name plate for the resources to make sure we can account for it when it's available in every hour and it meets Peak needs so this one being what if we don't get firm transmission we are using non-firm transmission so this is using available transmission um during the hours when it's available uh risks being on this one that not all hours you might not be able to get available transmission this is really building off of when the transmission could be available so there could be some more curtailments than expected but the idea being that what if we were to use that non-firm transmission um you don't have to build as much and you're just using what's available so that's under the transmission I don't know if we want to stop questions comments feedback where we're going with that yeah take a pause there anything for Elizabeth that at this time not seeing anything Elizabeth you can move along gu I can't help myself but break in a little I mean I think that um this will be very enlightening I think it might suggest that we um need to look at it more which I know you don't want to do that once you look at the results then start looking at other scenarios but I mean I think the issue of the impact of having more transmission on cost and feasibility of Meeting those ca constraints is going to be one of the fundamental outcomes of this whole process so really look forward to learning from that and seeing where PSC takes it you know in the future guess just a comment no thanks Ezra and by all means the whole step back step up thing does not apply when it's a small group like this everyone who's on the call please just like your voices um are welcome right now so Joel what what were your your thoughts um I mean I I I like mostly want to just agree with what Ezra said I think that it'll be nice to see kind of what the impact of different potential transmission Futures has on the the portfolios that come out of the analysis um and I guess I also wanted to ask kind of in the context of looking at these different sensitivities um maybe a reminder of the uh sort of order of events and like what the rest of the process looks like between now and a final IRP um and whether this is sort of our last chance for exploring other options or you know if we will be able to see some of the results of these sensitivities and potentially build new ones on them as we learn more from what that analysis shows um no you're correct um again these sensitivi can be starting points and we may learn something from them and start kind of pulling on that thread and exploring down that level and I agree it's really important to be able to we start with some sensitivities but we also need to keep it more dynamic as we learn things it's like okay let's explore down this piece so right now what we're doing is we're setting up our reference um we'll be kind of going has down into modeling for the summer once we get everything set up and running and then we'll meet back I think we have some time set up for early fall um in which we'll start going through some of the draft results we have and again that will be we'll go through some of the draft results what sensitivities we run how results may be looking and getting some more feedback on where to go with this and then that will also help develop into maybe some more sensitivities looking at some different things and really kind of going toward where should we be going towards with this kind of like preferred portfolio um and leading into to that kind of draft that'll be end of the year thanks for describing the pathway from here on out Elizabeth um and for your comments Ezra I'm not seeing anyone else or their hands so um yeah you can keep walking through these sensitivities yeah um so next categ will be the social cost carbon Cedar requirements so a lot of this is coming out of some of our uh the whack roles and of our conditions to look at the social cost of carbon modeling as a dispatch from some of the feedback we received and then looking at these um we've nicknamed them kind of the nosea portfolios um as a requirement from The Wack rolles to look at what if we didn't have the Ceda requirements what would that look like as well um and then under the these are the electrification scenarios so the building electrification this is one I've just la them as high and low so this one will be working really closely with the gas portfolio modeling and so under the gas portfolio modeling they're going to be setting up what that would look like and so um right now we have a separate electric model and we have a gas model we don't these are all these are all separate models so there's transmission planning there's electric planning electric resource planning there's the gas utility planning and so under the gas planning they're going to be setting up these scenario sensitivities looking at various condition conditions for electrification and then they'll be feeding us the increase to the electric loads and under those conditions we'll be looking at how those increased to Electric loads will be affecting the possible need for new resources and what that mix of resources and the cost could look like on the electric side as well so these would be the combined portfolios with gas and electric we also looking at possible um or looking at the electric vehicle forecast so we had a meeting back in January we're talking about the electric vehicles there's a lot of unknowns where this could be going it could be going up it could be going down so we'll be pulling some of those forecast and looking at the range of where the electric vehicle forecast could be going as well and combined of the building electrification and electric vehicle forecast and the impacts onto electric needs I think I saw some hands going up go ahead Joel thanks yeah no I uh had a lot of notes on this slide so I appreciate this being brought up as a discussion point and um planning to take full advantage um on the social cost of greenhouse gas and Ceda section um I had two um two questions on that um so I think the the use rulemaking is something that um I think Tyler alluded to earlier uh during his portion of this presentation um there were Draft rules for that circulated um uh earlier this month I think May 9th and uh then I think just yesterday so maybe this is breaking news for some folks there was a another post to the docket um requesting analysis on like what the implications of those Draft rules would be on kind of costs and portfolios so I would maybe suggest that as a potential sensitivity here this might be a good place to look at what the impact of those Draft rules would be on psc's portfolio and and the costs associated with that for anyone who's listening the dock it for that if you're interested and I um I haven't read through the whole thing myself so I am I'm just putting this information out there for others to to help absorb as well but uh UE 21083 is the docket number for that anyone's interested in checking that out and for everyone's awareness um so that was the first one I don't know if you have any reactions to that there was one other point I wanted to touch on in that column the social cost and the and see the column um for the first point on the draft use roles um we are not planning much for this but we can get back to um once we figure out what's it came some of it came out yesterday so I was focused on this meeting um y totally fair so yes once we get more information we can see what we do cool yeah I'll just put that out there and uh um yeah feel free to absorb that and and think about the right approach but I wanted you all to know um the other one was um about something that I think Nathan mentioned earlier um the way that PSC is approaching the um inflation reduction act incentives and as I understand it you all are including sort of the standard across the board incentives for generic resource is and I wonder if exp it would be useful to explore what the impact of some of those bonus incentives that are admittedly less um you know less certain but could potentially you know push the balance towards certain resources over others if they were achievable in in certain projects so wanted to throw that idea out there as a potential um kind of Ceda is social I thought it sort of fit into this column anyway um so interested in any reactions but wanted to put that idea out there um and then I had one other thing on the electrification side unless there's anything on that Elizabeth any reactions to that one before we go to electrification um I mean we can look at the bonus incentives see what we can do I'm not definitely not promising much like you as we said it's very specific um but we'll see maybe what or at least list out what they might be looking like okay yeah sure um the the other oh Philip yeah go ahead yeah yeah I I just kind of wanted to jump in on that one you know I think that uh just to keep in mind about that sort of you know if there's specific projects that might get a a bonus uh credit um it's not going to increase the need you know what I mean um it might it might impact the the what you fill it with like maybe you would pick that you know the special solar instead of a regular solar or the special solar instead of a a regular wind uh you know with the regular level of incentives it's not going to increase the amount that you're going to acquire you you know what I mean um and it it's like knowing in advance if you got a A one you know if you've got something bid to you that reflected that value I don't know why biders would give that value all the way but uh you know if we were looking at building you know with our own self builds I think it's it's it doesn't seem like one that works well for a sensitivity you know what I mean because like in in in the real world actual results May bury you know it's not going to crank up the the the the you know like oh we're gonna go out there and acquire an extra 500 megawatts of of Renewables because of that you know what I mean especially on a generic basis so um that one feels to me like it's it's probably one that we ought to uh identify uh in the in the in the book you know what I mean that that this is there's these these potential bonus incentives um and you know actual results May Vary um that was the one I was just thinking about that right it would be it'd be hard to kind of cycle through oh well there's a you know we're going to do 20 different sensitivities for each different type of resource and different levels of of unique benefits that they might get so okay yeah no that makes some sense and I yeah maybe it uh maybe not as a as a sensitivity but maybe as kind of a post post run financial analysis or some I don't know I'm trying to think of like how you could still include that in in the in the IRP but maybe I don't know that's just that's a just a thought and also you know maybe it's better addressed in the RFP process or or somewhere down the line I'm not not totally sure but that that was something that came to my mind I guess as uh Nathan was was talking about that thanks thanks for weighing and Phil were there other questions Joel or comments I think you were talking electrification yeah I just so on electrification I I guess I just had a question about kind of how how PSC is approaching um you know Electric ification I think is is a little simpler when it's sort of in psc's dual fuel area and I'm wondering if there's been engagement with know partially overlapping utilities that that might be impacted by the way PSC is going about its planning process for electrification that um and and how you're coordinating with um with those other utilities to try and make sure that your planning assumptions don't kind of you know aren't aren't running against one another in a way that could lead to suboptimal results let's start with that question then we'll Turn to You Alisa thoughts on on kind of dual planning jurisdiction environments um feel free to call friend too feel free to call friend too Elizabeth yeah yeah I'll got you um you know we can uh we can you know maybe in the feedback report we can kind of summarize but you know I think that we we've done didn't we just do a a public the public webinar explaining uh what we were doing there uh but but I think we'll kind of look back at that and see if we describe that in much detail but I think that's a a place we can do that you know I'm sure we have it written up already what we're doing right that's all kind of probably part of that stipulation o um kind of thing so uh we'll see if we if we've already written written it up somewhere we'll point it at you or point you at it and uh if not we'll we'll address it in the feedback report just kind of a high Lev summary how how have we been coordinating how we will coordinate in the future is is a different story maybe right but at least we can say what we' what we've been doing thanks Philip and Emily just marked that as another uh feedback report topic on Dual territories um very good thanks for weighing in yeah Alisa please oh you're muted of course um I apologize that I've had a bounce in and out but um this uh reminds me that I was asked about like weighing in and I'm not going to completely weigh in today still on the um social cost of greenhouse gas as the sensitivity of the dispatch cost but it got me thinking about Ceda you know and thinking back to my days when I was at Seattle kind of in the same thinking about how do you model all these things and I'm curious um too when I think about the cost of emission right the the greenhouse gas neutrality standard um be um before 2045 how does energy how is psse thinking about energy transformation projects um I may have missed that but there's multiple way Pathways right um to um offset offset those um emissions and you may have emissions from you know Market purchases um or direct emissions and so I think that needs to be in our thinking about how to advise um psse so um maybe they can give us an idea about that um those energy transformation um projects and what they're thinking about doing for this IRP on that hope that's a decent question yes so the energy transform projects count towards the 20% so for example in 2030 we have to meet 80% with renewable non-emitting generation the remaining 20% can be with what is the alternative compliance this can be unbundled recks or energy transformation projects so for this IRP we are working on kind of essentially a wck price and so we're going to be looking at a potential like a fundamental cost of a wreck is what going to be calculating out as the placeholder for that alternative compliance in terms of energy transformation projects we've talked about them back and forth but we're still waiting um on information on how to take those projects and convert them to essentially a megawatt hour number for the compliance piece of it and so that's kind of the piece that's missing for those um so for now we're just keeping in that kind of unbundled wreck or this fundamental wreck price as our placeholder for the alternative compliance um something we can think about is like I said we're looking at a fundamental Rec price um it's kind of an outside the model calculation but we can look at what if it's a higher or lower cost it's there's a lot of unknowns right now still trying to work towards that and then to get to that 2045 we need to be 100% um non-emitting uh renewable energy so no alternative compliance going into the 2045 yeah yeah no I thank you I was thinking about you know this um no social or the social cost in dis dispatch costs but maybe you know it's really looking at it after um dispatch and you know this wreck price like the ceiling price on the wreck it might be this social cost of greenhouse gases um so um as a just a way to differentiate the cost of the portfolios I feel like that when I was at Seattle that's what my team was uh we were doing some sensitivity on that and used that as um a book end and I know you have different social cost of greenhouse gas costs that you're looking at but um so that was one way I've been thinking about it and I just wanted to share that um thought process um as I'm looking at these slides and getting back engaged in um but uh look forward to hearing more thank you thank you thanks Alisa Elizabeth how about you finish kind of walking through these and then we can have hopefully you know seven eight minutes for the big picture question that you posed in the beginning oh unless Philip did you want to come back on yeah go go ahead pH I'm sorry I just wanted to jump in just wanted to jump in real quick you know um Alisa I'm not sure uh if after you uh jump ship from uh from Seattle City Light down to panck um that you probably did that when ecology was in the process of doing a Ru making on those energy transformation projects um they haven't finished so that's why we're kind of still not much we can do because we don't know what the rules are okay thank you yeah I just you're right I this is all in process and I'm not as up toate on everything um and that's why it's good to participate with this group to um stay in touch with all these processes but um you know there's other ways to kind of book and some things or look at costs so just trying to reflect on what when things are unknown what can you do um so it's yeah you know it's always hard to kind of finish an analysis but at some point you have to yeah yeah no great question though thank you good all right Elizabeth let's take pick us home here and then we'll zoom out okay um so this is next one under kind of that red box these this is is a request that came in or some feedback we received through the 23 progress report so in this feedback we received right now what's happening is when we look at Energy Efficiency so this is all of the conservation coming in it's like well over 1500 measures we're looking at and what we do for the IRP is we take all these measures and bundle them by costs so when we talk about um the Energy Efficiency bundles what we've done is we've bundled them in by cost so and we've bundled them by cost using their energy value so a dollar per megawatt hour number is how we're bundling them all together and then this will bring it down to like 13 different inputs into our models and pulling out bundles by their cost levels and so what we're doing what the request was is to rebundle by their capacity value and so instead of looking at their energy value we look at all the measures and now we're Ling them by their capacity value a dollar per KW year value and so by bundling them by their capacity value instead of their energy value would we get a different result doing this way and so that one is so that was the request that came out the 23 part part so we've been working with Cadmus to get these bundled to get everything rebundle by they were using their winter capacity since the winter capacity is still the highest system capacity and so by rebundling them we'll be getting in the bundles that way everything is still going in the models we'll still have the energy values we'll still have the capacity values it's just would we get kind of a different conservation point or a different value on the conservation if we were to look at a little bit differently by capacity so that's what that sensitivity is looking at um the second one the W planning so this last meeting we had in May uh we did talk about W brought up the idea of should we be using the r planning margins or the um or estimation of kind of a long-term planning margin using RP versus our work done by E3 the feedback we did receive was people would like to see it kind of how does this change the portfolio bills how does this change things so what we're doing is we're going into our reference assumptions using the E3 analysis and then we'll be running of sensitivity using kind of these wrap estimations of the long-term metric so we can see how this would change builds and the portfolio and costs as well um and then the last one I'll give a little teaser of this one so this one be discussed a little bit more the kind of the I think it's June 12th meeting um under the portfolio benefit analysis and just noting that under the portfolio benefit analysis under the whack rules we need to do this maximum customer benefit portfolios that would be one of the sensitivities we run trying to maximize specific um metrics we've also um received feedback like we should also be looking at some increased distributed storage is in relation to some of the vehicle to grid discussions that have been going on and using that so and then I have a question mark because uh this one will be developed out more as we work through that portfolio benefit analysis and trying to weigh um out the different metrics um and kind of bringing more equity and enabling into the portfolio as well and I think that rounds out what we have very nice so in these last seven minutes let's just do the discussion that you prompted everyone with I think it's the next slide is that right will oh nope let's go back I think it was my first slide actually ah sneaky there we go so for the group that's here um on this sunny Friday you know are there ideas on other sensitivities how would you prioritize the sensitivities for schedule and workload you all have given some really nice and important feedback to to PSC already just in our conversation but yeah anything else you'd want to add Ezra stepan Alisa Joel thoughts from you all well I talked about you know that I think that the transmission stuff will be incredibly important I think you know there are some bold assumptions that you've talked about and and you have to make assumptions but the whole question of r99 availability and cost um and you know and Emissions actually associated with that fuel I think it's going to be really important to um you know explore deeply and make sure we're not just taking a stab in the dark costs of um smrs small SNR small nuclear reactors um I think you know historically that's an area where all forecasts have been horribly wrong so certainly we want to uh look very carefully make sure you're covering your basis on that you know everything else since you guys have to do all the work modeling it not me so great thanks for that Ezra I see you are on camera Lisa thoughts from you well I've you know this transmission question is really complicated um you know because right now there's still a lot of unknowns about what what will get built and can get built and there OPP you know but there's also opportunities maybe for some efficiencies on the existing system so I think you know um you know I think just being clear on what you're assuming um and giving us opportunities as you're sort of further developing it uh to weigh in will be helpful yeah just just following up on that for a second I mean you know I mentioned reconductoring earlier on it's not something that I understand terribly well but it is certainly something that people in the industry are looking at as a way to get around transmission constraints that's less costly and timec consuming and politically fraught um so uh if that's really not something that PSC is considering I guess it good to understand why that is maybe I'm just totally off base about that as a viable alternative I think yeah yeah I'm sorry um yeah Ezra I think that's a really good question and um you know it's uh for the IRP itself it's not that hard to change the Assumption on when transmission would be available or what the cost would be right that part's easy I say easy because I'm not the guy who runs the model that's Elizabeth and her crew right so for me it's easy to ask that question um but the the challenge I think is uh uh as we start really digging into this as a company um it's going to take more right we we it takes time to develop those assumptions you know what I mean and uh uh that's that's what there's I just don't think there's any way in this IRP timeline that we would be able to develop assumptions on what if we were able to sweet talk BPA into reconductoring the line to Montana what would that cost and what would it do for us right those those I mean I don't know if if Ellen online but um you know those kinds of transmission studies um are are probably a whole lot more complicated than you know than I think right because it's it's a much bigger deal change the you know increase the you change the conductor all the way to Montana well it doesn't just right it's not just a a pipe right it's connected to a whole grid and we don't really know how that would affect it um without probably without some study so um I think that uh what you would what we wind up seeing in the IRP I will'll definitely talk about reconductoring and uh uh you know I'm not sure how deep into that discussion we can go in terms of saying let's figure out how to how to put this into the hopper for uh not just our local transmission planning but also Regional Regional transmission planning processes as well you know I mean that's a big deal I think it might wind up being a great a great opportunity right but it's going to take it's G to take quite a bit of time to figure out what it will cost and what the effects would be so not for this IR I don't think great and elanar I saw you come on camera did you want to add anything on the transmission front yeah no I I I just want to say you know it's a great question and I know reconductoring and advanced conductors have been getting a lot of attention lately and definitely something that that is in our our tool belt of things that we can consider and I will note that to um part of the BPA evolving grid projects that are going to um part of that 2022 cluster study that we're assuming does involve reconductoring two of their lines so it is very much in play at least for like the the cross Cascades path but it's also important to understand and I think to Philip's point is that there are a lot of other factors to take into consideration as far as the types of constraints we have on the system so if it's a thermal constraint reconductoring may be a very viable option but when we're thinking about things like voltage stability or transient stability issues reconductoring is less effective so it's it's a complex problem and it will require a lot of a lot of analysis and a lot of consideration as we think about how it fits into into a future transmission portfolio yeah I mean those those points obviously are very well taken and very important and it's I not understating the complexity the but my point is somehow or other you need to know what the benefits are are you know so that we can decide whether the degree to which certain constraints should be looked at and you know in Greater depth and I'm sure those studies are going on I BPA is probably doing those studies given what we've learned about the transmission constraints in the region I'm sure that looking at all of the options so yep absolutely thank you for that conversation I have five tabs open on reconductoring now um we have about uh we're just shy on time but I just want to let uh Joel I don't know if you had a moment to have these big questions in mind anything you'd want to add Joel um I had one other sensitivity that I was thinking of and I know we're talking about prioritizing and workload and all that so I think it could probably wait until the like after the first round and then see how that goes sort of bucket of sensitivities but it was one about demand response and how um it seems like psse has had a lot of early success in launching and scaling up its demand response programs maybe faster than it thought possible a few years ago um and so it was It was kind of an potentially exploring the uh um you know the ramp rate assumptions that are built into the conservation potential assessment and seeing if a faster demand response uh ramper uh would result in more of that being picked up I think in the 23 progress report there was um uh you kind of like mixed out demand response uh that got picked up in the preferred portfolio if I recall correctly and so moving some of that forward to see if you know if that's if it's that valuable a resource that that maybe it's worth putting some more effort into um into bring that online at a faster rate if that's possible is maybe another question but um given there it's sort of a short history but a pretty positive history so far with demand response as I can tell um uh that was the idea the sensitivity where demand response could come online a little quicker than than the CPA anticipated and then I also just wanted to say also very interested in G enhancing Technologies including reconductoring and so would love to um know more about how PSC is approaching look at that making sure that the benefits of those can be realized thanks Joel for being prepared for some of those ideas I think Elizabeth he'll take it back with your team and do some digesting um I want to note because several of your colleagues were not here the this IRP team will reach out by email with this kind of question so your colleagues can respond directly to it as well so PSA will take these live comments as well as some written comments um speaking of comments we are coming up to public comments Elizabeth thank you for thosee that presentation and that discussion um will can you jump ahead two slides three there we go next steps um so we've uh talked about the equity in the IRP a few times in this conversation so in June there's two meetings focused on it one is the public webinar on June 6th and then June 12th will be an AR rpeg specific meeting also talking about equity in the IRP and the work that psse has been doing behind the scenes in between those two dates um the feedback form for this meeting uh is closing on June 7th um and my guess is that's roughly when maybe PSC would want to hear some responses from your absent colleagues um with the discussion question but you'll probably see that in an email uh so with that in mind I think we have arrived at public comments so Pauline if you could allow people to uh raise their hand all the participants to raise their hand and then we'll start promoting people in the order in which we see them all right we have a hand from Jim Adcock let me turn and share my screen here Jim can we hear you I don't know can you hear me now we can hear you yeah good to hear you yeah go ahead your two minutes start now okay Puget is not allowing enough real participants I.E a small cozy group for any kind of meaningful public participation and a fair representation of public interest this Puget restrictive action is not fair to rate payers and does not meet the public participation requirements of IRP law I do thank UTC staff and public counsel for their intelligent questions and comments Washington state law every Electrical Company shall supply furnish and Supply such service and Facilities shall be safe and in all respects just and reasonable destroying the human race is not safe just nor reasonable slide 39 Puget is not in fact engaging with interested parties as myself who've been in this for 15 years rather Puget is actively avoiding such engagement slide 39 2 27 the social cost of greenhouse gas is not currently directly imposed on pit just dispatch today that doesn't mean it can't be imposed in the future leaving Puget with stranded resources such as the new natural gas peers and in any case these are real damages which pet is unfairly imposing on human society including real human deaths I.E Bressler mortality cost of carbon slide 32 I am happy to see p honestly and openly discussing the First full range of possible resource additions they are considering including fossil fuel peers and nukes slide 5 I am disappointed that Puget is not yet considering the real social cost of greenhouse gas as best understood by modern scienti which is about $230 a ton currently rising to about $300 a ton in 2045 according to the EPA about three times higher than Puget is currently considering if these much higher real Greenhouse GS costs are used then P would end up with an extremely different research results slide 38 I do not we're wrapping up so just last sentence or so okay slide 38 I do not consider renewable hydrogen to be a realistic fuel choice because the renewable electricity electricity used to make that hydrogen can be used better less expensively for example to power heat pumps and electric vehicles my last comment was on reconductoring but I think you've heard that one already thank you very much thanks for your comments Jim appreciate those let's look back at the list here any other hands I am not seeing any other hands from observers of today's arpeg meeting um looking around so with that in mind um let me stop sharing I'll just kind of look at yall and wrap us up here so thank you all for your participation and for the five or six other arpeg members who were able to join earlier today um I just want to you know PSC over time I've seen you condense your slides so that you can have more time for the Q&A and I just really wanted to say I appreciated moderating the Q&A today there were a lot of interesting questions a lot of homework I need to do on the side to catch up with you all and I thought the participation for those of you who are here today was really meaningful and uh PSC thank you again for your work putting together this content so we'll see you all at your arpeg meeting on June 12th and until then I hope everyone enjoys this nice weather and I hope I just didn't jinx us by calling in nice weather um have a wonderful afternoon everyone thank you thanks so much Sophie thanks