Board of Directors Meeting...• Conduct siting study and establish transmission line route alternatives . Summer 2018: ... overall rate design . Summary ... coordination transactions

Board of Directors MeetingMay 31, 2018

Transmission Line at Meadow Springs Ranch

May 31, 2018

• Provide an update on the Platte River wind project• Discuss significant project milestone dates and overall

timeline• Communicate the upcoming city process and the roles of

city boards and commissions• Provide an opportunity for board member questions and

discussion

Purpose

• Jason Graham, Water Reclamation and Biosolids Manager• Daylan Figgs, Environmental Program Manager, Natural Areas• Carol Webb, WR&T Manager• Tim McCollough, L&P Operations Manager• Christine Mikell, ENYO Renewable Energy• Jeremy Call, Logan Simpson

Project core team

Joint Venture between MAP and Enyo, LLC

Enyo Renewable Energy

Enyo, LLCChristine MikellFounder & [email protected] S Power Plant LaneSandy, UT 84092801-455-1045

MAP Renewable EnergyAaron ZubatyManaging Director & President [email protected] El Camino Real 5 Palo Alto Square, Suite 700Palo Alto, CA 94306650-324-9095

Enyo Renewable Energy is a wind and solar development company specializing in developing utility-scale renewable energy projects. We treat our landowners as family and collaborate with local governments. Our specialized knowledge of the Intermountain West coupled with our focus on building relationships allows Enyo to build for the long-term and for the benefit of communities and our partners.

The Enyo Way

Enyo Renewable Energy

Roundhouse Renewable Energy project overview

Name RoundhouseProduct Renewable Electric Energy – all energy, capacity, and

environmental attributesAmount 150 megawatts (MW)

Start Date/ Commercial Operation

As early as March 31, 2020 but no later than December 31, 2020

Contract Term Approximately 21.5 years

Location 30,000 acres of private and state land in Laramie County, WY with transmission line in Larimer County, CO

Delivery Point Platte River’s Rawhide SubstationTransmission Output will be delivered directly into Platte River’s transmission

system through a high voltage lineBenefits Triple Platte River’s existing wind capacity and increase

delivered, non-carbon energy to owner municipalities to 48%.

Roundhouse Renewable Energy Project

Proposed transmission routes*

Rawhide Energy Station

*Routes subject to change

Roundhouse project schedule

2018 2019

Spring 2018:• Early outreach

meetings• Conduct siting

study and establish transmission line route alternatives

Summer 2018:• Proposed transmission

line route finalized• Resource surveys and

other supporting environmental analysis

• Public outreach• Prepare 1041 application

Fall 2018:• Water board review of

environmental analysis • Present to other City of Fort

Collins boards• Submittal of 1041 application • Referral agency review• Private easement acquisition

Winter 2018:• County Planning Commission

hearing• Board of County Commissioners

hearing• Water Board recommendation

of easement• City Council: two readings of

Ordinance Approving Easement

Spring 2019:• Acquisition of executed

easements from City and property owners

• Negotiation of Development Agreement (if required)

• Application and issuance of construction permit by county engineer

RHRE Website

Project core teamPartnership with Platte River and ENYOEnergy by DesignAgreed upon mitigationDetermine recommendation

Boards and commissions

Water Board (recommendation)Energy BoardNatural Resources BoardLand Conservation and Stewardship BoardOthers as needed

City council

Final decision maker on MSR Easement request

Questions?


UPDATE – 2018 GENERAL

ASSEMBLYS A N D R A H A G E N S O L I N / C A P I TO L

S O L U T I O N S

CONTEXT

• 120-day session

• Split control of houses

– narrow Republican control of Senate

– Wider Democrat control of House

• Substantive issues from previous sessions– Transportation

– PERA

• Looming background issues that defined session– Upcoming 2018 elections

– Sexual harassment claims

PREPARATION FOR SESSION• Meetings with local delegations and

others with an interest in utility matters

– Discussion and eventual distribution of ZNC

• Review of bill titles

• Rumors

• Allies

ISSUES TRACKED

• Colorado Energy Office

• Climate Change

• Broadband

• Energy Storage

• Energy Subsidies

• Health Effects of Wind Generation

ISSUES WITH ACTIVE

INVOLVEMENT

• Electric Transmission Right of First Refusal

• 8-1-1 – Call Before You Dig

FATE OF LARGER ISSUES• Transportation Funding and Finance

• PERA

2018 ELECTIONRace for the Majority The Legislative Seats in Play

Governor’s Race


Strategic Plan May 31, 2018

Purpose

• Strategic initiatives

• Changes• Incorporated board suggestions• Market participation

• Three to five year time horizon

• Look and feel

• July board meeting - Approval

Strategic initiatives• Enhanced customer experience

• Collaborative communications and community outreach

• Resource diversification and alignment

• Infrastructure advancement

Changes• Incorporated board suggestions

• Energy markets

• Headquarters

• Formatting


2018 Solar + Storage RFPProgress Update and Next Steps

May 31, 2018

• RFP Issued on 2/21/18• Non-binding offers received from approximately 36 distinct bidders• Over 80 bid structures across three delivery years = 240 bids to

evaluate

Overview

2018Feb 21

RFP released

Mar 30Bids due

Apr 24Short list

Mid-JuneTerm sheet negotiations

Late-summerSign PPA

• 36 individual counterparties submitted solar and storage bids

RFP Respondents

174 Power Global Community Energy Geronimo PNW Solar

AES DE Cypress Creek groSolar Recurrent Energy

Altus Ecoplexus iBV Energy Partners RES Distributed

Apex Enel Green Energy juwi Sandhills Energy

BioStar Enyo Lendlease Saturn Power

Bofat Forefront Power LightSource Strata Solar

Bona Terra/NGI Frontier Renewables NextEra SunPower

Cenergy GCL New Energy Nikola Torch Clean Energy

Clenera GE Solar Origis Wirsol/Wircon

Cost • Evaluation based on proposed PPA price; estimated value of energy and capacity; as well as the cost of transmission and losses for energy delivered to Platte River.

• First cut based on price of solar portion of proposals.Location • Evaluation based on identified site at Rawhide versus

other siting options proposed by bidders.• Projects over 40 MW in size removed from

consideration as pricing at scale was not a significant differentiator.

Project Viability • Evaluation based on project viability and estimated probability that bidder will be able to successfully complete the development on schedule.

• Bidder’s experience with solar development (based on total installed capacity) and the number of projects 20 MW or larger.

• Viability of proposed energy storage technology.Risk Management • Based on financial qualifications review and term

sheet negotiations.

Short-List Selection Criteria

C

C

C

AB

A Preferred location for additional solar panels

B Secondary location for additional solar panels

C Executed third-party land lease options

Rawhide Land Use

SolarAverage = $37/MWh

Tightly-clustered pricing

Pricing for existing RH solar

Storage

Wide pricing range which requires further review

Bid Ranges – Projects < 40 MW

Average = $1.2 million/MW

• Platte River’s share of carbon-free resources is approximately 30 percent• Relative to municipal deliveries• 50 MW wind additions add about 5 percent • 150 MW wind additions add about 15 percent

Share of Carbon-Free Resources

0%

10%

20%

30%

40%

50%

60%

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031

Carbon Free Energy Produced/Native Load

Base % Carbon Free Carbon Free % with Wind Carbon Free % with Solar and Wind

2021 Wind Additions

2020 Solar Additions

Share of Carbon-Free Resources

≈48%

≈32%

≈50%

• Platte River will focus on four areas of optimization and risk management

Operational Risk Management

Negotiate for the flexibility needed from the vendors to facilitate the handling of surplus energy

Supply Management

Determine methods to manage Platte River’s existing resources to accommodate surplus energy

Generation Management

Look for market opportunities to manage Platte River’s long position

Market Operations

Perform studies to evaluate the most economic interconnection strategyInterconnection

Next Steps• Narrow short-list RFP candidates down to 3 - 4 vendors• Develop draft term sheet(s)• Conduct an in-depth evaluation of bid structures:

• Interconnection• Counterparty financial health• Operational impacts

• Finalize term sheet with the preferred vendor• Make regular progress updates to the board• Negotiate a final PPA with the preferred bidder late-summer 2018• Wholesale solar pricing program will be evaluated along with the

overall rate design

Summary• We appear to have cost-effective options for adding

additional solar to our portfolio that will give member options.

• While storage options are currently not cost effective, it will provide Platte River with valuable experience operating battery storage systems.

• Additional details will be provided on our short list providers of solar and storage systems during the July Platte River board meeting.

Questions?


Managing Renewables in Markets

May 31, 2018

• Market Structures• Bilateral Markets (current)• Organized Markets (future)

• Managing wind and solar, intermittent resources, in these different markets

• Summary

Introduction

Market Structures

Bilateral Organized

Platte River actively manages the market through counterparty

relationshipsAn independent operator manages

the market through electronic structures and market rules

A reciprocal obligation between a willing buyer and a willing seller under mutually agreeable terms for a specified period of time

Bilateral Agreements / Markets

• Energy, capacity, or a related product • Provides price certainty through short and long-term contracts and generation ownership

• Loads and resources are balanced • Differences between contracted energy and produced / consumed energy are handled financially through the purchasing / selling of coordination transactions and changing the output levels of owned generation resources

• Units are dispatched by owner / operator • Match resources to load

• Operate with a set of pooled resources with independent operations of wholesale markets for energy, capacity and ancillary services

• Transmission is central in market design – a single tariff exists with open access and non-discriminatory services

• Load and resources settle individually in an organized market

• A Regional Transmission Organization (RTO) serves as the centralized operator for committing generation and serving load on a least-cost basis

• Day-2 Markets include day-ahead unit commitment, real-time unit commitment and real-time dispatch

Day-ahead loads

Day-ahead generation

Bids/Schedules

Determination of Clearing

Prices

Day-aheadPosting/

Recalibration

Market Operations

Organized Markets

• Renewable generation is intermittent which can be difficult to manage

• Intermittent generation requires backup reserves on the system

• Staff are required to make every reasonable effort to balance loads and resources on a day-ahead and hourly basis

• Managing resources is a binding commitment requiring up to 90 minutes before the start of the hour

• Minute-to-minute balancing is handled by our Balancing Authority; PSCo

• Once a decision has been made and the hour begins, there are only two options to manage that decision in a bilateral market:

• Follow intra-hour changes in load with increases or decreases in our generation output; or

• Purchase regulation from our Balancing Authority; PSCo

• The current cost for these services is $3.35/MWh for wind and $0.97/MWh for solar

Managing Intermittent Generation in a Bilateral Market

Bilateral Market Balancing

500 MW Load

500 MW Load

500 MW Resources

Resources• Rawhide• Craig• Wind• Solar• Hydro


500 MW Resources

500 MW Load

170 MW Renewables


Renewables• New Wind• New Solar


500 MW Resources

500 MW Load

170 MW Renewables

170 MW Sales


Renewables• New Wind• New Solar


• Intermittent generation is much easier to manage in an organized market

• Balancing loads to resources is no longer required as a market manages imbalance within the hour

• Load and generation are separate

• The market buys your generation

• The market sells you what you need to serve your load

• The market effectively allows regulation up / down to be done on a regional-wide basis within the hour. For instance, a single generating unit may regulate or balance generation and load for several companies

• Reserve charges for renewable wind resources would be significantly less which would save Platte River approximately $2.5 million in 2021

Managing Intermittent Generation in a Market

500 MW Load

Organized Market Balancing

500 MW Load

500 MW Resources

Resources• Supplied by Market

Organized Market Balancing

• More renewable generation can be integrated within an organized market

• Easier to manage imbalance

• Reduces costs

• Even without an organized market, we can manage a carbon footprint of 50 percent

• Resources will become more difficult to manage as we climb the renewable ladder

• Platte River will continue to be a leader and an innovator to find an organized market to help us integrate more renewables

Summary

Questions?


WAPA Hydropower Contracts

LAP and CRSP

WAPA Hydropower Contracts

• Loveland Area Project/Colorado River Storage Project

• Resources• Rates• Drought Impacts

Loveland Area ProjectLAP

LAP Resources

Loveland Area Project (LAP)Contract Rate of Delivery (CROD):

• Summer Season = 30 MW (April through September)

• Winter Season = 32 MW (October through March)

Rates:• Rates posted annually in September• Current: Demand Charge $4.12/kW-month and Energy Charge

$15.72/MWh• Rate terms are on an annual calendar year basis

• Current rate effective through December 31, 2018 and projected to remain the same through December 31, 2019

• Contract ends September 30, 2054

Drought-Adder:• Drought-Adder Rate Component to recover costs when necessary

• Drought-Adder paid off in FY2018 and is not a 2018 rate component

$-

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

$/MWh

LAP 10-Year Annual Blended Rate

LAP 10-Year Annual EnergyMWh

105.0

106.0

107.0

108.0

109.0

110.0

111.0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Thou

sand

s

Colorado River Storage Project

CRSP

UPPER BASIN

LOWER BASIN

CRSP Resources

Contract Rate of Delivery (CROD):• Summer season = 106 MW (April through September)• Winter season = 136 MW (October through March)

Sustainable Hydro Power (SHP):• How much customer is guaranteed to receive, regardless of water conditions• CRSP purchases energy to firm SHP

Rates:• Rates reviewed annually in May• Current: Demand Charge $5.18/kW-month and Energy Charge $12.19/MWh• If rate adjustment is necessary, it becomes effective the next term (Fiscal Year Oct.

1-Sep. 30)• Current rate in effect through September 2020• Contract ends September 30, 2057

Basin Fund:• Established under Section 5 of the Colorado River Storage Project Act in 1956• Fund is generally used for the repayment of operations and maintenance of the

transmission and generation portions of CRSP• Fund is also used to firm power during drought conditions• Approximately $120M in revenue is needed each year to fund Reclamation and

Western operation and maintenance needs; currently projected to end the fiscal year at $112M

• When Basin Funds drops below $120M, it can trigger a cost recovery charge, but we recently received notification that no charge will be assessed as a result of being below the $120M target

Colorado River Storage Project (CRSP)

CRSP 10-Year Average Hydro Capacity by Month

0

20

40

60

80

100

120

140

160

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

MW

Sustainable Hydro Power Available Hydro Power Unused Capacity

Unused capacity can be used as Customer Displacement Power (CDP) or Western Replacement Power (WRP)

$-

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

$/MWh

CRSP 10-Year Annual Blended Rate

0

100

200

300

400

500

600

700

800

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Thou

sand

s

MWh

CRSP 10-Year Annual Energy

Summary• Long term hydro contracts thru 2050• Rates are economical and stable• Allows operational flexibility to balance energy with load• Provides more than 600,000 MWh of our total annual

energy supply• Reliable source of energy representing almost 20

percent of our non-carbon portfolio delivered to owner municipalities

Questions?


April Operational Results

Variance Key: Favorable: >2% | Near budget: +/- 2% | Unfavorable: <-2%

Category April Variance YTD Variance

Municipal Demand (1.3%) (0.4%)

Municipal Energy (1.3%) (0.9%)

Baseload Generation (9.9%) (7.5%)

Wind Generation 3.9% (1.0%)

Solar Generation (8.7%) (5.0%)

Surplus Sales Volume (6.3%) (3.7%)

Surplus Sales Price (2.3%) (5.4%)

Dispatch Cost 2.6% (0.9%)


CategoryApril

Variance from Budget($ in millions)

Year to DateVariance from Budget

($ in millions)

Net Income $0.3 $1.9

Debt Coverage .10x .26x

Revenues ($0.2) ($0.9)

Operating Expenses $0.4 $3.1

Capital Additions $2.7 $8.5

Financial Summary

> 2% Favorable | 2% to -2% At or Near Budget | < -2% Unfavorable


Documents

Board of Directors Meeting...• Conduct siting study and establish transmission line route alternatives . Summer 2018: ... overall rate design . Summary ... coordination transactions