Economic Development from New Transmission and Generation in Wyoming

8/7/2019 Economic Development from New Transmission and Generation in Wyoming

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NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Economic Development from New Transmission

and Generation in WyomingAnalysis Performed by NREL for the Wyoming Infrastructure Authority

Eric Lantz, NREL

Suzanne Tegen, NREL

WIA Winter Board Meeting

Jackson, Wyoming

February 1, 2011


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National Renewable Energy Laboratory Innovation for Our Energy Future

Project context & review

Analysis definitions &caveats

Deployment scenario Modeling inputs

Results

Questions

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Presentation Overview


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Wyoming Wind Relative to California

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0

100,000

200,000

300,000

400,000

500,000

600,000

>30% Capacity Factor >35% Capacity Factor >40% Capacity Factor

AvailableWind

Capacity(MW)

WyomingCalifornia

In 2008, the U.S. DOE estimated roughly 300 GW would be necessary to supply 20% of U.S. electricityfrom wind by 2030; Wyoming has nearly 300 GW with capacity factors above 40% at 80 m


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Wyoming Natural Gas Wells

Source: USGS


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The Crux

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Source: NASA (http://www.nasa.gov/)


7/29National Renewable Energy Laboratory Innovation for Our Energy Future

Wyoming Transmission Projects

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Source: WIA



Role and Scope of the NREL Study

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Building and siting new power generation and infrastructure,

especially to serve out-of-state load, can be challenging.

Decisions are best made with a full understanding of how agiven project (or set of projects) will affect Wyoming and itscommunities.

Jobs and economic development are variables that areimportant to state policymakers, local policymakers, andresidents.

This study considers the question: What if?If deployment of new transmission allows for significant new powergeneration, what level of jobs and economic activity might result?



The JEDI Analysis Tools

Currently public

Utility-Scale Wind

Natural Gas

Coal

Geothermal

Ethanol Solar (CSP, PV)

In process

Transmission

Water Biopower

Offshore, smallwind

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Economic Development at Multiple Levels

2. Equipment production andsupply chain

1. On-site labor andprofessional services

3. Induced economic activity(household purchases due toinjection of income)

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Local Revenues, Equipment, & Supply Chain

Equipment manufacturing and sales -

Property taxes - Financing, banking, accounting

Steel mill jobs, parts, services - Blade and tower manufacturers

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JEDI Caveats

Results are an estimate, not a preciseforecast.

Results are not a measure of projectprofitability or viability.

Results report gross jobsas opposedto net jobs.

Assumptions around local sourcing andprocurement are fundamental indetermining local economic activity.

Sensitivity scenarios are included in this analysis.

Jobs are reported as Full-TimeEquivalent (FTE) jobs.

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Infrastructure Deployment (2012 2021)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

0

200

400600

800

1,000

1,200

1,400

1,600

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Ne

HVTrans

missionCapacity(

)

AnnualCap

acityInstalled(MW

)

Annual Wind Installations (MW)Annual Natural Gas Installations (MW)500 kV HVAC Line; 1,500 MW Capacity; ~ 310 miles (Right Axis)500 kV HVDC Line; 3,000 MW Capacity; ~ 225 miles (Right Axis)Collector System 230 kV Line; Variable Capacity & Length (Right Axis)

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Example Basic Inputs: Wind

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Installed Cost Annual O&M Cost Land Lease ($/MW)

(Annualized NPV)

Property Tax ($/MW)

(Annualized NPV)

$2,000/kW $25/kW $6,025 $6,080

0

200

400

600

800

1,000

1,200

1,400

1,600

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

InstalledWindPower(M

W)



Example Detailed Inputs: Wind

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Wind Construction ParametersPercentage of Total

Installed Cost

Wyoming Local Purchase Coefficient

Base Case High Case Low Case

Turbine nacelle & drive train 43% 0%Blades 10% 0%

Towers 11% 0% 50% 0%

Transportation 8% 0%

General site materials 10% 70%

Transformer 1% 0%

Electrical equipment 1% 20%

HV line extension 2% 10%

Foundation labor



Results

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Combined Base CaseEmployment Over Time

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

AnnualEmployment(FTE)

Construction Project Development and Onsite Labor Activity Construction Equipment and Supply Chain Activity

Construction Induced Activity Operations Onsite Labor Activity

Operations Local Revenue and Supply Chain Activity Operations Induced Activity

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Base CaseEmployment by Infrastructure Type

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

AnnualEmploym

ent(FTE)

Transmission

Natural Gas

Wind

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Base Casefor New Wind Over Time

23

0

1,000

2,000

3,000

4,000

5,000

6,000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

AnnualEmp

loyment(FTE)






Base Casefor New Natural Gas Generation

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0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2014 2015 2016 2017 2018 2019 2020 2021 2022

AnnualEm

ployment(FTE)






Transmission Employment Over Time

25

0

1,000

2,000

3,000

4,000

5,000

6,000

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

AnnualEmployment(FTE)

Project Development and Onsite Labor Activity Equipment and Supply Chain Activity

Induced Activity Onsite Labor Activity

Local Revenue and Supply Chain Activity Induced Activity


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The Potential Range of Results

Operations OnlyConstruction and Operations

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Employment(FTE)

High Case

Base Case

Low Case

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Direct Payments to Government & Landowners

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$0

$50

$100

$150

$200

$250

$300

$350

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

DirectPayments(Millions)

Sales tax - construction Sales tax - operations Property tax

Generation tax Landowner payments


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Conclusions

Estimates suggest 8,000 to 14,000 Wyoming workers will be employed as a result ofthese projects during peak construction activity; peak activity occurs in 2016 and2019.

35% - 50% of peak construction activity is directly in the construction sector.

Averaged over the duration of the construction period, 4,000 to 5,900 workers peryear are employed as a result of construction-related economic activity.

Wages and benefits average $200 million - $330 million per year during construction.

Ongoing operation of this infrastructure is estimated to employ 2,300 - 2,600Wyoming workers for at least 20 years.

Wages and benefits average $105 million - $118 million per year during operations.

Economic output peaks at $1.2 billion in 2016 and $1.4 billion in 2019 before settlingto about $380 million per year during operations-only years.

Total Wyoming economic activity from these investments is expected to be on theorder of $11.8 billion - $14.8 billion (construction plus 20 years of operations).

Approximately 30% of total available economic activity

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Eric Lantz

Research AnalystStrategic Energy Analysis Center

National Renewable Energy Laboratoryhttp://www.nrel.gov/analysis/

http://www.windpoweringamerica.gov/

1617 Cole Blvd.

Golden, CO 80401-3393P: (303) 384-7418

E-mail: [email protected]

Questions

NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Thanks to the Wyoming Infrastructure Authorityand the U.S. DOE Technical AssistanceProgramfor funding this work. Thanks also to the U.S. DOE Wind Powering America

Initiative for ongoing support of the JEDI Analysis Tools

Documents

Economic Development from New Transmission and Generation in Wyoming