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Pasadena Water and Power
IRP Balanced Key Objectives
RiskRisk
EnvironmentEnvironment CostCost
GHG Emissions Reductions
Renewable Energy Procurement
Competitive Rates
Reliability
Focus on Cost
Focus on Risk
Focus on Environment
Compromise onTradeoffs
Cost Minimization
Rate Stability
Regulatory Uncertainty
Balanced Objectives
Pasadena Water and Power
2009 IRP Progress ReportSummary Table – Part I
RecommendationsTarget
QuantityTarget Date
Status
Coal Power Displacement 35 MW 2016 Negotiations in process
Local Gas-Fired Generation: Replace Broadway Unit 3 with a similarly-sized CC Upgrade controls and equipment on GT-1 and GT-2
65 MW (approx.) 2014
Timely decisions will keep project on track
Scope of work may be expanded due to GT-1 failure
Energy Efficiency: Cumulative annual energy savings from Fiscal Year 2007
45.5 GWh/yr 124.0 GWh/yr 211.5 GWh/yr
- FY10- FY15- FY20
On trackCumulative savings estimated
at 53 GWh/yr as of FY2010
Peak Load Savings: Reduce peak load by 10% below expected levels
33 MW 2012 Unlikely 11 MW (3.4%) as of FY2010
Demand Response: Incentives to reduce or curtail electric use during peak load
5 MW 2012Delayed.
To be developed in conjunction with smart grid
Pasadena Water and Power
2009 IRP Progress ReportSummary Table – Part II
RecommendationsTarget
QuantityTarget Date
Status
Renewable Portfolio Standard (energy used for PWP’s retail electric customers)
15% (187 GWh)33% (381 GWh)40% (460 GWh)
201020152020
On Track 8% for CY 2009
15% for CY 201017% for CY 2011
Solar photovoltaic installations in Pasadena (SB-1 goal is 14 MW by 2017)
3 MW10 MW15 MW19 MW
2010201520202024
On track1 MW Completed4.6 MW Pending
Feed-In Tariff for Local Renewable Resources
8 MW10 MW
20202023 In development
GHG Emissions Reductions (base year 2008 emissions = 905,000 tonne)
5% (45,250 tonne)25% (226,250 tonne)40% (362,000 tonne)
201020152020
On Track 5% reduction in CY 2010
Pasadena Water and Power
Gas Turbine 1 (GT-1)
GT-1 Fire on May 4, 2010 Initial Repair Estimate = $8,017,552 Repair Has Been Ruled Out - Lack of
Parts Insurance Company:
> Authorized replacement study…expected by August 25th
> Offered partial payment = $6,314,041> Whole loss and damage …to be determined
(Replacement cost and lost revenues)
Pasadena Water and Power
Estimated Portfolio MixFor Retail Sales – Calendar Year 2010
4%6%
15%
2%
15%
58%
Coal
Natural Gas
Market Purchases
Renewables
Nuclear
Large Hydro
25% GHG-Free
Pasadena Water and Power
Rate Impacts
Rate Component
Approx. Avg. Rate
Rate Pressures
PBC 0.58¢ Solar and Energy Efficiency Programs
Energy 8.53¢
Renewable Resource Acquisition Feed-in Tariff Fuel and Spot Market Energy Costs
GHG Mitigation, Credits/Tax
Transmission 0.82¢ CAISO Transmission Rate
Distribution 4.28¢ Infrastructure Replacement Smart Grid
Total 14.21¢
Pasadena Water and Power
Monthly Residential BillAs of June 2010
SCE has tiered rates Pasadena has flat rates with no subsidies between
rate classes
An
ahei
m
An
ahei
m
LA
DW
P
LA
DW
P
Bu
rban
k
Bu
rban
k
Gle
nd
ale
Gle
nd
ale
Pas
aden
a
Pas
aden
a
SC
E
SC
E
$0
$25
$50
$75
$100
$125
$150
$175
500 kWh 1,000 kWh
Pasadena Water and Power
Rate Challenges
Evolving Legislative and Regulatory Mandates > Federal and State climate initiatives, EPA, CEC, CARB
Shortage of Renewable Energy… Higher prices Operational Constraints … transmission Compounded Rate Impact
> Buy high price renewable power > Sell excess existing energy at discount
Future Staff Requests for MSC/Council Approval> Resolution authorizing PWP GM to trade RECs and
other environmental attributes> Renewable energy contracts
Pasadena Water and Power
IRP RPS Goals vs. Proposed Regulatory Requirements
15%
33%
40%
24%
28%33%
25%
20%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Calendar Year
Perc
ent o
f Sal
es
PWP RPS GoalCARB RPS ProposalSB 722 Proposal
Pasadena Water and Power
Project Resource Calendar Year 2010 Calendar Year 2011
Type MWh % of Load MWh % of Load
Long-Term Contracts
Azusa Hydro Small Hydro 0 0.0% 0 0.0%
Solano High Winds Wind 16,176 1.3% 16,176 1.3%
Covina/Tulare Landfill Landfill Gas 66,047 5.3% 75,729 6.3%
Ormat-Heber South Geothermal 18,353 1.5% 17,476 1.4%
Chiquita Landfill Landfill Gas 14,054 1.1% 55,757 4.6%
Milford Wind I (Utah) Wind 8,916 0.7% 11,826 1.0%
Subtotal Long-Term 123,546 10.0% 176,964 14.6%
Short-Term Contracts
Glendale Landfill Gas Landfill Gas 35,040 2.8% 35,040 2.9%
Iberdrola Renewables Wind 31,060 2.5% - 0.0%
Subtotal Short-Term 66,100 5.3% 35,040 2.9%
Total Renewables 189,646 15.3% 212,004 17.6%
Expected Renewable Energy Resources
Pasadena Water and Power
Pasadena Solar InitiativeProgress Towards 14 MW Goal
0.8
0.5
4.6
0.6
4.0
8.6
3.5
5.2.4
115
207
39
179
208
47
514
351
95
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
SDG&E
PG&E
SCE
PWP Total
PWP Residential
PWP Non-Res
Installed Pending Remaining
Pasadena Water and Power
Energy Efficiency Progress
Cumulative Energy Efficiency (% of Load)
0%
1%
2%
3%
4%
5%
2007 2008 2009 2010 2011Fiscal Year
Actual
Goal
Pasadena Water and Power
Market and Regulatory Update
Rising renewable energy cost Softened natural gas prices (near to short term) Reduced electricity demand (near to short term) Inadequate supply of deliverable renewable
energy Wind/Solar deliverability
> CAISO restrictions on import of intermittent resources
Regulatory uncertainty:> RECs for RES/RPS compliance? CARB…no limits;
SB722…10%?> Proposition 23 / Next Governor?> GHG emission calculation methodology? > Cap and Trade program?> Federal regulations… pre-emption?
Pasadena Water and Power
PWP Power Content Label
ENERGY RESOURCES
2005PWP
2006PWP
2007PWP
2008PWP
2009PWP
2008 CA Pwr Mix
(actual) (actual) (actual) (actual) (actual) (for comparison)
Eligible Renewable 2% 2% 8% 8% 8% 5%
-- Biomass & waste 0% <1% 5% 6% 5% <1%
-- Geothermal 0% 1% 1% 1% 1% 4%
-- Small hydroelectric 0% <1% 0% 1% 0% <1%
-- Solar 0% <1% 0% 0% 0% <1%
-- Wind 1% 1% 1% 1% 1% <1%
Coal 70% 67% 65% 60% 60% 29%
Large Hydroelectric 7% 10% 7% 6% 6% 31%
Natural Gas 15% 16% 15% 20% 20% 35%
Nuclear 6% 5% 5% 6% 6% <1%
Other 0% 0% 0% 0% 0% 0%
TOTAL 100% 100% 100% 100% 100% 100%
Purchased From Specific Resources
84% 78% 89% 91% 92% --
Pasadena Water and Power
Renewable Energy Contract Status
Milford Phase I, UT - wind (5 MW)> Delivery started late April 2010
Ameresco Chiquita Canyon, CA - landfill gas (6.67 MW)> Delivery expected from 10/2010
Ameresco Skunk Creek, AZ - landfill gas (4 MW)> Developer not proceeding due to cost escalation
IID, CA - MOU for exploration of geothermal energy (~6 MW) > On hold due to differences in major participant
Milford Phase II, UT - wind (10 MW)> Withdrawn due to:
» CAISO prohibition on wind/solar imports » Uncertainty of alternative transmission» Prepayment contractual obligation for future
power
Pasadena Water and Power
PWP Initiatives
Renewable Energy Contracts Under Negotiation > Geothermal…….. 5-10 MW> Solar/Wind……… 20 MW> Landfill to energy…8 MW> Bio gas ………… 6 - 8 MW
Transmission > Enhanced Import/Export right at TM Goodrich..336
MW> Southern Transmission System upgrade by 26 MW
Outreach:> RFPs issued by PWP and SCPPA
Pasadena Water and Power
Strategies to Meet IRP Goals
Procure Renewable Resources That:> Are cost effective> Can deliver energy to Pasadena> Preferably located in California
Procure RECs to Meet Regulatory RPS Short Falls Proactive Legislative / Regulatory Involvement Keep MSC and the City Council Informed
Future Staff Requests for MSC/ City Council Approval> Resolution authorizing PWP GM to trade RECs and
other environmental attributes.> Renewable energy contracts