new mexico’s path to a sustainable energy future
Post on 30-Dec-2015
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• Environmental & Economic Challenges of the Status Quo
• Energy Efficiency• Renewable Energy Technologies• Policy Tools
OVERPECK QUOTE
"The western United States, in particular the southwestern United States from Southern California to Texas, will probably be one of the hardest-hit and soonest-hit parts of the United States”
Jonathan Overpeck, Univ. of Arizona Scientist and a lead author of the Intergovernmental Panel on Climate Change report, as quoted in the Albuquerque Journal, February 3, 2007.
New Mexico Confronts Supply Challenges: Energy Efficiency
Pub Svc N.M. - Energy Efficiency Savingsas a % of Total Retail Sales
0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Pub Svc Co. NM - EE Savings
8,0008,5009,0009,500
10,00010,50011,00011,50012,00012,500
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
An
n. G
WH
s
2% load growth
Cost recovery for DSM
• Removing barriers to utility “investment” in DSM
• 2007: NMPRC Rejects PNM gas decoupling proposal as too broad
• 2008: EUE Act Amendments
• 2009: PRC Incentive Docket – Marks proposes electric decoupling
New Mexico Confronts Supply Challenges: Natural Gas/Renewables
Delta-Person – PPA 132 MW CT 2000
Afton – RB 235 MW CC Nov 2007
Valencia – PPA 148 MW CT Summer 2008
Lea Power Prtnrs – PPA
500 MW CC July 2008
Newman Five 288 MW CC May ’09 (CT)
May ’10 (CC)
Lordsburg
Luna
80 MW CT
190 MW CC
RB pending
EPE/eSolar PPA 64 MW Solar Thermal
2011
Wind Energy – Prime Mover in R.E.
• Approx 17,000 MW installed capacity (2008)• 5000 MW added in 2007• Utility ownership has begun
• Cost $23 - $60/mwh after PTC• PTC = $18/mwh• Prices increasing due to materials, demand, Exchange Rate
Annual Report on U.S. Wind Power Installation, Cost, and Performance Trends: 2007. Wiser, R., and M. Bolinger. May 2008
Wind projects in NM or serving NM
Project Utility*Date
Online MWClovis Xcel 1999 0.66N.M. Wind Energy CtrPNM 2003 204White Deer - TX Xcel 2004 80Caprock Xcel 2004 60Caprock II Xcel 2005 20San Jon Xcel 2005 120Wildorado - TX Xcel 2007 160Aragonne Mesa APS 2007 90
*All projects are via PPAs.
Wind with Gas Backup: Good for Utilities, Good for Ratepayers.
Model of Revenue StreamsGas CC Alone vs. Wind w/ Gas Bkup
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
Gas Only Wind/Gas Gas Only Wind/Gas
To
tal C
os
t to
Ra
tes
Depreciation
ROE (Profit)
Interest
Fuel Cost
200 MW Gas CC, 70% Cap, $7 gas + 4%/yr
200 MW Wind, 32% Cap. + Gas Backup
2010 (year 1) 2015 (year 5)
Wind with Gas Backup – Capacity + Reduced exposure to Gas Pricing Pressure
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180Y
ear
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
2031
2033
2035
2037
Co
st p
er M
wH
GasWind+Gas
Potential Multi-stateTransmission Projects
ARIZONA
EnergyResource
Zones
Tucson
Phoenix
HolcombNEW MEXICO
COLORADO
WYOMING
DaveJohnston
LRS
Albuquerque
Limon
ComancheLamar
Pawnee/Story
Socorro
Gladstone
Midway
SunZia
HIGH PLAINS EXPRESS
15
Solar Technologies
Concentrated Solar Power (CSP)
• 10-15¢/kwh for 100MW+ projects• Thermal Storage/Backup Possible• Kramer Junction (1980s) 350 MW,
Nevada Solar One (2007) 64 MW, Spain
Photovoltaic (PV) Panels: •1 – 3 kw home systems common (~$18,000 installed home system = 25¢/kwh)
• Commercial (10 – 100 kw)
• Major projects - TriState/FirstSolar 30MW Colfax County
• El Paso Electric – 64 MW solar thermal PPA w/ eSolar. Approved by PRC
• PNM-led consortium - ~100 MW solar thermal trough plant. Bids currently being evaluated. Possible load-side (Abq) site.
• TriState/FirstSolar 30 MW PV in Colfax Cty
Potential Utility Scale Solar Projects in New Mexico
• Dairy & Feedlot Waste
•Wood Waste
•Landfill Gas
Geothermal Plant in Valles Caldera
Biomass & Geothermal
State Renewable Portfolio Standards
State Goal
☼ PA: 18%¹ by 2020
☼ NJ: 22.5% by 2021
CT: 23% by 2020
MA: 4% by 2009 + 1% annual increase
WI: requirement varies by utility; 10% by 2015 goal
IA: 105 MW
MN: 25% by 2025(Xcel: 30% by 2020)
TX: 5,880 MW by 2015
☼ AZ: 15% by 2025
CA: 20% by 2010
☼ *NV: 20% by 2015
ME: 30% by 200010% by 2017 - new RE
State RPSHI: 20% by 2020
RI: 16% by 2020
☼ CO: 20% by 2020 (IOUs)
*10% by 2020 (co-ops & large munis)
☼ DC: 11% by 2022
☼ NY: 24% by 2013
MT: 15% by 2015
IL: 25% by 2025
VT: RE meets load growth by 2012
Solar water heating eligible
*WA: 15% by 2020
☼ MD: 9.5% in 2022
☼ NH: 23.8% in 2025
OR: 25% by 2025 (large utilities)5% - 10% by 2025 (smaller utilities)
*VA: 12% by 2022
MO: 11% by 2020
☼ *DE: 20% by 2019
☼ NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops)
☼ NC: 12.5% by 2021 (IOUs)10% by 2018 (co-ops & munis)
ND: 10% by 2015
Source: dsireusa.org/Sept 2007
New Mexico Renewable Energy Act: NMSA § 62-16-1A Renewable Portfolio Standard (RPS) Law
• R.E.: solar, wind, biomass, geothermal• Scope: IOUs, Co-ops (lower reqmts) • RPS 5% of retail sales in 2006
10% of retail sales in 201115% in 2015, 20% in 2020
• Reasonable Cost Thresholds• Annual Procurement Plans• PRC’s Diversity Rules – 20% Solar Target
NM: Aggressive Targets / Small State
2007 2011 2015 2020
RPS 6% 10% 15% 20%Total IOU MWh 15,000,000 15,900,000 17,000,000 18,300,000
R.E. MWh Req'd 898,000 1,586,000 2,557,000 3,665,000
Solar Target 2% 3% 4%Solar MWh 317,000 511,000 733,000Solar Need 100 170 240
Biomass Need 40 70 100
Wind as Fill-In 6% 9% 12%Wind Mwh 898,000 951,000 1,534,000 2,199,000Wind Need 320 340 550 780
Net Metering
NMPRC Orders:
PNM Incentive Program: 13¢/kwh for resid RECs 15¢/kwh for comm’l RECs
SPS/EPE Incentive Pgms
NMPRC Rule: Utilities must interconnect customer-owned generation via net-metering up to 80 MW
PV Incentive Programs
Utility Program
Incentive payment per kwh
Duration of
payments
PNM Residential (<=10kw) $0.13 12 yearsCommercial (10kw - 1 MW $0.15 20 years
EPE Residential (<10kw) $0.13 12 years
SPS Small (<=10 kw) $0.20 14 yearsMedium (10 kw - 100 kw) $0.20 10 yearsLarge (100kw - 2MW)
Small Biomass (10 – 50kw) $0.08 14 years
Med Biomass (50kw – 1MW) $0.08 10 years
By bid
New Mexico R.E. Tax Incentives
• Renewable Energy Production Tax Credit – Reduces consumer cost by 1¢ to 4¢ per kwh
– One of the best in nation.
• Advanced Energy Tax Credit – “Clean coal” bill, also applies to solar!
– 6% of eligible plant costs
• Other Tax Credits– Homeowner Solar Tax Credit – 30%, $9,000– Gross Receipts (Sales) Tax exemptions– Bio-diesel PTC
Integrated Resource Planning (IRP)
• All utilities required to submit
• Public process required
• PNM IRP prioritizes energy efficiency
Next Steps: PRC Regulatory Dockets
• Spring ’09: Net-Metered/Customer Owned Systems– Annual True-Up rulemaking– Permissibility of Third-Party Ownership
• Fall ’09: Submission/Review of 2010 Renewable Procurement Plans
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