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Drivers Of The New Transmission System 031910

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ronmiller74

The document discusses the drivers for new transmission systems to transport renewable energy in the United States. It notes that renewable resources tend to be located far from areas of high energy demand and coal consumption. It argues that a national transmission system is needed to connect renewable energy sources to major population centers in a cost-effective way. Such a system would allow renewable resources across large regions like the Great Plains to be harvested and their variability dampened. It asserts that intermediate states must also benefit from such transmission infrastructure for large multi-state projects to be viable.

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Drivers of the New Transmission System CLE International Ritz Carlton, Denver March 19, 2010 by: Ron Miller, P.E.
RE Project Ingredients Environmentally-permittable Technically-feasible Financially-viable and the linchpin of any utility-scale project is TRANSMISSION of energy to the end- user market Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 2
Market Drivers U.S. electricity demand, coal consumption, & electricity prices Renewable resource location Federal direction State renewable portfolio standards Price convergence Transmission use and constraints Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 3
U.S. Electricity Demand, Coal Consumption, & Electricity Prices Key electricity consuming areas: Texas, California, Midwest Key coal consuming areas for electricity: Texas, Midwest, Southeast Highest prices for electricity: Northeast, California, Texas These key criteria define the target market for future renewable energy destinations Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 4
Electricity Consumption High energy demand areas Source: National Priorities Project Database Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 5
Coal Consumption High coal, NOX, SOX, CO2 Source: National Priorities Project Database Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 6
Average 2008 Residential Electricity Price in U.S. High energy price areas Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 7
U.S. Residential Electricity Price Historical Trend Growing energy use/price, even with DSM/energy efficiency Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 8
Renewable Resource Location Wind in Intermountain / Great Plains area, California Solar in desert Southwest Geothermal in Nevada, California Best resources tend to be in more remote locations, not near major population centers, areas of highest coal use, or areas with highest electricity prices Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 9
U.S. Wind Resources Source: NREL Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 10
U.S. Wind Potential Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 11
U.S. Solar Resources Source: NREL Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 12
U.S. Geothermal Resources Source: NREL Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 13
Federal Direction Ensure that 10 percent of the nation's electricity comes from renewable sources by 2012 and 25 percent by 2025 Implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050 Reduced GHG in tandem with retiring coal plants opens a window for alternative sources for energy mix, if it can be delivered to the end-user market Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 14
Renewable Portfolio Standards Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 15
Price Convergence Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 16
Grid Use Grid built to handle transmission & distribution needs for a utilitys service territory with ties to only adjoining utilities Never intended to handle cross-country transmission of energy Transmission investment and rate of return have historically lagged generation Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 17
Current U.S. Grid Source: Global Energy Decisions, LLC, June, 2008 Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 18
National Extra High-Voltage Overlay Proposal Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 19
Transmission Issues According to North American Reliability Council new generation supplies are forecast to outpace transmission, constraining wind development with a planned 145,000 megawatts of capacity over the next 10 years Generation growth over 10 years: 21% Transmission line growth over 10 years: 10% with 1,700 circuit miles Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 20
Transmission Solutions Texas approved a $4.9 billion transmission system upgrade moving power from West Texas to major population centers. Capable of transmitting 18,500 MW of wind power. Cost: $4/month/retail customer National upsurge in transmission investment due to Congressional action to increase transmission project allowed rate of return Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 21
Our Problem High energy demand & prices Renewable resources Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 22
One Possible Future Solution High voltage transmission High energy demand & prices Renewable resources Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 23
Value North / South grid allows leveraging natural variability of wind throughout Great Plains and complementary solar, just as a portfolio of different stocks lowers overall volatility East / West grid allows delivery to the target markets with greatest value to producers and producing states Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 24
Kinder Morgan Rockies Express Natural gas pipeline from Cheyenne, WY to Clarington, OH Limited off-ramp to deliver gas to ultimate destination, connecting market with discounted gas prices (CO) to one with premium prices (East Coast) Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 25
Kinder Morgan Northeast Express Natural gas pipeline Clarington, OH to Linden, NJ Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 26
Summary Environmental concerns are leading generation source changes Renewable resources need connections to end-user electric markets which offer higher prices to spur renewable growth Price convergence will multiply the need for transmission to accommodate renewable energy generation Energy storage will dampen RE variability, adding greater reliability and value to its generation Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 27
Summary, contd. Choice between less-productive, local renewable resources vs. highly-productive resources connected to high-demand, high-priced markets Currently, intermediate states can derail renewable generation and its multi-state transmission to demand centers Need to incent the intermediate states to gain from transmission, not just producer and end user Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 28
Summary, contd. To harvest best resources with economies of scale, national extra-high voltage transmission system similar to interstate highway & natural gas pipeline system is needed Combine different RE technologies whose energy production profiles are complementary to improve transmission asset utilization and project rate of return Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 29
Contact Information Ron Miller, P.E. 303-723-5465 303-748-3441 cell ronmiller74@comcast.net Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 30
Questions and Answers Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 31

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Drivers Of The New Transmission System 031910

  • 1. Drivers of the New Transmission System CLE International Ritz Carlton, Denver March 19, 2010 by: Ron Miller, P.E.
  • 2. RE Project Ingredients Environmentally-permittable Technically-feasible Financially-viable and the linchpin of any utility-scale project is TRANSMISSION of energy to the end- user market Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 2
  • 3. Market Drivers U.S. electricity demand, coal consumption, & electricity prices Renewable resource location Federal direction State renewable portfolio standards Price convergence Transmission use and constraints Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 3
  • 4. U.S. Electricity Demand, Coal Consumption, & Electricity Prices Key electricity consuming areas: Texas, California, Midwest Key coal consuming areas for electricity: Texas, Midwest, Southeast Highest prices for electricity: Northeast, California, Texas These key criteria define the target market for future renewable energy destinations Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 4
  • 5. Electricity Consumption High energy demand areas Source: National Priorities Project Database Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 5
  • 6. Coal Consumption High coal, NOX, SOX, CO2 Source: National Priorities Project Database Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 6
  • 7. Average 2008 Residential Electricity Price in U.S. High energy price areas Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 7
  • 8. U.S. Residential Electricity Price Historical Trend Growing energy use/price, even with DSM/energy efficiency Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 8
  • 9. Renewable Resource Location Wind in Intermountain / Great Plains area, California Solar in desert Southwest Geothermal in Nevada, California Best resources tend to be in more remote locations, not near major population centers, areas of highest coal use, or areas with highest electricity prices Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 9
  • 10. U.S. Wind Resources Source: NREL Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 10
  • 11. U.S. Wind Potential Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 11
  • 12. U.S. Solar Resources Source: NREL Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 12
  • 13. U.S. Geothermal Resources Source: NREL Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 13
  • 14. Federal Direction Ensure that 10 percent of the nation's electricity comes from renewable sources by 2012 and 25 percent by 2025 Implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050 Reduced GHG in tandem with retiring coal plants opens a window for alternative sources for energy mix, if it can be delivered to the end-user market Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 14
  • 15. Renewable Portfolio Standards Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 15
  • 16. Price Convergence Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 16
  • 17. Grid Use Grid built to handle transmission & distribution needs for a utilitys service territory with ties to only adjoining utilities Never intended to handle cross-country transmission of energy Transmission investment and rate of return have historically lagged generation Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 17
  • 18. Current U.S. Grid Source: Global Energy Decisions, LLC, June, 2008 Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 18
  • 19. National Extra High-Voltage Overlay Proposal Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 19
  • 20. Transmission Issues According to North American Reliability Council new generation supplies are forecast to outpace transmission, constraining wind development with a planned 145,000 megawatts of capacity over the next 10 years Generation growth over 10 years: 21% Transmission line growth over 10 years: 10% with 1,700 circuit miles Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 20
  • 21. Transmission Solutions Texas approved a $4.9 billion transmission system upgrade moving power from West Texas to major population centers. Capable of transmitting 18,500 MW of wind power. Cost: $4/month/retail customer National upsurge in transmission investment due to Congressional action to increase transmission project allowed rate of return Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 21
  • 22. Our Problem High energy demand & prices Renewable resources Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 22
  • 23. One Possible Future Solution High voltage transmission High energy demand & prices Renewable resources Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 23
  • 24. Value North / South grid allows leveraging natural variability of wind throughout Great Plains and complementary solar, just as a portfolio of different stocks lowers overall volatility East / West grid allows delivery to the target markets with greatest value to producers and producing states Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 24
  • 25. Kinder Morgan Rockies Express Natural gas pipeline from Cheyenne, WY to Clarington, OH Limited off-ramp to deliver gas to ultimate destination, connecting market with discounted gas prices (CO) to one with premium prices (East Coast) Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 25
  • 26. Kinder Morgan Northeast Express Natural gas pipeline Clarington, OH to Linden, NJ Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 26
  • 27. Summary Environmental concerns are leading generation source changes Renewable resources need connections to end-user electric markets which offer higher prices to spur renewable growth Price convergence will multiply the need for transmission to accommodate renewable energy generation Energy storage will dampen RE variability, adding greater reliability and value to its generation Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 27
  • 28. Summary, contd. Choice between less-productive, local renewable resources vs. highly-productive resources connected to high-demand, high-priced markets Currently, intermediate states can derail renewable generation and its multi-state transmission to demand centers Need to incent the intermediate states to gain from transmission, not just producer and end user Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 28
  • 29. Summary, contd. To harvest best resources with economies of scale, national extra-high voltage transmission system similar to interstate highway & natural gas pipeline system is needed Combine different RE technologies whose energy production profiles are complementary to improve transmission asset utilization and project rate of return Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 29
  • 30. Contact Information Ron Miller, P.E. 303-723-5465 303-748-3441 cell ronmiller74@comcast.net Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 30
  • 31. Questions and Answers Copyright息 2010 Ronald L. Miller. Material can be shared or copied with attribution to the copyright holder. http://www.linkedin.com/pub/ron-miller-p-e/4/842/580 31
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