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Update on EPA Activities MOPC July 15-16, 2014. Current Known Impacts –Retirements –De-ratings –Outage Impact Studies Proposed Clean Power Plan 2 Topics.

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Presentation on theme: "Update on EPA Activities MOPC July 15-16, 2014. Current Known Impacts –Retirements –De-ratings –Outage Impact Studies Proposed Clean Power Plan 2 Topics."— Presentation transcript:

1 Update on EPA Activities MOPC July 15-16, 2014

2 Current Known Impacts –Retirements –De-ratings –Outage Impact Studies Proposed Clean Power Plan 2 Topics Covered

3 CURRENT KNOWN IMPACTS 3

4 Impact on Coal in SPP (based on recent survey)

5 5 Comparison with ITP 10 Assumptions

6 6 SPP bi-annual study process – Four-year look ahead for reliability issues – Weekly snapshots through the four years – Scheduled outages taken into account Current studies indicate there will be adequate time to perform generator retrofits necessary to comply with known environmental regulations – Retrofits are expected to impact generation supply economics more than the ability to reliably serve load 6 Outage Impact Study * * Formerly called “EPA Study”

7 7 67,678 Outage Impact Study Resource Adequacy Weekly Outages

8 8 Outage Impact Study Resource Adequacy Weekly Outages 67,678

9 PROPOSED CLEAN POWER PLAN 9

10 EPA’s proposed performance standards to reduce CO 2 emissions from existing fossil fuel-fired generators Promulgated under authority of Section 111(d) of the Clean Air Act Achieves nationwide 30% reduction of CO 2 from 2005 levels by 2030 Proposes state-specific emission rate-based CO 2 goals –Based on EPA’s interpretation and application of Best System of Emission Reduction (BSER) –Must be met by EPA Clean Power Plan Overview

11 States goals and flexibility –Interim goals applied that allows states to choose trajectory –Offers guidelines and allows states flexibility to develop and submit State Implementation Plans –States may adopt an equivalent mass-based goal States can develop individual plans or collaborate with other states If state does not submit a plan or its plan is not approved, EPA will establish a plan for that state 11 EPA Clean Power Plan Overview

12 12 Clean Power Plan Milestones June 2, 2014 Draft rule issued Oct 16, 2014 Comments due to EPA June 2015 Final rule expected June 2016 State Implentation Plans due June 2017 State plans due (with one-year extension) June 2018 Multi-state plans due (with two-year extension) January Interim goal in effect January 2030 Final goal in effect

13 13 BSER is Based on Four Building Blocks *Uses 2012 data for existing units and estimated data for units under construction.

14 14 SPP State Goals by 2030 *Includes Future States with IS Generation in SPP (N. Dakota, S. Dakota, Montana, and Wyoming) Fossil Unit CO2 Emission Rate Goals and Block Application (lbs/MWh) SPP State Average 2012 Rate = 1,699 SPP State Average 2030 Rate = 1,045

15 15 SPP State % Emission Reduction Goals *Includes Future States with IS Generation in SPP (N. Dakota, S. Dakota, Montana, and Wyoming) Total CO 2 Emission Reduction Goals (%) Average of SPP States = 38.5%

16 16 EPA Projected EGU Retirements (For SPP and Select Neighboring States) *Excludes committed retirements prior to 2016 **AEP provided data extracted from EPA IPM data

17 Arkansas –ADEQ has already had two stakeholder meetings, June 25 th & May 28 th –Next stakeholder meeting August 28 th –SPP Staff met with ADEQ to provide an SPP overview Missouri –Stakeholder meeting scheduled by MoPSC on August 18 th Nebraska –SPP Staff meeting with NDEQ and Nebraska utilities on July 30 th Oklahoma –Meeting being scheduled in August with stakeholders Texas –Public workshop scheduled by PUCT on August 15 th 17 SPP State Efforts Underway

18 Help educate and work with states Perform impact analyses –Inform stakeholder responses that are due October 16 –Inform current planning efforts –Assist state and member decision making Facilitate coordinated SPP response to proposed Clean Power Plan Evaluate and facilitate regional approach Coordinate with neighbors Other ways? 18 How Can SPP Assist?

19 Perform both reliability and economic analyses –Use 2024 ITPNT and ITP10 Future 2 models as base case –Develop two scenarios –Identify incremental reliability problems and increased APC Perform gas price sensitivity in economic analysis Perform load scaling sensitivity in reliability analysis Report results by October 1 19 SPP’s Proposed Impact Analysis Framework

20 20 Proposed Impact Analysis Scenarios Parameter Scenario 1Scenario 2 Coal50% retirement20% retirement NGCCs*Increase capacity factor to 70% Increase capacity factor to 50% WindAt least 50% capacity increase, assume additional state RPS At least 50% capacity increase Energy Efficiency1% of load3% of load Demand Response None Carbon TaxNone$30/ton *Will attempt to use existing capacity to replace coal up to existing capacity margin requirements


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