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NECPUC SYMPOSIUM Concurrent B Natural Gas Conditions Facing New England Mark R. Babula ISO New England Inc. Supervisor - Power Supply & Reliability June.

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Presentation on theme: "NECPUC SYMPOSIUM Concurrent B Natural Gas Conditions Facing New England Mark R. Babula ISO New England Inc. Supervisor - Power Supply & Reliability June."— Presentation transcript:

1 NECPUC SYMPOSIUM Concurrent B Natural Gas Conditions Facing New England Mark R. Babula ISO New England Inc. Supervisor - Power Supply & Reliability June 17, 2002

2 ISO New England Inc.2 Changing Landscapes In the very near future, the majority of New Englands electric generating fleet will be fueled by a single fuel source - natural gas January ISO-NE publishes its Phase I Gas Study Significant feedback from natural gas sector initiates a need to look further at gas infrastructure proposals February ISO-NE publishes its Phase II Gas Study

3 June 17, 2002ISO New England Inc.3 What the ISO Gas Studies Were An assessment of New Englands existing and future natural gas pipeline infrastructure (deliverability) An assessment of electric and gas-side contingencies that may impact the operation of merchant generation Additional assessments of: –Pipeline operations under restricted conditions –Distrigas LNG –System restoration of electric power grid

4 June 17, 2002ISO New England Inc.4 What the ISO Gas Studies Were Not Not an assessment of natural gas supply & storage Not an assessment of natural gas commodity or transportation prices Not an assessment of natural gas prices on New Englands Electric Energy Clearing Prices (ECPs) Not an assessment of LDC operations/contracting issues Not an assessment of electric system resource adequacy or a fuel mix study

5 June 17, 2002ISO New England Inc.5 ISO-NE Gas Study Findings Gas-fired generation in New England will soar from 16% in 1999 to over 50% by 2004 (high % w/attrition) Insufficient gas pipeline delivery capacity to satisfy the winter peak day coincident demand from both LDCs and the electric power generation sector LDCs will always be served first due to contracting of primary firm transportation rights Deliveries to the electric generation sector is subordinated due to contracting of secondary non-firm transportation rights

6 June 17, 2002ISO New England Inc.6 ISO-NE Gas Study Findings One mans delivery shortfall is another mans fuel procurement strategy: the so-called generation-at-risk –Winter 2002/03 peak day = 3,100 MW (Reference Case) –Winter 2002/03 peak day = 3,950 MW (High Case) New England has no summer season gas deliverability issues (except for maintenance?) Improved supplies from Maritime Canada will help pipeline companies respond to gas-side contingencies

7 June 17, 2002ISO New England Inc.7 ISO-NE Gas Studies Findings Increased vaporization capability at Distrigas LNG is targeted for the new Sithe New Mystic plant - Distrigas availability becomes vital until the Boston/NEMA transmission upgrades materialize Additional fuel oil volumes of up to 25% of the regions daily delivery capabilities would be required to meet merchant generators backup fuel requirements in the winter (sustainability issues)

8 June 17, 2002ISO New England Inc.8 ISO-NE Gas Study - System Restoration NEPOOL System Restoration Working Group Question: What is the impact on New Englands natural gas infrastructure upon partial or full collapse of the bulk electric power grid? Assess impacts on gas-side operations (similar to Y2K) –Compressor stations: gas-fired versus electrical drives –Battery backup capabilities on critical equipment & sustainability issues –Revised system restoration procedures/plan and address black start capability issues

9 June 17, 2002ISO New England Inc.9 ISO-NE Gas Study Recommendations ISO-NE Should: –Identify merchant fuel transportation contracts –Safeguard choices for designation of operating reserves –Know which generators have on-site compression –Understand back-up fuel capabilities and investigate ability to switch on the fly –Gain access to the gas pipelines electronic bulletin boards for real-time operational data on gas system dynamics

10 June 17, 2002ISO New England Inc.10 Expanding Horizons - New York Gas Study Spring NYSERDA & NYISO joint venture project to evaluate the operation and interaction of gas & electric systems in New York state - 4 Study Objectives –Objective 1: Better understanding of the potential use of gas for power generation and the pipelines ability to deliver –Objective 2: Develop a model of pipelines serving Northeast & NY to determine lower/upper bounds of gas delivery capability –Objective 3: Examine the operation of the gas & electric systems under various contingencies –Objective 4: Technology transfer

11 June 17, 2002ISO New England Inc.11 Expanding Horizons - New York Gas Study NY Gas Study Technical Evaluation Panel Members: –Empire State Development –The Energy Association of New York State –New York Gas Group –NY Independent System Operator –NY State Dept of: Environmental Conservation, Public Service, Transportation & NYSERDA Chosen Vendor = Charles River Associates Project completion date - Fall 2002

12 June 17, 2002ISO New England Inc.12 Expanding Horizons - Multi-Regional Gas Study Multi-Regional Northeast Gas Study: –Encompassing the control areas of NE, NY, PJM & IMO –Steering Committee: ISO-NE, NYISO, PJM, IMO, NERC/NPCC –IMO = Project Manager –RFP issued in Spring 2002 –Vendor evaluation/selection by Steering Committee –Phase I - steady-state modeling of 4 regions –Phase II - multi-area contingency analysis & deliverables Project completion date - Summer 2003

13 June 17, 2002ISO New England Inc.13 Back to Home - Lets Address the Issues New England Gas Associations Advisory Committee on Power Generation –A new liaison to the electric sector –Committee membership represents companies providing the upstream transportation for nearly 100% of the natural gas consumed within New England ISO-NE is working with the NEGA ADCOM to attain: –Greater mutual education and understanding of both the electric and gas industries –Increased communications –Reliable and efficient operation of the regional energy system

14 June 17, 2002ISO New England Inc.14


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