Northwest Coal Retirement Reduction Study Development of Base Case Assumptions and Scenarios PNUCC Meeting October 15,

Todays Outline 2 Base Assumptions Review Backcast Status Backcast Clean up Items Review Backcast Results Forecast Status

Study Basic Assumptions 3 Assume resources retirement in Northwest  Base Case: Centralia (1,340 MW)  Scenario 1: Plus Colstrip 1&2 (614 MW)  Scenario 2: Scenario MW of Wind in Montana Replacement capacity:  Generic Combine Cycle (CC): F-Frame CC consisting of 330 MW of CC and 50 MW of duct fired burner (DB)  Boardman is replaced by an additional G-Frame CC in the Boardman area

Years to Run 4 Backcast Comparison Coal StudyNotes 2010YesNo 2014YesNo 2017Yes 2017 w/Coal Retirement NoYesIncludes Coal retirement, CA Once Through Cooling, and announced re-powers Backcast: Consistent transmission and generation outages in all three years (2010, 2014 & 2017) Coal Study: Generic seasonal generation outages

Status of Backcast 5 Completed:  Created major maintenance patterns for 2010 based on CEMS data  Date shifted 2010 maintenance into 2014 and 2017  Used WECC maintenance for Nuclear units plus maintenance at minor units  Have cleaned up some path definition issue  Will check additional paths as needed  Fuel cost for 2010, 2014, and 2017  Review of existing and under constructed supply

Status of Backcast 6 To Do:  Clean up congestion issues  Currently Boundary is backing off 236 GWh in Jun and placing that generation in July and August  Check for LMP issues at generators  Clean up/investigate path flow on:  Path 4 & 5: West of Cascades – North and South  Path 6: West of Hatwai  Pull CA imports for 2014 to compare to 2014 run  Apply bidding to backcast supply

List Of Top Congestion Interfaces 7 Check for modeling issues related to congestion on interfaces, branches and generator interconnections

Path 8 Montana to Northwest Flow 8

Path 6 Hatwai 9

Path 5 West of Cascades – North&South 10

Path 66 & 65 Flow (COI + PDCI) 11

Path 66 COI Flow 12 COI is showing $32M of congestion (on page 7)

Path 65 PDCI Flow 13

CA Import: COI + PDCI + WOR 14

Forecast To Do List 15 Select location for replacement capacity  Centralia, North of Seattle Area and Stanfield (McNary to Boardman) Check retirement and replacement capacity:  ST-Coal  California OTC Create maintenance outage Create load files Create fuel cost  Propose using same cost as 2017 Model CA Clean Air Initiative (AB 32)

16 Kevin Harris ColumbiaGrid (503)

Appendix 17

Study Objectives 18 Main focus; Identify grid impacts  Identify potential flow issue associated with replacement capacity of potential coal retirement in the Northwest Outside the scope of this study  System reliability (stability, Var, frequency responses etc)  Projects evaluation (transmission, plant, technology) Key factors to be monitored  Power flow (congestion, utilization, limitations etc)  Prices

Study Approach – Basic Assumptions 19 Assume resources retirement in Northwest  Base Case: Centralia (1,340 MW)  Scenario: Plus Colstrip 1&2 (614 MW) Assume replacement capacity to be:  Equivalent to retired coal capacity  Same base sizes at varied locations Replacement capacity:  Generic Combine Cycle (CC): F-Frame CC consisting of 330 MW of CC and 50 MW of duct fired burner (DB)  Boardman is replaced by an additional G-Frame CC in the Boardman area

Study Approach – Basic Assumptions 20 Locations of replacement capacity:  Centralia area (I-5 between Seattle and Portland)  North of the greater Seattle area and south of Canadian boarder  Stanfield (McNary through Boardman area)

Base Case 21 Centralia retirement: 1,340 MW Equaling replacement capacity: 4 x generic CC (4x330 MW CC):=1,320 MW  It would include 200 MW of DB for a net CC of 1,520 MW Proposed Base Case: CaseAbbrvCentraliaNo of SEAStanfield Base 1B1400 Base 2B1310 Base 3B2202

Sensitivity 1 - Colstrip 22 Potential retirement of Colstrip 1&2: 620 MW Equaling replacement capacity: 2 x generic CC (2x330 MW CC):=660 MW  It would include 100 MW of DB for a net CC of 760 MW Proposed Base Case: CaseUsed Base CentraliaNo of SEAStanfield 1aB1101 1bB2011 1cB3002

Sensitivity 1 - Colstrip 23 Net unit by area for sensitivity 1 CaseUsed Base CentraliaNo of SEAStanfield 1aB1501 1bB2321 1cB3204

Sensitivity 2 – Montana Wind 24 Montana Wind Sensitivity assumes:  Retirement of Colstrip 1 & 2  Replacement capacity installed in WA/OR  Assume 600 MW of wind is installed in Montana  Path ratings are assumed to remain the same  Changes to Special Protection Scheme (SPS), additional system changes or associated cost are not considered in the analyst Net CC units installed by: CaseUsed Base CentraliaNo of SEAStanfield 2b1b321 2c1c204