California Energy Commission California Energy Demand Preliminary Electricity Forecast July 7, 2015 Chris Kavalec Energy Assessments Division (916)

California Energy Commission Summary, California Energy Demand Preliminary Forecast (CED 2015 Preliminary) New geographic scheme Electricity consumption down slightly compared to the 2014 forecast update (CEDU 2014) because of higher electricity rates at the beginning of forecast period Much greater decrease in electricity sales and peak demand because of higher PV projections Baseline forecast only—no AAEE savings until revised forecast 2

California Energy Commission Overview of Statewide Results 3

California Energy Commission Forecast Summary: California Energy Demand Preliminary Forecast (CED 2015 Preliminary) New geographic scheme Electricity consumption down slightly compared to the 2014 forecast update because of lower EV forecast and update of standards impacts Greater decrease in electricity sales and peak demand for IOUs because of higher PV projections Baseline forecast only—no AAEE savings until revised forecast 4

California Energy Commission Three Demand Cases High Demand Case: Higher economic and demographic growth, higher climate change impacts, EV high case, lower electricity rates, less self-generation Low Demand Case: Lower economic and demographic growth, no climate change impacts, EV low case, higher electricity rates, more self- generation Mid Demand Case: Assumptions in between the high and low demand cases 5

California Energy Commission Statewide Electricity Consumption CED 2015 Preliminary Mid Case around 1,000 GWH lower than CEDU 2014 by

California Energy Commission Statewide Electricity Sales CED 2015 Preliminary Mid Case around 13,000 GWH lower than CEDU 2014 by

California Energy Commission Statewide Noncoincident Peak CED 2015 Preliminary Mid Case around 2,000 MW lower than CEDU 2014 by

California Energy Commission Statewide Consumption per Capita CED 2015 Preliminary Mid and Low Cases Increase Later in Forecast Period—EVs and Plugloads 9

California Energy Commission New Geographic Scheme 10

California Energy Commission Description of New Scheme Planning areas correspond more closely to TAC areas and balancing authority areas More forecasting zones (20); zones within California ISO developed to approximate transmission zones Continued refinement of geographic granularity 11

California Energy Commission Old Planning Area Scheme Planning Areas in Green Revised PG&E SCE SDG&E SMUD LADWP IID Burbank/Glendale Pasadena 12

California Energy Commission Description of New Scheme PG&E Planning Area becomes PG&E TAC Area SCE Planning Area becomes SCE TAC Area Northern California entities not in ISO and formerly in PG&E Planning Area combined with SMUD to give “Northern California Non- California ISO” (NCNC) Other planning areas as before 13

California Energy Commission Planning Areas and Forecast Zones 14

California Energy Commission California ISO Forecasting Zones 15

California Energy Commission Major Inputs/Assumptions 16

California Energy Commission Economic and Demographic Assumptions High Demand Case: Global Insight Optimistic Scenario Mid Demand Case: Moody’s Baseline Scenario Low Demand Case: Moody’s Lower Long- Term Growth Scenario, DOF Population Little difference from CEDU 2014 –One exception: number of households 17

California Energy Commission Statewide Number of Households All three new cases above CEDU

California Energy Commission Self-Generation Traditional electricity generation displaced by private supply used on-site –Small-scale adoptions (PV, SHW, etc.) –Larger power plants Residential and commercial adoptions based on predictive model –For CED 2015 Preliminary, residential PV modeled using actual load shapes and tiered rates for IOUs 19

California Energy Commission Statewide PV Energy Almost all of the increase comes from residential 20

California Energy Commission Statewide PV Peak Impacts CED 2015 Mid Case corresponds to over 13,000 MW capacity in 2026 in mid case 21

California Energy Commission Electric Light-Duty Vehicles EV forecast from 2013 updated Low demand case corresponds to 2013 “most likely” compliance scenario Distributed to planning areas and climate zones through regression analysis Slightly lower forecast for EV consumption due to adjustment for recent history 22

California Energy Commission Light-Duty EV Electricity Consumption Current estimate of consumption =~ 300 GWh 23

California Energy Commission Light-Duty EV Stock Total of BEV and PHEV 24

California Energy Commission Efficiency No new standards since CEDU 2014; AAEE savings in revised forecast New savings: 2015 IOU programs and 2014 POU programs program savings for IOUs and program savings for POUs adjusted downward based on EM&V results 25

California Energy Commission Effect of EM&V Adjustments: IOUs Cumulative program savings starting in

California Energy Commission Effect of EM&V Adjustments: POUs Cumulative program savings starting in

California Energy Commission Electricity Rate Cases Developed with a new staff model, which uses a simultaneous equation framework to develop revenue requirements, allocate to rate classes, and calculate average rates High, mid, and low cases developed by varying demand, carbon prices, and natural gas prices Rates increase 20-27% from in mid case 28

California Energy Commission Climate Change Impacts Based on temperature scenarios developed by Scripps Institute of Oceanography Incorporated in residential and commercial consumption forecasts through changes in degree days Incorporated in peak forecast through increases in maximum temperatures High case and mid case 29

California Energy Commission Climate Change Impacts: Electricity Consumption Much higher decrease in HDD in mid case 30

California Energy Commission Climate Change Impacts: Peak Around 650 MW impact in mid case 31

California Energy Commission Demand Response Forecast includes some “load-modifying” demand response (LMDR) –Non-event: Permanent Load Shifting, TOU –Event-based: Critical Peak Pricing, Peak-Time Rebates Total impact of 260 MW in 2026 Future forecasts may include more LMDR depending on CPUC decisions CEC-CPUC-ISO TOU analysis ongoing (will not be incorporated in forecast) 32

California Energy Commission Potential Impacts of Continued Drought Agricultural/Water Pumping Sector 33

California Energy Commission Next Steps Revised forecast in Fall 2015 –Incorporate comments –Updated historical consumption and peak –Updated econ-demo –Updated electricity rates –Additional achievable energy efficiency for both POUs and IOUs; new standards –Revised EV and PV forecasts? –Modeling issues, residential sector Comments/questions? 34