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NOAA Forecasters Predict Above-Average Hurricane Activity This Year

May 25, 2022

by Paul Ciampoli
APPA News Director
May 25, 2022

Forecasters at the National Oceanic and Atmospheric Administration’s (NOAA) Climate Prediction Center are predicting above-average hurricane activity this year, which would make it the seventh consecutive above-average hurricane season.

NOAA’s outlook for the 2022 Atlantic hurricane season, which extends from June 1 to November 30, predicts a 65% chance of an above-normal season, a 25% chance of a near-normal season and a 10% chance of a below-normal season.

For the 2022 hurricane season, NOAA is forecasting a likely range of 14 to 21 named storms (winds of 39 mph or higher), of which 6 to 10 could become hurricanes (winds of 74 mph or higher), including 3 to 6 major hurricanes (category 3, 4 or 5; with winds of 111 mph or higher). NOAA provides these ranges with a 70% confidence.

The increased activity anticipated this hurricane season is attributed to several climate factors, including the ongoing La Niña that is likely to persist throughout the hurricane season, warmer-than-average sea surface temperatures in the Atlantic Ocean and Caribbean Sea, weaker tropical Atlantic trade winds and an enhanced west African monsoon.

An enhanced west African monsoon supports stronger African Easterly Waves, which seed many of the strongest and longest-lived hurricanes during most seasons, NOAA said.

Texas Generator Brings 260-Megawatt Battery Storage Project Online

May 25, 2022

by Paul Ciampoli
APPA News Director
May 25, 2022

Texas-based power generator Vistra on May 23 announced that its DeCordova Energy Storage Facility in Granbury, Texas, is now online. The 260-megawatt/260 megawatt-hour battery energy storage project is the largest of its kind in Texas, according to Vistra.

Jim Burke, Vistra president and chief financial officer, said that the facility “offers a unique value proposition — not only can this battery system provide instantaneous full power to the grid with the flip of a switch, but it is also co-located on the same site as our quick-start DeCordova natural gas-fueled power plant.”

He said that this pairing “means we essentially have a large, one-hour battery system with dispatchable, reliable generation, leading to continuity of operation and resiliency of the grid. In addition, these gas-fueled generation units have seven days of diesel backup in the event of any disruption of natural gas supplies, which is yet another example of the resiliency aspect of the Decordova site.”

First announced in September 2020, DeCordova is the second of seven new zero-carbon projects Vistra is bringing online in Texas over the next few years as part of its growing Vistra Zero portfolio. These new power generation facilities represent a nearly $1 billion capital investment by the company within the Electric Reliability Council of Texas (ERCOT) market.

DeCordova Energy Storage Facility utilizes lithium-ion technology housed in containers that, in addition to project inverters, were supplied by Sungrow, the project integrator. Mortenson provided engineering and construction expertise.

Project construction began in June 2021 and was finished in less than a year.

Along with DeCordova and Brightside Solar Facility, Vistra is also completing the 108-MW Emerald Grove Solar Facility in Crane County ahead of summer.

The American Public Power Association’s Public Power Energy Tracker is a resource for association members that summarizes public power energy storage projects that are currently online. The tracker is available here.

ISO New England Sees Electrification Driving Demand By 14% Over The Next 10 Years

May 25, 2022

by Peter Maloney
APPA News
May 25, 2022

Electrification is projected to increase annual net electricity use in ISO New England by 14 percent over the next decade, according to a report by the ISO.

The report, 2022-2031 Forecast Report of Capacity, Energy, Loads, and Transmission (CELT), looks at the long-term forecast for energy consumption and peak demand, including 10-year forecasts accounting for the impacts of energy efficiency and behind-the-meter solar generation, as well as capacity with supply obligations and total generating capability. The report also breaks down the region’s generating plants by fuel type.

The ISO develops a gross long-term forecast for electricity demand using state and regional economic forecasts, years of New England weather history, and forecasts for energy demand to power electric vehicles (EVs) and air-source heat pumps. The results of the ISO’s energy efficiency and behind-the-meter solar power forecasts are deducted from the gross forecast to arrive at a net demand forecast.

The report projects gross electric demand of 164,965 gigawatt hours (GWh) in 2031 compared with 140,536 GWh in 2022, and net demand of 140,805 in 2031. Electric vehicles are expected to account for 5,934 GWh of demand in 2031, while air-source heat pumps are expected to account for 3,056 GWh of demand that year. The ISO forecasts energy efficiency will reduce demand by 16,468 GWh in 2031 and behind-the-meter solar installations will reduce demand by 7,692 GWh by 2031.

Assuming average weather conditions, the report projects peak summer demand at 29,519 megawatts (MW) gross and 25,322 MW net in 2031, compared with 27,743 MW and 24,686 MW gross and net, respectively, in 2022.

If weather is hotter than usual, the report estimates peak summer demand of 31,336 MW gross and 27,139 MW net by 2031, compared with 29,472 MW gross and 26,416 MW net in 2022.

Under average weather condition, the ISO forecasts peak winter demand at 25,880 MW gross and 22,852 net in 2031, compared with 22,031 MW gross and 20,009 MW net in 2022.

Under average weather condition, the ISO forecasts peak winter demand at 25,880 MW gross and 22,852 net in 2031, compared with 22,031 MW gross and 20,009 MW net in 2022.

If weather is colder than average, the ISO estimates gross winter demand of 26,725 MW and net demand of 23,696 MW in 2031, compared with 22,717 MW gross and 20,695 MW net in 2022.

The demand forecast report is the primary source for assumptions used in the ISO’s system planning and reliability studies.

CPS Energy Reaches Agreement For 300-Megawatt Solar Project

May 24, 2022

by Paul Ciampoli
APPA News Director
May 24, 2022

Texas public power utility CPS Energy has reached agreement with Consolidated Edison Development Inc. for a 300-megawatt (MW) solar project that will be located in Goliad County, Texas.

The project, dubbed Peregrine Solar, is expected to increase CPS Energy’s total solar capacity to 852 MW once it comes online.

The project is the first part of the San Antonio-based utility’s “FlexPOWER Bundle” initiative. 

Construction is scheduled to begin next year and is expected to add 250–300 temporary jobs with priority hiring from the San Antonio area. As part of the partnership agreement, Con Edison Development will contribute $500,000 over a 10-year period to support one of CPS Energy’s community priorities of supporting customers and education.

Con Edison Development also will hire up to eight positions from Greater San Antonio and maintain $750,000 in annual spending with local suppliers and vendors through the life of the 25-year agreement. This will result in a $19 million local investment for Bexar and Goliad counties.

The FlexPOWER Bundle initiative aims to further diversify CPS Energy’s power generation mix, adding up to 900 MW of solar, up to 50 MW of energy storage and up to 500 MW of firming capacity.

Launched in November 2020, a request for proposals for the FlexPOWER Bundle resulted in over 650 proposals from 100 companies across the U.S. and ten other nations, including Japan, England and South Korea.

CPS Energy expects to finalize and award all FlexPOWER Bundle contracts within the next few months with the next solar selections expected in the coming weeks.

Consolidated Edison Development is a subsidiary of Con Edison Clean Energy Businesses, Inc., which will be solely responsible for the construction, operation, and maintenance costs of the project.

CPS Energy will acquire the solar energy produced at Peregrine through a 25-year power purchase agreement.

PJM Says $3 Billion Needed To Prepare Its Grid For Renewables Influx

May 24, 2022

by Peter Maloney
APPA News
May 24, 2022

As much as $3 billion will needed to be invested in grid enhancements to accommodate a growing amount in renewable resources expected in the PJM Interconnection region, according to a new report by the regional transmission organization.

The Grid of the Future: PJM’s Regional Planning Perspective report aims to ensure that PJM’s grid maintains the reliability and operational flexibility needed to address key drivers that are changing the face of the industry.

Over the next 15 years, PJM anticipates more than 100,000 megawatts (MW) of onshore wind, offshore wind, solar power and energy storage resources will come online in the PJM region, which already has 15,000 MW of renewable resources in service.

“The grid of the future is happening now, and this paper details the road map that will help us plan the transmission system to enable the shift to renewable generation resources that are smaller, more dispersed, and more variable in output than the existing fleet,” Suzanne Glatz, director of strategic initiatives and interregional planning at PJM, said in a statement.

The PJM region includes all or part of 13 states and the District of Columbia.

In the report, PJM planners identified and examined industry trends driving grid expansion, including generation development, evolving load characteristics, emerging transmission technologies and resilience.

The resulting road map for PJM’s Regional Transmission Expansion Plan (RTEP), which identifies transmission system additions and improvements needed to maintain the flow of electricity in the region, encompasses four focus areas.

PJM said it would conduct transmission build-out scenarios studies this year that will build on its renewable integration and offshore wind studies and include further analysis of the potential impacts of greater transportation and building electrification.

PJM said it would continue to conduct targeted reliability studies to explore generation and transmission attributes such as reactive control, stability, system inertia and frequency control, and short-circuit impacts.

PJM said it would also continue to study and implement improvements to its RTEP process. In April, PJM’s planning committee endorsed a proposal aimed at moving generation and other projects through its planning pipeline more quickly to help clear the current backlog.

And PJM said the road map also focuses on regulatory policy impacts that will inform new reliability criteria for such eventualities as extreme events, state electrification policies and Federal Energy Regulatory Commission (FERC) action on regional transmission planning.

In April, FERC directed grid operators to provide information regarding their changing system needs and plans for potential reforms.

Department of Energy Launches $3.5 Billion Carbon Capture And Storage Program

May 23, 2022

by Paul Ciampoli
APPA News Director
May 23, 2022

The U.S. Department of Energy (DOE) on May 19 released a notice of intent (NOI) to fund the infrastructure law’s $3.5 billion program for carbon dioxide (CO2) capture and storage.

The Regional Direct Air Capture Hubs program will support four large-scale, regional direct air capture hubs that each comprise a network of carbon dioxide removal (CDR) projects.

DOE noted that direct air capture is a process that separates CO2 from ambient air. The separated CO2 is then permanently stored deep underground or converted for use in long-life products like concrete that prevent its release back into the atmosphere.

Each of the projects selected for the Regional Direct Air Capture Hubs program will demonstrate the delivery and storage or end use of removed atmospheric carbon.

The hubs will have the capacity to capture and then permanently store at least one million metric tons of CO2 from the atmosphere annually, either from a single unit or from multiple interconnected units. 

For more information, read the NOI here.

DOE will host a virtual Carbon Negative Shot Summit on July 20 and 21, 2022.

Fitch Affirms Connecticut Municipal Electric Energy Cooperative, Transmission Entity Ratings

May 23, 2022

by Paul Ciampoli
APPA News Director
May 23, 2022

Fitch Ratings has affirmed ratings for Connecticut Municipal Electric Energy Cooperative (CMEEC) and Connecticut Transmission Municipal Electric Energy Cooperative at “AA-.” The rating agency cited, among other things, ample liquidity, very low leverage and a strong operating risk profile.

The Rating Outlook is Stable.

Fitch affirmed the following ratings at AA- for CMEEC:

It also affirmed the AA- rating for $16.3 million 2021 series A, transmission system revenue bonds for Connecticut Transmission Municipal Electric Energy Cooperative.

The Connecticut Transmission Municipal Electric Energy Cooperative was created by CMEEC in 2009. As a separate joint action agency, it acquired local transmission assets in order to provide transmission services required by CMEEC for its members and customers.

Fitch said that the ‘AA-‘ long-term bond ratings and IDR for CMEEC and the Connecticut Transmission Municipal Electric Energy Cooperative “reflect very strong revenue defensibility, a stable consolidated financial profile, with ample liquidity and very low leverage, and a strong operating risk profile.” The rating “also incorporates limited capital spending needs and a declining debt burden, which should allow leverage ratios to remain very low,” Fitch said.

Revenue defensibility is based on the long-term, all-requirements contracts and strong member credit quality that supports CMEEC’s revenue base, Fitch said.

“Operating costs are low, although energy supply is concentrated in near-to-medium term market power purchases, subjecting CMEEC to potential variability in market pricing. A comprehensive hedging policy helps mitigate this risk, although costs are still expected to rise. Capital plans are limited to minor maintenance with no new debt requirements projected through 2026,” it said.

“We are pleased by this rating affirmation,” said CMEEC Chief Executive Officer Dave Meisinger. “We believe Fitch recognized our strong overall financial profile and metrics, combined with appropriate long-term decisions such as the recent divestiture of our largest generation asset and a renewed focus on mapping out a path toward cost-effective reduction of our carbon footprint.”

Meisinger concluded that, “our stable ratings outlook helps ensure that CMEEC and its member municipal electric utilities will have competitive access to financial markets, which further positions the CMEEC members to maintain their reasonable retail electric rates.”

CMEEC’s member municipal electric utilities include Norwich Public Utilities, Jewett City Department of Public Utilities, Groton Utilities, Bozrah Light & Power, Third Taxing District of the City of Norwalk and South Norwalk Electric and Water.

President Biden Announces Intent To Renominate FERC Chairman Glick

May 21, 2022

by Paul Ciampoli
APPA News Director
May 21, 2022

President Biden on May 20 announced his intent to renominate Chairman Richard Glick as a member and Chairman of the Federal Energy Regulatory Commission (FERC). 

Glick, a Democrat, joined FERC as a commissioner in November 2017, having been appointed by President Trump.  He was elevated to Chairman by President Biden in January 2021. 

Glick’s current term expires June 30, 2022, although he could continue to serve through the end of the year. 

Glick’s renomination would require confirmation by the Senate.

Public Power Utilities Take Proactive Approach In Response To Supply Chain Challenges

May 21, 2022

by Paul Ciampoli
APPA News Director
May 21, 2022

Public power utilities are taking a proactive approach when it comes to meeting the ongoing challenges caused by supply chain disruptions through a series of actions that include working to boost inventory levels, placing orders into next year and expanding communication and relationships with developers.

[This is the second of a three-part series detailing public power’s response to supply challenges. Click here to read the first part of the series].

Lenoir City Utilities Board Sends Letter to Developers And Contractors

On March 15, 2022, M. Shannon Littleton, General Manager for Tennessee public power utility Lenoir City Utilities Board (LCUB), sent a letter to developers and contractors related to supply chain issues.

“Due to LCUB’s rapid growth and supply chain issues that the entire nation is facing, our procurement, engineering, and operations teams have become increasingly concerned about inventory of materials like transformers, power poles and meters,” Littleton wrote.

“As suppliers started to miss delivery dates, our teams began to meet regularly to develop a strategy to mitigate the impact of the delays through our design, procurement, and construction processes. We are managing inventory the best we can by creating alternative designs to maximize efficiency and seeking out new products and manufacturers,” Littleton said in the letter.

“Even with our efforts, more must be done to ensure we have adequate reserves to address weather events and provide permanent power to a growing system,” he said.

“We have decided to reserve single-phase equipment for completed construction projects and service restoration, when needed. Single-phase equipment is used primarily for residential and small commercial projects. The impact to builders is they will not be able to use a temporary power supply during construction unless there is existing infrastructure that we can connect to; they will have to rely on a generator,” Littleton wrote, adding that new permanent installations may also experience delays.

“There is no exact timeline on a resolution, but this situation is very fluid and will improve in time as equipment manufacturing delays are rectified,” he said in the letter.

Nebraska’s North Central Public Power District Keeps Eye On Supply Chain

In a recent Q&A with Public Power Current, Doyle Hazen, General Manager and CEO of Nebraska public power utility North Central Public Power District (NCPPD), described how NCPPD has taken a proactive approach when it comes to addressing supply chain issues.

“NCPPD has been monitoring the supply chain and the material markets through our relationships with our vendors,” he said. “We started ordering additional material and special equipment (transformers and reclosures) in late 2021. Proactively, we have been ordering into 2023 to stay ahead of our normal maintenance requirements, our work plan projects and expected growth of our system,” Hazen noted.

“The relationships we have with our vendors and other service providers are key in NCPPD’s ability to provide services and build projects on time. By knowing early where the market was going with our purchases both in price and availability, NCPPD was able to meet its customers’ needs. Although there is no guarantee of continued supply in any number of items, NCPPD monitors supply on a monthly, weekly and daily basis,” he said.

Mason PUD Issued Supply Chain Disruption Alert

Washington State’s Mason PUD 3 in September 2021 issued an alert in which it said that supply chain disruptions, unpredictable lead times, and unexpected price spikes of common materials “has the PUD and its customers increasingly uneasy about being able to meet construction timelines for electrical and fiber optic projects.”

The PUD said it was monitoring the situation very closely with its suppliers. “During this period, Mason PUD 3 is working to boost our inventory levels and search for additional product beyond our normal supply chains and construction practices. Although we don’t want to cause alarm, we do think that customers need to prepare accordingly,” it said.

The PUD said at the time it issued the alert that it was seeing major shortages and issues in the following areas related to the utility industry:

JEA Official Details Mitigation Strategies

At a February 2022 board meeting for Florida-based public power utility JEA, Jenny McCollum, JEA’s Chief Procurement Officer and Director of Procurement and Inventory Planning, said that “JEA started to see major disruptions around the beginning of 2021 and felt the impact across most of our inventory items.”

She said that “the specialized electric items were hit the hardest at first, followed by our water wastewater materials and then our safety items. More recently, though, we have felt impacts across all commodities including execution of our capital projects.”

McCollum said that “all of the areas of the supply chain are being affected,” which starts with the inability of manufacturers to source raw materials, transportation issues due to port closures, shipping container shortages, increased fuel costs and difficulty in hiring staff,” which has prevented most manufacturers from being able to meet normal demand, resulting in a reduction in capacity.”

She said that “the raw materials that are affecting us the most” are steel, copper, resin, aluminum and brass. The materials most impacted include transformers, valves and fittings, wire and cable, manholes and safety supplies.

“This crisis has caused focus, the need for speed and flexibility and collaboration across the company to take a comprehensive approach to mitigation efforts,” McCollum said.

Among other things, JEA is reducing terms to new contracts “and we’re adding flexibility to make price adjustments to align to the changing market.” In addition, JEA has diversified its supply base.

She pointed out that one key advantage for JEA is its use of a category management approach to procurement. This approach allows JEA “to be in a position to be nimble and quick and gives us a holistic view to all contracts and future spend plans.”

McCollum also said that “we’re expanding our communication and relationships with developers on their future plans. We are also partnering with suppliers to reserve capacity.”

At the same time, JEA is keeping an eye on the demand side of the equation when it comes to supply chain issues.

McCollum noted that the expansion of electric vehicles means that JEA is competing with EV manufacturers for the electric grade core steel “that we use in our transformers. So where their consumption in the past has been insignificant, we are seeing a major shift and there aren’t many suppliers in the market that can keep up with the growing demand.”

One new way that JEA is addressing current supply chain issues is by harvesting transformers. That means if there are transformers in JEA’s territory that are not being utilized for load due to businesses moving to another location in Jacksonville or going out of business, the utility pulls that transformer from the field and sends it to investment recovery to refurbish it. JEA then places it back into the system for new developments or repair/maintenance work.

Hannibal Board of Public Works General Manager Details Supply Chain Issues at Board Meeting

Darrin Gordon, General Manager of Missouri public power utility Hannibal Board of Public Works, addressed supply chain issues at a March 21, 2022, Hannibal Board of Public Works board meeting.

At the meeting, Gordon noted that APPA has reported that nationwide, the U.S. supply chain for electric grid equipment is becoming increasingly disrupted and that utilities were reporting increasing scarcity of electric grid components, with transformers and wires becoming scarcer.

“Those are essential,” Gordon said. “Every single one of our customers is touched by those items and with that, as that scarcity increases,” so does the delivery time and costs are escalating “and we haven’t seen the end of that yet.”

He noted that “consistently, we’ve always tried to maintain a stockyard of those parts that we may need.”

In the short run, the utility has been able to acquire items off the market, but “that market is getting more and more scarce and that stockpile that we have may become less and less adequate and the cost of keeping that is going to increase.”

TVPPA Communications Advisory Group Launches Supply Chain Toolkit

Meanwhile, the Tennessee Valley Public Power Association Inc.’s (TVPPA) Communications Advisory Group has developed a supply chain toolkit of resources.

TVPPA is the nonprofit, regional service organization that represents the interests of consumer-owned electric utilities operating within the Tennessee Valley Authority (TVA) service area.

TVPPA created the communications toolkit in response to member discussions about the challenges of sharing information about supply chain disruptions, particularly as they relate to transformers and other materials critical to servicing the needs of consumers and communities.

TVPPA members include both municipal and electric cooperatives, and they serve more than nine million people in Alabama, Georgia, Tennessee, Mississippi, Kentucky, North Carolina and Virginia.

Klickitat PUD Faces Critical Electric System Equipment Shortages

In late March 2022, Washington State’s Klickitat PUD said that it was starting to experience critical electric system equipment shortages due to the global shortage of materials and longer delivery delays from many vendors.

Jim Smith, the PUD’s General Manager, said that with material delivery delays and increased construction volumes, the utility was short on stock for its standard pad mounted transformers. These transformers take high voltage power from the PUD’s distribution lines and convert it to the 120 and 240 volts delivered to residences and businesses when underground power lines are used.  Transformers are on order and the PUD expects deliveries throughout the year, it said.

“We have been communicating with new customers and developers for months that we were expecting these shortages,” said Smith in a statement. “Existing customers should also realize that we are facing the same supply chain issues that they are seeing in stores. Delivery times are getting longer and prices are increasing across many materials.”

He noted, for example, that these transformers “normally have about a 16-week delivery time and were $1,500 each a year ago. Delivery is now more than a year out and they are being quoted at $6,000 each.”

Compounding the supply chain problem is a large increase in new construction in Klickitat County, the PUD said. The PUD would normally see about $1.4 million in new electric construction activity each year. In 2021, this increased to $2.8 million and the same is expected for 2022.

“The PUD Commissioners have directed staff to commit the funds required to allow us to keep two years of inventory in stock, rather than the normal six to twelve months,” said Smith. “We have the funds to be able to acquire these additional materials to support the increased growth in the county, but with limited supply and elevated usage, there is only so much we can do,” he said.

Department of Energy Extends Application Deadline For Civilian Nuclear Credit Program

May 21, 2022

by APPA News
May 21, 2022

The U.S. Department of Energy (DOE) on May 18 extended the deadline for applications and sealed bid submissions under the $6 billion Civil Nuclear Credit (CNC) Program that is aimed at supporting the continued operation of U.S. nuclear reactors.

Owners or operators of nuclear reactors most at risk of premature closure due to economic hardship have 47 more days from May 18 to submit applications for certification and sealed bids for credits. The deadline for the first CNC award cycle is now 11:59 p.m. Mountain Time on July 5, 2022.   

The first CNC award cycle is open to owners or operators of U.S. nuclear reactors that have already announced publicly their reactor is projected to close prior to September 30, 2026, due to economic factors. This ensures that the first award cycle is available to the reactors most at risk of imminent closure, DOE said. DOE published guidance on how to apply in April 2022. 

DOE is simultaneously developing guidance for the second award cycle under the CNC program, which will be open to more reactors. The next opportunity to apply will be in the first quarter of fiscal year 2023. 

Additional information is available here.