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A City-Utility Energy Partnership for Tucson?

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A city in the sunny southwest, Tucson is wondering how it can maximize its use of cost-effective, economy-boosting solar power. Is a partnership with the electric utility, as seen in Minneapolis, the answer?

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A City-Utility Energy Partnership for Tucson?

  1. 1. A C T I VAT I N G A N E N E R G Y PA R T N E R S H I P F O R T U C S O N ? John Farrell February 18, 2015
  2. 2. H U G E P O T E N T I A L
  3. 3. POTENTIAL PERCENT OF POWER FROM LOCAL RENEWABLES 100% or more 50 to 100% 25 to 50% 10 to 25% 10% or less L O C A L R E N E WA B L E P O T E N T I A L 32 states - 100%+
  4. 4. What percent of Arizona electricity could come from rooftop solar alone? I N T E R A C T I V E
  5. 5. 20% 23% 49% 42% 31% 18% 23% 24% 19% 19% 28% 23% 24% 24% 26% 21% 12% 11% 52% 51% 22% 23% 21% 23% 19% 14% 38% 41% 26% 35% 28% 19% 25% 21% 25% 24% 20% 22% 19% 23% 17% 23% 18% 20% 15% 24% 21% 18% Residential and Commercial roofs L O C A L S O L A R P O T E N T I A L POTENTIAL PERCENT OF POWER FROM LOCAL ROOFTOP SOLAR 50% or more 25 to 50% 10 to 25% 0 to 10% 21% 49%
  6. 6. 0¢ 5¢ 10¢ 15¢ 20¢ Residential Commercial Residential with ITC Commercial with ITC Prairie Fire Solar Green Valley 0¢ 5¢ 10¢ 15¢ 20¢ 0¢ 5¢ 10¢ 15¢ 20¢ T U C S O N S O L A R AT PA R I T Y ? cents per kilowatt-hour U T I L I T Y ( T E P ) R AT E S M O D E L E D A C T U A L ( P I M A C O U N T Y ) 30% tax credit 30% tax credit NREL System Adivsor Model
  7. 7. $0 $3,000 $6,000 $9,000 $12,000 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 Wind Solar Source: Lawrence Berkeley Labs A N D O N LY G E T T I N G B E T T E R U.S. Installed Cost of Wind and Solar Power ($/kilowatt)
  8. 8. 0¢ 3¢ 6¢ 9¢ 12¢ 2004 2005 2006 2007 2008 2009 2010 2011 2012 R I S I N G AV E R A G E R E TA I L E L E C T R I C I T Y P R I C E S I N T U C S O N ¢ per kilowatt-hour Source: EIA +2.8% per year since 2008
  9. 9. But rates = bills
  10. 10. W H AT W I L L B E A D D E D ? C U M U L AT I V E C A PA C I T Y A D D I T I O N S T U C S O N E L E C T R I C P O W E R ( T E P ) 2 0 1 4 R E F E R E N C E P L A N 0 500 1000 1500 2000 2500 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 TEP 2014 IRP, p26
  11. 11. C I T Y- U T I L I T Y D I S S O N A N C E
  12. 12. Are you Canadian? I N T E R A C T I V E
  13. 13. Owned by Canadian company, Fortis Governed by AZ Corporation Commission
  14. 14. M I L L I O N T O N S O F G H G E M I S S I O N S 4 5 6 7 8 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 T U C S O N C L I M AT E P R O B L E M Other 40% Tucson Electric Power 60% Sources: Pima County GHG Inventory, TEP 2014 IRP
  15. 15. U T I L I T Y R E S O U R C E M I X 2 0 1 3 Efficiency/Other 4% Renewable 4.0% Coal 80% Gas 12% Source: TEP 2014 IRP
  16. 16. U T I L I T Y R E S O U R C E M I X 2 0 2 8 Efficiency/Other 11% Renewable 9.6% Coal 43% Gas 36% G H G - 2 7 % E L E C . - 1 6 % T O TA L Source: TEP 2014 IRP
  17. 17. M I L L I O N T O N S O F G H G E M I S S I O N S 4 5 6 7 8 1990 1994 1998 2002 2006 2010 2014 2018 2022 2026 Actual emissions Projected based on TEP IRP Kyoto reduction goal R E S U LT S O F U T I L I T Y R E S O U R C E P L A N … Source: TEP 2014 IRP
  18. 18. M I L L I O N T O N S O F G H G E M I S S I O N S 0 2 4 6 8 1990 1994 1998 2002 2006 2010 2014 2018 2022 2026 2030 2034 2038 … N O T N E T Z E R O N E T Z E R O 2 0 4 0 – – C I T Y ’ S L I K E LY G O A L
  19. 19. F O R E C A S T A G A I N S T T H E G R A I N 0 3,000 6,000 9,000 12,000 15,000 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 Source: World Bank, 2014 TEP IRP Per capita electricity use, United States T E P F O R E C A S T
  20. 20. A R I Z O N A C O S T O F C O A L D E L I V E RY 0 10 20 30 40 2010 2011 2012 2013 C O S T LY C O A L R E L I A N C E $ per short ton Source: EIA
  21. 21. C O S T LY C O A L R E L I A N C E Coal 43% $161 million in compliance with pollution law by 2018 Source: TEP 2014 IRP
  22. 22. • 1200 MW of new capacity planned • 50+ year commitment • 350 gallons of water per MWh • Cost of $88-119 per MWh T H I S I S A G A S Source: TEP 2014 IRP
  23. 23. T H I S I S A G A S Twice as much natural gas capacity planned as solar power
  24. 24. 0¢ 5¢ 10¢ 15¢ 20¢ 8.8¢ 16.6¢ U T I L I T Y ’ S C O S T F O R E C A S T cents per kilowatt-hour U T I L I T Y ( T E P ) C L A I M 11.9¢ Source: TEP 2014 IRP
  25. 25. 0¢ 5¢ 10¢ 15¢ 20¢ 8.8¢ 11.1¢ T U C S O N ’ S A C T U A L C O S T O F S O L A R cents per kilowatt-hour U T I L I T Y ( T E P ) C L A I M 11.9¢ 16.6¢ “integration” Source: TEP 2014 IRP
  26. 26. “integration” “We have to back up every kilowatt of solar every minute of every day”
  27. 27. D I S - I N T E G R AT I O N Utility and neighbors have a 33% reserve margin (WECC) Source: TEP 2014 IRP
  28. 28. D I S - I N T E G R AT I O N solar resource is predictable
  29. 29. D I S - I N T E G R AT I O N Source: http://ilsr.org/solving-solars-variability-more-s I N T E G R AT I O N C O S T S FA L L W I T H D I S P E R S I O N 
 ( $ P E R M W H ) 0 10 20 30 40 1 solar plant 5 solar plants 25 solar plants $2.70 $10.80 $39.00
  30. 30. D I S - I N T E G R AT I O N Efficiency/Other 4% Renewable 4.0% Coal 80% Gas 12% Integration costs are minimal when solar is a tiny fraction of grid resources
  31. 31. 0¢ 5¢ 10¢ 15¢ 20¢ 8.8¢ 11.1¢ T U C S O N ’ S A C T U A L C O S T O F S O L A R cents per kilowatt-hour U T I L I T Y ( T E P ) C L A I M 11.9¢ adjusted
  32. 32. 0¢ 5¢ 10¢ 15¢ 20¢ 8.8¢ 11.1¢ 0¢ 5¢ 10¢ 15¢ 20¢ 4.37¢ 11.1¢ T U C S O N ’ S A C T U A L C O S T O F S O L A R U T I L I T Y ( T E P ) C L A I M M O D E L E D adjusted 30% tax credit 30% tax credit 11.9¢ Source: System Advisor Model
  33. 33. 0¢ 5¢ 10¢ 15¢ 20¢ 8.8¢ 11.1¢ 0¢ 5¢ 10¢ 15¢ 20¢ 4.37¢ 11.1¢ 0¢ 5¢ 10¢ 15¢ 20¢ Utility scale solar Residential Commercial Prairie Fire Solar Green Valley 5.7¢ 9.6¢ T U C S O N ’ S A C T U A L C O S T O F S O L A R U T I L I T Y ( T E P ) C L A I M M O D E L E D A C T U A L ( P I M A C O U N T Y ) adjusted C R E D I B I L I T Y G A P 30% tax credit 30% tax credit 11.9¢
  34. 34. 0¢ 5¢ 10¢ 15¢ 20¢ 8.8¢ 11.1¢ 0¢ 5¢ 10¢ 15¢ 20¢ 4.37¢ 11.1¢ 0¢ 5¢ 10¢ 15¢ 20¢ Utility scale solar Residential Commercial Prairie Fire Solar Green Valley 5.7¢ 9.6¢ T U C S O N ’ S A C T U A L C O S T O F S O L A R U T I L I T Y ( T E P ) C L A I M M O D E L E D A C T U A L ( P I M A C O U N T Y ) adjusted 30% tax credit 30% tax credit 11.9¢ SOLAR SAVINGS OVER GAS
  35. 35. WAT E R
  36. 36. WAT E R I S L I M I T E D • Central Arizona Project has lowest water rights from Colorado river • Water storage will cover shortage but less water sales mean higher rates
  37. 37. L O T S O F WAT E R F O R P O W E R T U C S O N WAT E R U S E TEP 15% 85%
  38. 38. M I N N E A P O L I S : A M O D E L C I T Y- U T I L I T Y PA R T N E R S H I P ?
  39. 39. A S I M I L A R C H A L L E N G E
  40. 40. Minneapolis Energy Options Taking charge of our energy future G R A S S R O O T S A C T I O N
  41. 41. Clean Local Equitable Affordable Reliable Minneapolis Energy Options Taking charge of our energy future
  42. 42. E N E R G Y O P T I O N S 2 0 1 2 Franchise • 20 years • $23 million for city general fund • expiring 2014 Municipal utility
  43. 43. O R G A N I Z I N G L E D T O O P T I O N S
  44. 44. Franchise reform Community Choice Aggregation Partnership E N E R G Y O P T I O N S 2 0 1 4 Franchise • 20 years • $23 million for city general fund • expiring 2014 Municipal utility
  45. 45. C I T Y- U T I L I T Y PA R T N E R S H I P
  46. 46. 2 - Y E A R W O R K P L A N Minneapolis Energy Options Taking charge of our energy future B + Building benchmarking Community-driven energy efficiency Community solar LED streetlights Pay back on the bill
  47. 47. C O N S TA N T V I G I L A N C E
  48. 48. W H Y F O C U S O N L O C A L P O W E R ?
  49. 49. $48 billion at stake
  50. 50. S O L A R I S VA L U A B L E
  51. 51. 0¢ 2¢ 4¢ 6¢ 8¢ 10¢ 12¢ 14¢ Energy Gen. capacity Environment T&D Deferral Loss Savings 12.8¢ (per kWh) Source: The Value of Distributed Photovoltaics to Austin Energy and the City of Austin Austin Energy Value of Solar Tariff
  52. 52. $0.00 $0.03 $0.06 $0.08 $0.11 $0.14 Brown energy replacement Avoided transmission losses Environmental (RPS compliance) Avoided transmission access Local capacity value (per kWh) Palo Alto CLEAN Program 13.5¢
  53. 53. $0.00 $0.03 $0.06 $0.08 $0.11 $0.14 Brown energy replacement Avoided transmission losses Environmental (RPS compliance) Avoided transmission access Local capacity value (per kWh) Minnesota Value of Solar 12¢
  54. 54. C O S T S H I F T ? 0 3 6 9 12 Value of solar (MN) Net metering payment (MN) Solar producers provide subsidy for non-solar ratepayers
  55. 55. L O C A L P O W E R VA L U E Over 25 years, locally owned = $5 million of electricity spending in local pockets. Source: NREL JEDI economic model 1 Megawatt $2.5 million dollars and 20 construction jobs
  56. 56. L O C A L P O W E R VA L U E Not local 0 25 50 75 100 very negative negative neutral positive very positive Comparing two towns with nearby wind projects. When one is locally owned, it means…
  57. 57. L O C A L P O W E R VA L U E Supporting increased use of local wind energy Not local 0 25 50 75 100 very negative negative neutral positive very positive -44% +33% +77% net approval Local Ownership
  58. 58. Other 54% Individuals & Farmers 46% Germany’s Energy Revolution Still People Powered 29,000 MW 20% renewable
  59. 59. T H E F U T U R E F O R L O C A L E N E R G Y
  60. 60. EQUITABLELOCAL LOW- CARBONEFFICIENTFLEXIBLE LOW-CARBONEFFICIENTFLEXIBLE LOCAL EQUITABLE FIVE PILLARS OF ENERGY DEMOCRACY “Utility 2.0” pillars $48 billion opportunity “Utility 3.0”
  61. 61. E N E R G Y D E M O C R A C Y I N A C T I O N INDEPENDENT LOCAL GRID MANAGER = super efficient buildings
  62. 62. L O C A L P O W E R O P P O R T U N I T Y S A N TA F EB O U L D E R 2x Coal same
  63. 63. LEVERAGE UtilitiesCities need
  64. 64. www.ilsr.org R E A D M O R E @johnffarrell F O L L O W A L O N G

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