PacifiCorp 2007 Integrated Resource Plan (May 30, 2007)

PacifiCorp – 2007 IRPChapter 7 – Modeling andAs shown in the table, constraining the coal resources has the largest impact. Removing supercriticalpulverized coal increases portfolio cost by $885 million relative to the RA1 portfolio.Portfolios with a 15 percent planning reserve margin that involved restricting the CEM to selectIGCC in certain years (RA5, RA10, and RA11) averaged $557 million higher. The average costincrease for all the portfolios relative to RA1 was $368 million.Other observations concerning the relationship between portfolio cost and resource mix and timinginclude the following.● Building coal resources earlier or later than recommended by the CEM increases stochasticcost.● Lowering the planning reserve margin increases stochastic PVRR due to the costs associatedwith higher Energy Not Served. Rather than reducing investment in base load plants to meetthe lower load obligation, the CEM chooses to defer them.● Acquiring the additional 600 megawatts of wind increases stochastic cost, although theamount is smaller than for the other resource strategies.● Removing front office transactions after 2011 increases stochastic cost.Customer Rate ImpactFigure 7.10 shows the customer rate impact of each portfolio. 58 The rate impact measure is thechange in the customer dollar-per-megawatt-hour price from 2008 through 2026 due to the portfolioresources, expressed on a levelized net present value basis. As indicated, RA1 has thesmallest rate change at $3.08/MWh. RA6, which has no pulverized coal plants, has the highest at$3.31/MWh.Figure 7.10 – Customer Rate ImpactStochastic mean price change from 2008 through 2026,Levelized Net Present Value basis$3.50$3.25$3.08 $3.11 $3.11 $3.11$3.23$3.31$3.13$3.11$3.23$3.20$3.17$3.18$/MWh$3.00$2.75$2.50RA1 RA2 RA3 RA4 RA5 RA6 RA7 RA8 RA9 RA10 RA11 RA1258 The revenue requirement calculated by the CEM uses a real levelized capital charge.164