PacifiCorp 2007 Integrated Resource Plan (May 30, 2007)

PacifiCorp – 2007 IRPChapter 7 – Modeling andREGULATORY SCENARIO RISK ANALYSIS – GREENHOUSE GAS EMISSIONSPERFORMANCE STANDARDSChapter 2 identified CO 2 regulation as an important scenario risk facing the company. In additionto the CO 2 externality cost scenarios investigated for this IRP, PacifiCorp also conducted aportfolio scenario study using the CEM and PaR models where a generator-based greenhouse gasemissions performance standard, such as the one in place in California, is instituted in all ofPacifiCorp’s service territory. The purpose of the study was to determine the comparative stochasticcost, risk, and CO 2 emission impacts of a portfolio that meets performance standard requirementsas modeled using the CEM. This section first outlines the study approach and thenpresents comparative results with respect to the preferred portfolio (RA14) and the other Group 2portfolios.Scenario Study ApproachFor this study, PacifiCorp first used the CEM to determine a deterministically optimized portfolioon the basis of GHG performance standard constraints, and then manually constrained theCEM resources to yield a portfolio with an improved cost and risk profile as determined by stochasticPaR model runs. This process is similar to the one used to develop the risk analysis portfolios.The CEM was allowed to optimize resource selection and timing subject to assumptions designedto restrict resources to those that can comply with a CO 2 emission performance standard(a per-ton emissions amount comparable or less than a CCCT). The specific CEM portfolio assumptionsfor the study are as follows:• Resources available for selection by the CEM include CCCT (F and G types with ductfiring), IGCC with carbon capture and sequestration (CCS), renewables, DSM (bothClass 1 and Class 3), and combined heat and power; pulverized coal was excluded as aresource option.• No constraints were placed on resource amounts, timing, or location, except for earliestavailable in-service dates.• A total of 3,700 megawatts of renewables was made available for selection.• Renewable portfolio standards for California, Oregon, and Washington were assumed tobe in place. The RPS requirements were handled as state contributions to a gross percentageon system retail loads—the same method used for previous RPS portfolio modeling.The percentages were updated based on the March 2007 load forecast.• The quantity of front office transactions was limited to 1,200 megawatts after 2011 (700in the east and 500 megawatts in the west).• A 12 percent planning reserve margin and $8/ton CO 2 cost adder were assumed.Table 7.49 shows the cumulative capacity by resource type and simulation period for the resultingCEM portfolio solution.213