UPEDA Energy Update

UPEDA Energy Update (2/13/2015)Abhilash “Abhi” Kantamneni| Michigan Technological University

Houghton Winters

Source: Mining Journal

Source: Mining Gazette

Source: Michigan Tech Alumni

Source: Mining Journal

Source: boniashburn.com

MI AVERAGE RESIDENTIAL ELECTRIC RATES 2013[$/KWH]

MI Average: $0.14/kWhSource: MPSC Utility Company Annual Reports 2013

Residential Electric Rates

Residential Electric Rate Increases

MI AVERAGE RESIDENTIAL ELECTRIC RATE INCREASE 2001-2013

MI Average: 74%

Source: MPSC Utility Rates Summary

Average Residential Electricity Retail Rates by State (2013)

StateAverage Price

[$/kWh]Hawaii $0.37

Houghton $0.21-$0.24New York $0.19

Alaska $0.19Connecticut $0.18

Vermont $0.18New Hampshire $0.17

California $0.16New England $0.16

Middle Atlantic $0.16Massachusetts $0.16

New Jersey $0.16Michigan $0.15 Source: www.eia.gov

MI Average: $0.11/kWhSource: MPSC Utility Company Annual Reports 2013

Commercial Electric Rates

MICHIGAN COMMERCIAL UTILITY RATES 2013 [$/KWH]

Commercial Electric Rate Increases

MICHIGAN COMMERCIAL UTILITY RATE INCREASES 2001- 2013 [%]

Source: MPSC Utility Company Annual Reports 2013

Michigan Tech KRC Photovoltaic Research Center

Location: Tree Cover and Solar Window

Image Source: www.solarfeeds.com

Best Summer Angle: 30*

Best Winter Angle: 60*

Best Average Angle: 47*

Advantages of High Module Tilt: Albedo

Source: nsidc.org

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

Day of the Year

Solar Irradiation and Albedo

S_Horizontal (W/m^2) Albedo (W/m^2)

Source: MTU KRC

Advantages of High Module Tilt: Snow Shedding

Hours since 12:00 Am Nov 1 2013

PV System Output Under Snowy Conditions

45* 30* 15*

Shedding from 45*

Source: MTU KRC

Source: Michigan Public Service Commission

Source: MTU KRC Data

Houghton Average = 3.8 Peak Sun Hours/Day*Energy = 1kW*3.8h = 3.8kWh/Day (Average)

Source: pveducation.org

*Source: MTU KRC Data

Source: MTU KRC Data

Nov-Feb total irradiance = only 8% year total

Source: www.nrel.gov

Utility Fuel Source Summary

Fuel Source USA OCREA UPPCO Region

Coal 39.10% 63.80% 54.11% 59.43%

Nuclear 19.18% 23.10% 23.08% 25.36%

Gas 27.57% 5.50% 8.90% 9.77%

Oil 0.67% 0.10% 0.50% 0.55%

Hydroelectric 7.07% 3.40% 9.55% 0.65%

Biofuel 0.00% 0.00% 0.45% 0.49%

Biomass 0.92% 0.10% 0.41% 0.45%

Wind 4.11% 2.80% 2.50% 2.75%

Wood 0.48% 0.10% 0.44% 0.49%

Other 0.71% 1.10% 0.50% 0.44%

Solar 0.20% 0.00% 0.02% 0.02%

Source: OCREA Fuel Mix Report

Source: MPSC Regional Average Fuel Mix Disclosure

Source: EIA Total Power Industry Fuel Sources

Currently all MI utilities are on track to meet RES Compliance*

Phased integration of renewables 50% cheaper than new coal generation facilities.

*Source: MPSC Report on RES Compliance

*Figure: MIRECS 2009-2013 Credits by Energy Source

Impact of MI PA 295

Benefits of Renewables

Michigan Department of Energy, Labor & Economic Growth Report on Green Jobs says renewable energy sector job creation = 3% of all private sector employment in state

International Energy Agency Report on Energy Security says renewable energy systems reduce supply disruptions and reliance on imported fuel.

Actual Quote: “The only green that matters, is the color of my $$$$$”

(Obviously, not a philosopher)

Source: http://www.michigan.gov/mpsc

4 Investor-Owned Utility Companies

3 Rural Electric Cooperatives

19 Municipal Electric Utilities

1955• Presque Isle Power Plant

(PiPP) built by Cliffs

1980• PiPP sold to WEC.

• Iron Ore Mining CompanyCliffs:

• Generation Utility based in WisconsinWEC:

• Coal fired Power Plant in Marquette, MI. Net Generation: 431MWPiPP:

Source: WNMU Public Broadcasting

Source: www.geo.msu.edu

2000•ATC is formed

2001•MISO is formed.

• Independent System Operator (ISO)

• Maintains Reliability in Midwest Region

• Nation’s first transmission only utility

• Builds and maintains Transmission in WI, UP

• MISO and ATC create SSR Tarrifs

2008• MI PA 296 passes

• System Support Resource

• Gen. Units that HAVE to run to ensure grid reliability (92%/8% - WI/UP)

• Regulates MI Electric Utility Markets

• Electric Choice limited to 10% of retail sales and iron ore mining Facilities

MI PA 296:

Source: http://www.michigan.gov/mpsc

May 2013•Cliffs move from WEC to Integrys

Aug 2013•WEC notifies MISO of PiPP Closure

Oct 2013•MISO designates PiPP as SSR

Feb 2014•MISO agrees to pay WEC $52,230,000/year

Mar 2014• PSCW sues MISO at FERC

July 2014• FERC orders MISO to do ‘load shedding’ study

• Wisconsin Regulatory Authority

• Oversees public utilities, serves public interest PSCW:

• Federal Energy Regulatory Commission

• Regulates interstate transmission of electricity, gas and oil.FERC:

Aug 2014•MISO completes ‘load-shedding’ study

Nov* 2014•FERC schedules final settlement call

May 2014

• WE applies for ‘WEC’ LBA split into MIUP and WEC

Nov 2014• NERC approves split

(PiPP)• PiPP to remain open till 2020.

Cliffs• Cliffs to continue purchasing power from PiPP till retirement in 2020.

• UPPCO to purchase the generation and distribution assets, including PiPP, from Wisconsin based utilities We Energies and Integrys.

• UPPCO to ‘step into’ existing rate structures of We Energies and WPS (part of Integrys) customers.

Invenergy• Invenergy to build a gas-fired replacement to PiPP on Cliffs’ property in Marquette.

• MPSC to remove objections to the merger of Wisconsin Energy and the Integrys Energy Group.

• Protecting residents and businesses in the UP against SSR subsidies to keep PiPP open for reliability reasons.

Reliability

• Replacement gas-fired generation in the UP reducing dependence on out-of state coal plants while also maintaining long term reliability.

Independence

• A single U.P.-based corporation (UPPCO) providing electric service to a majority of the U.P..

‘Global Settlement Benefits’

•SSR costs from Jan – July 2015. Who Pays?

Feb 9•Cliffs returned to PiPP. Why still SSR?

•White Pine and Escanaba?

Problem 1: Existing SSR Costs

Problem 2: Long term Reliability?

Source: International Monetary Fund

Source: NYSE

•No upgrades to UP infrastructure

•MI PA 296 still exists.

•Replacing PiPP with PiPP

Problem 2: Long term Reliability?

•New gas plant for mines + some additional

•New generation after 2020?

•Transmission from WI?

Problem 3: Energy Independence?

Problem 4: Long term rates?

Residential Electric Rate Increases

MI AVERAGE RESIDENTIAL ELECTRIC RATE INCREASE 2001-2013

MI Average: 74%

Source: MPSC Utility Rates Summary

What can we do about it?SAVE SAVE SAVE!

Next Year: Wedding

Next Decade: Kids to Disneyworld

Retire: Buy a Boat

Abhi’s American Dream

Target: Wedding Guests

Target: Disneyworld

15% EE

Target: Boat

30% EE

$87$142

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Average Running Cost by Light Source

LED CFL Incandescent

+1 LED = +1 Wedding Guest

15% EE

Programmable Thermostat

-1* = ~ +3% Gas EE + ~+1% Elec. EE

Turn down water furnace

-10* = ~ 1% EE

Source: energy.gov

30% EE

Source: guep.org

MI Total: $3.3 Billion/year

UP Residential Electric Expenses

AVERAGE RESIDENTIAL ELECTRIC EXPENDITURE 2013 [MILLION $/YEAR]

MI Total: $4.7 Billion/year

UP Commercial Electric Expenses

AVERAGE COMMERCIAL ELECTRIC EXPENDITURE 2013 [MILLION $/YEAR]

Resources for Individuals

www.EfficiencyUnited.com Energy Efficiency rebates.

MichiganSaves.org EE and RE financing, no home equity required, 4-7% APR

PACE financing

www.energy.gov/energysaver/ Energy Saver Guidebook

Community Action Agency Low income weatherization assistance

www.Abhilash.me MI Solar CalculatorMI Solar GuidebookUP Energy Updates

Presentations

www.EnergizeHoughton.org Community EE tools

Resources for Small Businesses

www.EfficiencyUnited.com Energy Efficiency rebates.

MichiganSaves.org EE and RE financing for businesses

PACE financing

MI RETAP FREE onsite energy assessments

www.EnergizeHoughton.org Sign up for mailing list/updates

Resources for Industrial Parks

Abhilash (Abhi) Kantamneni

www.Abhilash.me

akantamn@mtu.edu

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