Western Renewable Energy Zone Project October 29, 2009 John Savage Oregon Public Utility Commission

2 OUTLINE Background Current Status Next Steps

3  Western Governors Association Initiative - Identify and map renewable resource-rich areas - Build transmission to ship electricity from renewable zones to load centers. “Unprecedented challenges face the West in meeting the growing demand for electricity while achieving local and global environmental goals. The WREZ Project will help us tap our vast renewable resources and develop transmission that considers communities, environmental impacts and costs.” Utah Governor Jon Huntsman WGA Chairman WREZ at a Glance

4 Genesis of Project Offshoot of Western Governors’ Clean and Diversified Energy Initiative (2006) Goal of developing 30,000 megawatts of clean energy by 2015 Advisory committee identified lack of transmission as key obstacle and made recommendations for reform September 2007: Western Governors’ Summit on Transmission and Renewables identified WREZ project as a next step December 2007: Governors submit proposal to U.S. Department of Energy Secretary Bodman to fund WREZ project May 28 and 29, 2008: Kick-off meeting in Salt Lake City

5 WREZ Phases Phase 1 and Phase 2 Identify developable renewable energy zones Develop renewable resource supply curves for each zone Develop model to estimate delivered price of power from renewable energy zones to load centers Develop conceptual transmission plans Phase 3 and Phase 4 Foster coordinated renewable resource acquisition Facilitate interstate transmission for renewables

WREZ Phase 1 Report In June 2009, the Western Governors issued WREZ Phase 1 Report Report identified 54 renewable resource hubs Sites have high quality and developable resource Sites have at least 1,500 megawatts of renewable resource capacity within 100 miles Hubs have the potential to generate: 95,000 megawatts of wind 87,000 megawatts of solar 17,000 megawatts if hydro, geothermal and biomass 6

WREZ ‘Hubs” 7

Major Transmission Proposals and WREZ Hubs 8

Transmission Planning Request Case 1. Transmission needed to move power from preferred renewable energy zones to load centers: ▪ 10 year analysis ▪ Meet renewable portfolio standard targets throughout the west Case 2. Transmission needed to move power from preferred zones to loads: 20 year analysis ▪ 33% Renewable Portfolio Standard Target ▪ 50% reduction in CO² emissions Case 3. Case 1 with higher renewable resource penetration and 25 to 40 % CO² emission reductions Case 4. Superhighway Network Overlay 9

WREZ Generation and Transmission Model WREZ Model is used to estimate the delivered price of power from a hub to a load center Model and data-base made public in June Excel – based User can change assumptions Model being refined to include resource supply curves from all REZs for each load center 10

Next Steps Western Governor’s Topic B proposal to U.S. Department of Energy asked for funding to complete WREZ Phase 3 and Phase 4 Phase 3 tasks: Procure resource from hubs Identify zones of interest to multiple utilities Seek collaboration among those utilities and their PUCs to develop common procurement schedules for projects in preferred zones Aim is to create a critical mass that would justify new transmission to preferred zones 11

Next Steps (cont’d) Phase 4 tasks: Facilitate coordinated siting and foster interstate discussions on cost allocation Produce and analyze case studies of transmission siting Develop regional response to proposed federal actions related to transmission siting Organize regional forums on improvements in siting practices Identify cost allocation options and facilitate a stakeholder process that leads to an interconnection- wide policy on cost allocation Encourage cost allocation negotiations on specific projects 12