1. Scenario Planning Process Review
Gerald Harris and Richard Marrs
Quantum Planning Group
SPSG Meeting – September 14, 2016 W
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2. Why use Scenarios for WECC?
A proven and widely used tool to manage uncertainty, especially over the long term
Specifically requested by DOE based on experience
Allowed for participation of the diverse stakeholders in the SPSG
Dovetailed with the modeling process so that quantitative results could be produced which supported deeper analysis

3. Scenario Development is Iterative
Focus Question
Drivers
Matrix
Narrative
Modeling
Results
Early Indicators
Focus Question: Get a clear focus question to anchor the scenarios
Drivers: Brainstorm the factors and driving forces that might have influence
Matrix: Find a useful tool for organizing the key driving forces into a structure (matrix, relational diagrams)
Narrative: Create the stories (logic, time scale, core arguments) using the key drivers and your model
Modeling: Use modeling and research to assess scenario arguments. Brainstorm and test new strategies.
Results: Finalize scenarios and prioritize strategy results
Early Indicators: Isolate early indicators and a learning-forward agenda

4. Scenario Development Process
Focus Question
Drivers
Matrix
Members of the SPSG and stakeholders spent two days broken into four teams, each facilitated by a QPG consultant to suggest narrative elements for the four scenarios. QPG consultants, using scenario development techniques including process template panels, flip charts, post-it notes, and a sequence of steps guided SPSG members through a process that led to the narratives. Narratives were drafted based on this work by QPG, shared with SPSG members and refined over several meetings to get to the final approved scenarios.
Key Question: How will the bulk electric transmission system need to change in the next 20 years?
Focus questions:
How will the demand for electric power services in the Western Interconnection change in the next years?
How will electric supply services and the bulk electric grid need to change to accommodate that demand?
Drivers:
The evolution of regional economic growth in the WECC Regions
Technological innovation in electric supply technology and distribution systems
The evolution of electric demand in the WECC Regions
The evolution of electric supply in the WECC Regions
Changes in the regulation of electric power systems in the WECC Regions
Changes in federal regulation affecting the electric power industry
Changes in social values related to energy issues
Changes in society's preferences for sustaining environmental and natural resources
Shifts in national and global financial markets
Shifts in the availability and price of commodity fuels used in the electricity sector

5. Scenario Focus Question

6. Scenario Driving Forces
Driving forces are trends or factors in the external environment that can have an influence on the decisions and issues being addressed by the scenarios.
Technological innovation in electric supply technology and distribution systems
The course of regional economic growth in the WECC Regions
The evolution of electric demand in the WECC Regions
The evolution of electric supply in the WECC Regions
Changes in the regulation of electric power systems in the WECC Regions
Changes in federal regulation affecting the electric power industry
Changes in social values related to energy issues
Changes in society's preferences for sustaining environmental and natural resources
Shifts in national and global financial markets
Shifts in the availability and price of commodity fuels used in the electricity sector

7. EPS Scenario Drivers Key Scenario Driver Changes in:
Review of Current Trends
Technological innovation in electric supply technology and distribution systems
Continued improvement in solar energy technologies and reduction in costs
Growing investment and interests in energy storage and advanced battery systems
Growing investment in information systems at the distribution and customer level, but a lack of standards or dominant market players
Course of regional economic growth in the WECC Regions
States with grow in natural resource extraction and processing leading growth
Unsteady strength in housing markets
Growing income disparity restraining growth for the middle class
Evolution of electric demand in the WECC Regions
Insufficient economic growth to significantly change rate of growth in demand for electricity (within recent historical range)
Long term drought implications unclear, but potentially significant
Evolution of electric supply in the WECC Regions
Growing dependence on natural gas fired supply in light of drought and low gas prices
Loss of some nuclear capacity (SONGS) in CA met by natural gas
Some evidence of market failure in economic dispatch
Regulation of electric power systems in the WECC Regions
Emergence of EPA regulation to move toward clean power and address greenhouse gas emissions
Growing interests in alternative performance-based ratemaking options within States

8. EPS Scenario Drivers Key Scenario Drivers Changes in:
Review of Current Trends
Federal regulation affecting the electric power industry
Emergence of EPA regulation to move toward clean power and address greenhouse gas emissions
Potential for trade sanctions on solar imports from China to impact solar panel costs for U.S. installations
Social values related to energy issues
Intensifying debate about addressing climate change concerns with evidence of political party polarity
Concern (may be unfounded) about the costs of shifting to a cleaner power system
Society's preferences for sustaining environmental and natural resources
Younger and emerging demographic shifting toward increased preference for sustaining natural resources
More careful review of environmental impact of fracking development
Growth in and return to coal generation globally contradicts climate change policies in some regions
National and global financial markets
Global banking systems remain fragile leaving open possibility of sudden contractions
Role of the U.S. dollar and Chinese demand growth and excess savings remain dominant influences
The availability and price of commodity fuels used in the electricity sector
Fracking development being depended upon to keep natural gas prices low for the medium term
Coal exports used to offset falling U.S. demand for coal and support coal prices

9. Most Important and Uncertain Key Drivers and the Scenario Matrix
Economic Growth in the WECC Region
Technology Innovation in Electric Supply & Distribution
High & Wide Spread
Low & Limited Areas
Evolutionary & Current Patterns
Breakthroughs & Paradigm Changing
Scenario 1:
Focus on Economic Recovery
Scenario 3:
Focus on Short-Term Consumer Costs
Scenario 2:
Focus on Clean Energy
Scenario 4:
Focus on Long-Term Societal Costs

10. Scenarios and the Reference Case
The scenarios evolved from thinking beyond the Reference Case using the key drivers.
The Reference Case was also the basis of our core understanding and starting assumptions for scenario metrics.

11. Learning loop for revising scenarios
The Learning Loop
Narrative
Modeling
Results
Learning loop for revising scenarios
Focus Question: Get a clear focus question to anchor the scenarios
Drivers: Brainstorm the factors and driving forces that might have influence
Matrix: Find a useful tool for organizing the key driving forces into a structure (matrix, relational diagrams)
Narrative: Create the stories (logic, time scale, core arguments) using the key drivers and your model
Modeling: Use modeling and research to assess scenario arguments. Brainstorm and test new strategies.
Results: Finalize scenarios and prioritize strategy results
Early Indicators: Isolate early indicators and a learning-forward agenda

12. The Role of the Joint Metrics Definition Task Force (JMDTF)
Recommend quantitative variables that represent the qualitative narrative to enable modeling the scenarios
Requires a combination of research and discussion to arrive at consensus recommendations.
Stakeholders identify and agree to key quantitative variables that represent ideas important to the narrative
The JMDTF takes inputs and suggestions from key stakeholders to arrive at data inputs for those variables.

13. Scenarios-to-Modeling Inputs
Modeling Parameters
JMDTF recommends values for each scenario consistent with the scenario narrative , key drivers and policy assumptions using the 2032 Reference case as a starting point
Inputs to LTPT and Study Cases

14. Data Analysis within the LTPT
LTPT is a capital expansion (CapEx) model
Key question: given modeling inputs, where might additional transmission capacity be needed in 20 years?
Current focus on paths rather than lines

15. Analyzing Modeling Results
Which model variables have significant impacts?
Generation portfolios and transmission expansion
Key Factor Analysis
Key differences between study case results
Expected and counter-intuitive results
Comparative Analysis
Given results and strategic preferences, which indicators should be monitored to guide investment?
Early Indicators Analysis
What would modeling results indicate for future policy work?
Policy Implications

16. Overview of Key Quantitative Measures in the Scenarios in 2012 Analysis

17. Comparative Results of Scenarios
See “2013 Scenario Study Case Comparison” slide deck

18. Key Steps for SPSG in WECC Planning Results in A New Scenario
In 2014 based on SPSG interviews and an information workshop, a scenario narrative was created to capture concerns about the impact of climate change on electric reliability creating the Energy, Water and Climate Change Scenario (Scenario 5)
Study case results
Key outputs
Key results for policy
Study case development
Scenario or issue narrative development
Metrics development
Prioritization
What key issue warrant deeper study?
Where we are today
Issues Analysis
Key uncertainties impacting reliability W
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19. Energy-Water-Climate Change Scenario
Oct 2014
Workshop on energy, water and climate change
Late Oct
Discussion with SPSG: Scenario development started
Nov-Dec
Risk analysis: how might reliability and water be affected?
Mid-Nov
Scenario Planning Workshop
Dec
Scenario narrative drafted
May 2015
Final scenario narrative approved by SPSG May

20. Scenario 5 Focus Question and Uncertainties
How might changes to temperatures, water availability and water cost in the Western Interconnection affect electricity grid reliability, demand, generation availability, and the need for additional transmission?
What threats might extreme wildfires pose to the existing transmission grid?
Can the risks of drought, extreme wildfires, and inaction be assessed?
Could climate change lead to changes in water availability patterns (amount, location, timing and costs) in the Western Interconnection?
Part of the work plan for 2016 is to complete the work needed to run the Scenario 5 study case.

21. WECC Study Case Development
Annual Transmission Expansion Planning and Policy Committee (TEPPC) Study Program
Open Season – A window of time (typically one month) where WECC accepts Study Requests from any interested party to be performed on the latest dataset (Common Case, Reference Case)
WECC Staff reviews and summarizes study requests and recommends study priorities, possible study request consolidations and availability of resources to conduct studies
Studies Work Group (SWG) and Technical Advisory Subcommittee (TAS) review the study requests and WECC staff-recommended priorities and then develop a proposed work plan
TEPPC and stakeholders review the proposed work plan
Draft Study Program for stakeholder review; “Request for Reconsideration”
TEPPC finalizes and approves the Study Program

22. WECC Study Case Development Cont.
Study Case Scoping Process
WECC staff get assigned to various studies based on interest and expertise
Regular meetings/webinars with each study requestor (or group of study requestors) to scope out the details and assumptions of the case
Run Study (GV and/or LTPT)
Study Case Reporting
As a study is complete, the results and meaning are presented to the following committees/subcommittees:
SWG and Study Requestor(s)
TAS
TEPPC
Results and Trends of All Findings; year-end report

23. SPSG Work Plan
2016
Finalize inputs for Scenarios, run, and report
Finalize inputs for 20-year study cases, run, and report
Develop study cases for 2017 Open Season (Jan-Feb 2017)
November: SPSG approval item, 2017 Study Cases
2017
SPSG review and recommend 2017 study case prioritization
February: SPSG approval item, Next Reference Case (2036/2037)
Review and approve study/scenario metrics as Reference Case, Scenarios, and Studies are developed

24. Questions Gerald Harris: 415-350-1531 Richard Marrs: 925-420-654522
Questions
Gerald Harris: Richard Marrs:
Quantum Planning Group
San Francisco, CA
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