1. 1 Portfolio Analysis Mike Hopkins Senior Manager, Price Risk & Resource Planning

2. 2 What is Portfolio Analysis? Evaluation of different groupings of demand-side and supply-side resources to meet load forecast Considers both energy and capacity requirements Enables assessment of tradeoffs between different portfolios How do the different portfolios perform under changing conditions? Enables selection of preferred portfolio to meet the objectives FBC directed to do portfolio analysis in BCUC acceptance of 2012 LTRP

3. Portfolio Analysis Process 1. Load-Resource Balance Energy Gaps Capacity Gaps 2. Develop Feasible Resource Options 4a. Develop Base Portfolio 4b. Develop Alternative Portfolios 5. Evaluate Portfolios 6. Preferred Portfolio 3. Identify Uncertainties & Risks (Load, DSM, Market, Resources) 2

4. 4 Portfolio Analysis Consideration of Resource attributes: Technical Financial Environmental Social/Economic

5. 5 Portfolio Analysis – Base Portfolio Assumptions of the base portfolio: Base case load forecast (before DSM & Other Savings) Base case DSM & Other Savings Current carbon tax Mid electricity price Mid gas price Continued access to market purchases 93% clean or renewable resources

6. 6 Portfolio Analysis – Alternative Portfolios Possible alternative portfolios: 100% market reliance Self-sufficiency (no market supply) 100% clean or renewable resources No 93% clean or renewable requirement Flexible termination of BCH PPA More aggressive DSM More conservative DSM

7. 7 Portfolio Analysis Criteria to evaluate portfolios: 1. Economics (cost, rate impacts) 2. Self-sufficiency 3. Environment (e.g. GHG emissions) 4. Clean or renewable 5. Resource adequacy (LOLE target) Portfolio evaluation: Score or ranking Sensitivity analysis: e.g. high/low electricity/gas/carbon prices Contingency analysis on the preferred portfolio: e.g. high/low gaps

8. 8 Questions?