1. 1 Market Price Forecasts and PPA Rate Scenarios Tony Liu Price Risk Analyst

2. 2 Price Forecasts and PPA Rate Scenarios Required to determine resource options costs, including electricity market purchases and BCH PPA Provide range of prices to assess portfolios in scenario analysis Includes: - Sumas natural gas price forecast - Mid-C electricity price forecast - Carbon price forecasts for BC and US - BCH PPA rate scenarios Forecasts and scenarios presented in real $2015 Need to adjust forecast prices for other adders (e.g. transportation costs, line losses) before portfolio analysis

3. 3 Gas Market Price Forecasts

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5. 5 Electricity Market Price Forecasts

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7. 7 B.C. Carbon Price Forecasts The carbon tax started in 2008 at $10/tonne and increased to $30/tonne by 2012. B.C. has committed to keep the rate at $30/tonne until 2018.

8. 8 U.S. PNW Carbon Price Forecasts BCH’s low, mid, high regional GHG forecasts, NPCC’s base forecast, and PSE’s low forecast all have zero carbon price until 2035.

9. 9 BC Hydro PPA Rate Scenarios

10. 10 Next Steps Monitor market and policy developments and any price forecast updates by fall 2015 Determine our base price forecasts and rate scenarios by end of 2015 - Develop HLH and LLH Mid-C price forecasts - Include transportation/transmission costs, losses - Translate prices to Canadian dollar units - Develop market capacity price curves Update resource options costs Incorporate market prices to cost of new resources in portfolio analysis

11. 11 Questions?