1. Overview of the Grid Randy Manion, Western Area Power Admin. EPA Clean Power Plan Workshops Farmington, NM, December 7 and 8, 2015 Tuba City, AZ, December 9 and 10, 2015

2. Presentation Goals Overview of Western Area Power Administration Fundamentals of Electricity Overview of the Grid Overview of Electricity Markets Useful Tools and Resources Questions and Answers

3. Western’s Service Area Western marketing areas and offices 3

4. Wholesale Power Services Markets 10,479 MW from 57 Federal hydropower projects owned by BOR, Corps, and IB&WC 17,100 miles of high-voltage transmission line across 15 states 4

5. Bulk Wholesale Transmission 17,060 miles of high-voltage transmission lines in 11 states Bulk, wholesale transmission

6. How is Electricity Created Source: SolarSchools.net

7. What is Current and Voltage Source: SolarSchools.net

8. AC Power Generation System

9. Electricity is Unique Is generated and consumed at nearly the same time Storage has been impractical on a broad scale although that’s beginning to change Requires an extensive delivery infrastructure (grid)

10. Balancing Generation and Load Maintaining a reliable grid requires a constant balancing between generation (supply) and load (demand)

11. How is Electricity Measured? Electricity is measured in terms of watts, typically in kilowatts (1,000 watts) or megawatts (1,000 kilowatts). One MW is enough capacity to instantaneously light approximately 750 – 1000 homes. A kilowatt (or megawatt) is the amount of energy used, generated or transmitted at a point in time. The aggregation of megawatts possible at a point in time for a power plant, for example, is its capacity. The aggregation of kilowatts used at a point of time is the demand at that point. One kilowatt of energy consumed over an hour is called a kilowatt-hour (or kWh). Meters measure the kWh usage over a month. Billing rates are established as ¢/kWh. One megawatt generated, delivered, or consumed over an hour at the wholesale level is called a megawatt-hour (or MWh). Wholesale transactions are priced at $/MWh.

12. Electricity Transmission System 12 Source: http://www.osha.gov/SLTC/etools/electric_power/illustrated_glossary/transmission_lines.htmlhttp://www.osha.gov/SLTC/etools/electric_power/illustrated_glossary/transmission_lines.html 345 kV 230 kV Transmission Voltage Levels Transmission 230 kilovolt (kV) 345 kV 500 kV 765 kV 1,000 kV and above Sub-transmission 69 kV 115 kV 138 kV 69 kV

13. U.S. Power Generation Mix

14. Power Generation in the West Generation in the Western U.S. AK, AZ, CA, CO, HI, ID, MT, NM, NV, OR, UT, WA, WY United States Generation Mix Source: ACORE Source: U.S. Department of Energy

15. Power Generation in New Mexico New Mexico Generation MixUnited States Generation Mix Source: ACORE Source: U.S. Department of Energy

16. Power Generation in Arizona Arizona Generation MixUnited States Generation Mix Source: ACORE Source: U.S. Department of Energy

17. Transmission and the Grid Source: ACORE

18. US Interconnections

19. Sending Power to the Grid

20. Daily Demand Curve and Generation Mix

21. Generation Energy and Capacity

22. Step-Up Transformers

24. Transmission & Distribution Line

25. Substations and Transformers

26. Transformers

27. Who regulates use of the grid? Federal Energy Regulatory Commission (FERC) – Regulates the transmission and wholesale sale of electricity. Monitors energy markets. North American Electric Reliability Corporation (NERC) – Establishes reliability standards that grid operators must adhere to. Regional Reliability Organizations (RRO) - are the enforcement arm of NERC. They perform periodic audits of grid operators and can levy financial fines for non-compliance.

28. Regional Reliability Organizations

29. Who Regulates Use of the Grid? Utility commissions and districts regulate privately and publicly owned electricity providers – Utilities Commission – Utility Regulatory Commission – Public Utilities Commission – Public Service Commission (may be civil service oversight body rather than utility regulator) – Public Utility District (tribal, state, or government owned utility, consumer owned and operated, small investor owned) – Publicly owned utilities include cooperative and municipal utilities – Cooperative utilities are owned by the customers they serve (farmers and rural communities)

30. RTO’s in North America

31. Vertically Integrated Utility Model

32. Balancing Areas in the West

33. How Can I Move Energy Across the Grid? Each Transmission Provider has an Open Access Transmission Tariff (OATT) Anyone wanting to move energy across someone’s transmission system must make a Transmission Service Request (TSR) on the OASIS. FERC regulates all transmission tariffs to assure rates are just and reasonable and that everyone wanting to use the system is treated fairly and equitably. 33

34. What if I Want to Connect to the Grid? This is called “Interconnection” and depends on your Generator size. – Less than 20 MW is called Small Generator Interconnection Procedures (SGIP) – Greater than 20 MW is called Large Generator Interconnection Procedures (LGIP) – Load Serving Entity (LSE) Procedures for Net Metering (This assumes that you are not selling to an entity other than your LSE.) Interconnection also depends on your impact on the Network (aka. Grid). You cannot be denied but you will be told what it costs. 34

35. Reason Transmission Rates Differ Pancakes are different prices – Long lines can cost billions of Dollars – Lines through rough terrain cost more. – In a joint owned line the cost can vary based on what companies rights are being used. – Newer lines have not been “Paid Off” – Lines owned by Investor Owned Utilities must pay stockholders. FERC allows certain Return on Equity. – Development cost for a long line can be very large due to environmental processes, California is particularly difficult and National Environmental Policy Act (NEPA) plays when federal lands or entities are involved. 35

36. Information Resources North American Electric Reliability Corporation Electricity Supply & Demand Database, http://www.nerc.com/page.php?cid=4|38http://www.nerc.com/page.php?cid=4|38 Office of Indian Energy, NTER Course on Electricity Grid Basics, https://nwtp.nterlearning.org/nwtp/data/nwtp/lm_data/lm_6001/338/ objects/il_0_file_2189/DOE- IE_%20Foundational_Electricity_Grid_Basics.pdf https://nwtp.nterlearning.org/nwtp/data/nwtp/lm_data/lm_6001/338/ objects/il_0_file_2189/DOE- IE_%20Foundational_Electricity_Grid_Basics.pdf NREL 2014 Renewable Energy Data Book, http://www.nrel.gov/docs/fy16osti/64720.pdf http://www.nrel.gov/docs/fy16osti/64720.pdf DOE Office of Electricity, Electricity Transmission, A Primer, http://energy.gov/oe/downloads/electricity-transmission-primer http://energy.gov/oe/downloads/electricity-transmission-primer 36

37. Questions?? Randy Manion Renewable Resource Program Manager Western Area Power Administration 615 S. 43 rd Ave Phoenix, AZ 85005 Manion@wapa.gov Manion@wapa.gov (602) 605-2628