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Studies and Reports > 2013 MN Biennial Report >Transmission Planning Zones


Transmission Projects Report 2013
Chapter 8: Renewable Energy Standards
   

8.0 Renewable Energy Standards

           8.1    Introduction

Minnesota Statutes § 216B.2425, subd. 7, states that in the Biennial Report the utilities shall address necessary transmission upgrades to support development of renewable energy resources required to meet upcoming Renewable Energy Standard milestones. In its May 30, 2008, Order approving the 2007 Biennial Report and Renewable Energy Standards Report, the Commission said, "Future biennial transmission projects reports shall incorporate and address transmission issues related to meeting the standards and milestones of the new renewable energy standards enacted at Minn. Laws 2007, ch. 3."

In this Report, as in past years, the utilities are reporting on their best estimates for how much renewable generation will be required in future years and what efforts are underway to ensure that adequate transmission will be available to transmit that energy to the necessary market areas. A Gap Analysis is provided to illustrate the amount of renewable generation that is already available and how much will be required in the future to meet the standard.

8.2 Reporting Utilities

It should be pointed out, as was done in previous reports, that the utilities that are required to submit the Biennial Transmission Projects Report are not identical to those that are required to meet the Renewable Energy Standards. The information in this chapter reflects the work of all the utilities that are required to meet RES milestones, regardless of whether they own transmission lines and are required to participate in the Biennial Report. A list of those utilities participating in the Biennial Transmission Projects Report can be found in Chapter 2.0. The utilities participating in this part of the 2013 Biennial Report on renewable energy are the following.

Investor-owned Utilities

Interstate Power and Light Company
Minnesota Power
Northern States Power Company
Otter Tail Power Company

Generation and Transmission Cooperative Electric Associations

Basin Electric Power Cooperative
Dairyland Power Cooperative
East River Electric Power Cooperative
Great River Energy
L&O Power Cooperative
Minnkota Power Cooperative

Municipal Power Agencies

Central Minnesota Municipal Power Agency
Minnesota Municipal Power Agency
Southern Minnesota Municipal Power Agency
Western Minnesota Municipal Power Agency/Missouri River Energy Services

Power District

Heartland Consumers Power District

8.3 Compliance Summary

The utilities have continued to make substantial progress with respect to meeting future RES milestones. The present analysis shows that the utilities are on course to meet the RES milestone for 2016. There is no statutory milestone for 2014 but the utilities have included figures for 2014 to provide the most recent base year, consistent with past reports. The analysis continues to show that the CapX2020 Group 1 projects are crucial to meeting the 2016 Minnesota RES and non-Minnesota RES milestones. The utilities recognize that additional transmission and generation will be necessary for 2020 and beyond in Minnesota, and that other demands for renewable energy will impact Minnesota's compliance status.

8.4 Gap Analysis

A Gap Analysis is an estimate of how many more megawatts of renewable generating capacity a utility expects to need beyond what is presently available to obtain the required amount of renewable energy that must come from renewable sources at a particular time in the future. A Gap Analysis is not an exercise intended to verify the validity of forecasted energy sales and associated capacity needs. It is done for transmission planning purposes only. This is the fourth time the utilities have prepared a Gap Analysis; a Gap Analysis was prepared for the 2007, 2009 and 2011 Biennial Reports also.

8.5 Base Capacity and RES/REO Forecast

The chart below presents a system-wide overview of existing capacity in 2014 (used as a base figure throughout the various milestone periods) and forecasted renewable capacity requirements to meet Minnesota RES as well as non-Minnesota RES/REO needs. Each utility provided its own forecast of Minnesota RES and non-Minnesota RES/REO renewable energy needs, and converted such estimates into capacity based on their own mix of renewable resources (wind, biomass, hydropower) using the most appropriate capacity factors unique to their specific generating resources.

Table 1 on the following page shows a more specific breakdown of each utility's Minnesota RES and non-Minnesota RES/REO needed capacity forecast.

Renewable Energy MW Gap Analysis – MN RES Utilities
2014 Base and RES Forecast  

2014 MTO MW Base: RES capacity acquired, actually installed and operational ("in the ground and running") regardless of geographic location. Does not include projects under contract but not yet under construction, and it does not include projects under construction but not yet completed.

Needed MW MN RES: Renewable capacity required to meet the RES energy goals for each utility serving customers in Minnesota.

Needed MW Other Jurisdictions: Gross non-MN renewable capacity required to meet RES requirements or REO goals in states served by the reporting utility other than Minnesota.

Table 1. MN & Non-MN RES Need Forecast (MW)1

Utility

2014

2016

2020

2025

MN RES

Non-MN RES

MN RES

Non-MN RES

MN RES

Non-MN RES

MN RES

Non-MN RES

Basin Electric2

38.9

16.3

59.4

363.3

81.4

438.4

121.2

491.3

CMMPA

14.0

-

20.0

-

27.0

-

39.0

-

Dairyland

22.2

31.9

32.3

60.6

39.8

63.7

52.9

67.7

GRE

351.0

0.4

518.0

1.5

617.0

1.5

827.0

1.5

Heartland

15.4

-

12.7

5.5

3.9

5.7

5.0

6.0

IPL

33.4

49.8

48.1

49.8

59.0

49.8

77.4

49.8

Minnkota

58.0

-

85.0

93.0

107.0

100.0

147.0

109.0

MMPA

48.5

-

68.9

-

98.5

-

127.6

-

MN Power

419.0

9.6

579.4

17.3

696.3

-

826.9

-

Otter Tail

72.0

-

120.7

67.8

158.1

71.3

196.6

75.8

SMMPA

109.5

-

161.1

-

201.6

-

269.1

-

WMMPA/MRES

44.0

33.0

75.0

39.0

107.0

42.0

140.0

45.0

Xcel Energy

1,614.7

169.8

2,315.0

385.5

2,862.4

405.7

2,919.5

423.7

TOTAL

2,840.5

310.8

4,095.5

1,083.4

5,058.9

1,178.1

5,749.2

1,269.8

Note:
1. Capacity factor assumptions established by each utility
2. These quantities include Basin Electric Power Cooperative, L&O Power Cooperative, and East River Electric Power Cooperative

 

8.5.1 Capacity Acquisitions & Expirations

This chart presents a system-wide overview of additional renewable capacity that will be acquired by individual utilities beginning as early as 2014 and capacity that will expire between 2016 and 2025. Such losses are attributable primarily to the expiration of various power purchase agreements for renewable energy generation.

Renewable Generation Gap Analysis – MN RES Utilities
Capacity Additions & Losses (Net) to 2014 RES Base Line

 

8.5.2 RES Capacity Acquired and Net RES/REO Need

Renewable Generation Gap Analysis – MN RES Utilities
Acquired Capacity and MW Needed for RES Compliance

This chart represents the total renewable capacity system-wide that will be acquired and lost between 2014 and 2025, as well as the total Minnesota RES and non-Minnesota RES/REO needs between 2014 and 2025.


As can be seen, the Minnesota RES utilities have sufficient capacity acquired to meet the Minnesota RES needs through 2025. When considering the RES needs, including other jurisdictions outside of Minnesota, the Minnesota RES utilities have enough capacity to meet RES needs beyond 2020. In addition, some utilities with less than sufficient capacity to meet the Minnesota RES need may use renewable energy credits to fulfill their requirement.

Focusing back on just Minnesota RES needs, Table 2 below provides a more specific breakdown of each utility's forecast.

Table 2. RES Capacity Acquired & Net MN RES Capacity Need (MW)1

Utility

2014

2016

2020

2025

RES Cap Acq.

MN RES Net

RES Cap Acq.

MN RES Net

RES Cap Acq.

MN RES Net

RES Cap Acq.

MN RES Net

Basin Electric 2

738.3

-

738.3

-

738.3

-

731.0

-

CMMPA

33.6

-

33.6

-

33.6

-

27.6

11.4

Dairyland

125.9

-

125.9

-

125.9

-

125.9

-

GRE

508.0

-

506.0

-

491.0

-

488.0

-

Heartland

34.0

-

32.0

-

30.0

-

30.0

-

IPL

25.2

(8.2)

25.1

(23.0)

23.5

(35.5)

21.5

(56.0)

Minnkota

359.0

(303.0)

359.0

(274.0)

359.0

(252.0)

359.0

(212.0)

MMPA

246.6

-

263.3

-

164.8

-

51.4

76.3

MN Power

650.8

-

844.2

-

832.8

-

832.8

-

Otter Tail

196.6

-

259.0

-

259.0

-

259.0

-

SMMPA

119.3

-

119.3

41.8

119.3

82.3

119.3

149.8

WMMPA/MRES

85.3

(41.3)

85.3

(10.3)

121.4

(14.4)

121.4

18.4

Xcel Energy

2,338.5

-

3,318.0

-

3,142.3

125.8

2,750.4

592.8

TOTAL3

5,461.1

(352.5)

6,708.9

(265.5)

6,440.8

(93.8)

5,917.2

580.6

Note:
1. Capacity factor assumptions established by each utility
2. These quantities include Basin Electric Power Cooperative, L&O Power Cooperative, and East River Electric Power Cooperative
3. Some Utilities with less than sufficient capacity to meet the MN RES need may use renewable energy credits to fulfill their requirement.

Note that the "Needed MW MN RES" bar in the bar chart in this section represents the total level of RES need in Minnesota. Conversely, the column in Table 2 that is labeled "MN RES Net" represents the additional RES capacity that is presently identified to meet RES need (a negative value means the utility has a surplus of RES capacity). The shortfall, or "gap", between MN RES need and the additional RES capacity identified points to the need for some utilities to seek additional renewable capacity and when they need to do so. Alternatively, some utilities may use renewable energy credits to fulfill their RES requirements.

8.6 Solar Energy Standard

In 2013, the Minnesota Legislature established a separate solar standard for public utilities, effective by the end of 2020. Minn. Laws 2013, Ch. 85, § 3, codified at Minnesota Statutes § 216B.1691, subd. 2f (Solar energy standard). That statute requires public utilities subject to the solar standard to report to the Public Utilities Commission on July 1, 2014, and each July thereafter, on progress in achieving the standard. While this legislation is new and the Commission has not required information on compliance with it to be included in the Biennial Report, Northern States Power Company has included a brief analysis of its anticipated needs for solar energy in future years as part of this report.

Table 3 below provides the level of solar capacity Northern States Power Company forecasts will be needed by the indicated years. When this is combined with the needs for the RES requirements, the Total shown provides the total level of renewable resources Northern States Power Company needs.

Table 3. Northern States Power MN & Non-MN RES and SES* Forecast (MW)

2014

2016

2020

2025

MN

Non-MN

MN

Non-MN

MN

Non-MN

MN

Non-MN

RES

1,615.0

170.0

2,315.0

386.0

2,862.0

406.0

2,920.0

424.0

SES

-

269.0

274.0

TOTAL

1,615.0

170.0

2,315.0

386.0

3,131.0

406.0

3,194.0

424.0

* SES is the new MN Solar Energy Standard which will require additional solar on the NSP system beyond the MN RES Requirements


Table 4 below Provides Northern States Power Company's planned level of solar capacity additions. Once again when this is combined with the planned additions for the RES requirements, the Total shown provides the total level of renewable resources Northern States Power Company plans on acquiring by the listed years.

Table 4. NSP RES & SES* Capacity Acquired & Net MN Capacity Need (MW)

2014

2016

2020

2025

Cap Acq.

MN Net

Cap Acq.

MN Net

Cap Acq.

MN Net

Cap Acq.

MN Net

RES

2,338.5

-

3,318.0

-

3,142.3

125.8

2,750.4

592.8

SES

-

-

85.0

-

275.6

-

275.6

-

TOTAL

2,338.5

-

3,403.0

-

3,417.9

125.8

3,026.0

592.8

* SES is the new MN Solar Energy Standard which will require additional solar on the NSP system beyond the MN RES requirements.

 

8.7 Corridor Upgrade Project

The 2011 Biennial Report included a report on the Corridor Upgrade Project, in response to the Commission's Order of May 28, 2010, approving the 2009 Biennial Report, to include such a report in the 2011 Report.

The Corridor Upgrade Project is an upgrade of the 230 kV line between the Hazel Creek Substation near Granite Falls, Minnesota, and the Blue Lake Substation in Shakopee, Minnesota to a double circuit 345 kV system. This upgrade would provide significant new transmission capacity from the Dakotas, southwestern Minnesota and western Minnesota to the Twin Cities, at a cost estimated in 2009 to be approximately $350 million.

As reported in the 2011 Biennial Report, the Corridor Upgrade Project was initially expected to be needed in the 2016-2018 timeframe based on constructability and ability to take transmission system outages as the generation delivery from SW Minnesota increased, and was expected to be the next transmission project pursued after the CapX2020 Group 1 lines. However, because of the addition of the MISO MVP Group 1 portfolio of projects, which was approved by the MISO Board of Directors in December 2011, the timeframe for the Corridor Upgrade Project was pushed out beyond 2018.

In its May 18, 2012, Order approving the 2011 Biennial Report, the Commission again directed the utilities to include an update on the Corridor Upgrade Project. That status of the Corridor Upgrade Project has not changed. This Project is likely to not be required until well beyond 2018.