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Michael I. Henderson ISO New England Inc.

NERC’s 2007-2016 Long-Term Reliability Assessment (LTRA) Workshop: Natural Gas Dependency in New England. Michael I. Henderson ISO New England Inc. New England’s Electric Power Grid. ISO and Local Control Centers. 6.5 million customer meters Population: 14 million 350+ generators

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Michael I. Henderson ISO New England Inc.

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  1. NERC’s 2007-2016 Long-TermReliability Assessment (LTRA) Workshop:Natural Gas Dependency in New England Michael I. Henderson ISO New England Inc.

  2. New England’s Electric Power Grid ISO and Local Control Centers • 6.5 million customer meters • Population: 14 million • 350+ generators • 8,000+ miles of high voltage transmission lines • 12 interconnections to three neighboring systems: • New York, New Brunswick, Quebec • 31,000 megawatts (MW) of installed generating capacity • 300+ market participants • Summer peaking system • Summer: 28,130 MW (8/06) • Winter: 22,818 MW (1/04) Natural Gas Dependency In New England

  3. New England’s Capacity – Summer 2007 Generation capacity mix by primary fuel type, 2007, summer ratings, MW and percentage. Note: “Non-Hydro Renewables” include biomass, refuse, landfill gas, and wind. Natural Gas Dependency In New England

  4. New England’s Energy Production - 2006 New England electric energy production by fuel type, 2006, in 1,000 MWh. Note: “Non-Hydro Renewables” include biomass, refuse, landfill gas, and wind. Natural Gas Dependency In New England

  5. New England’s Gas-Fired Fleet • Potential Concerns: • “Just-in-time” delivery of fuel source • Unplanned outage or closure of the regional LNG facility • LNG shipping disruption or embargo • Loss of natural gas pipeline or compressor stations • Wholesale electricity’s exposure to natural gas price volatility • Actual Experience: • Temporary shutdown of regional LNG facility – Post 9/11 • Greater Northeast Cold Snap – January 14-16, 2004 • Hurricanes Katrina & Rita - Fall of 2005 Natural Gas Dependency In New England

  6. Regional Response • Developed robust rules and operating procedures to manage the electric system through short or long-term fuel supply or delivery constraints: • Appendix H of Market Rule #1: “Operations During Cold Weather Conditions.” • Operating Procedure No. 21: “Action During an Energy Emergency.” • Added provisions in new markets to promote resource availability at time of need: • Forward Capacity Market (FCM) • Locational Forward Reserve Market (LFRM) • Created the Electric/Gas Operations Committee (EGOC) • Increased communications and coordination with the regional natural gas sector via the Northeast Gas Association (NGA) Natural Gas Dependency In New England

  7. Regional Response – cont’d • Dual fuel conversions of single-fuel, gas-only power stations • Newly proposed LNG terminals and expansion of regional natural gas grid • Confirm existing practices are compliant with FERC Order 698: (electric & gas sector communications) Natural Gas Dependency In New England

  8. Inter-Regional Response • 3 ISO/RTO MOU on Natural Gas: • Transfer of knowledge between ISO-NE, NYISO & PJM • Coordinated operations & planning • Continuous pre & post-seasonal discussions • Sharing of information, studies & methodologies • Refinement of communications protocols and contact lists • Direct communications between Control Room and Gas Control • Table-Top exercises Natural Gas Dependency In New England

  9. Long-Term Outlook • ISO-NE Regional System Plan: • Annual 10-year plan • Loads, generation, transmission & demand-side • Fuel diversity, availability, deliverability • ISO-NE’s Scenario Analysis: • New England will continue to depend on natural gas • Interconnection queue predominately gas-fired • Relatively low air emissions • Renewable Portfolio Standards (RPS) Natural Gas Dependency In New England

  10. Long-Term Outlook – cont’d • NERC LTRA • Resource adequacy assessment • Fuel supply & delivery assessment • NPCC Triennial Review of Resource Adequacy • 5-year resource adequacy review (LOLE) • Comprehensive review every three years • Interim review every year • Emerging Issue: • LNG Interchangeability Natural Gas Dependency In New England

  11. Operable Capacity Analysis • New England’s total installed capacity: 33,425 MW (winter) • 16,733 MW (50%) are capable of burning natural gas (as either a startup, primary, secondary or stabilization fuel) • 8,587 MW (26%) are single-fuel, gas-only stations • 8,146 MW (24%) are fully functional, dual-fuel stations (gas/oil) • 2007 Regional System Plan – Assessed the amount of gas-only resources required under winter peak conditions: • 50/50 load: • 2007/08 ~ 450 MW • 2011/12 ~ 1,650 MW • 90/10 load: • 2007/08 ~ 1,400 MW • 2011/12 ~ 2,700 MW Natural Gas Dependency In New England

  12. Market Rules and Operating Procedures • Appendix H of Market Rule #1: “Operations During Cold Weather Conditions” • 7-Day Forecast Projects Cold Weather Conditions • Cold Weather Watch, Warning & Event • Cold Weather Event triggers rollback of wholesale electric market timelines to align with natural gas nomination deadlines • Operating Procedure No. 21: “Action During an Energy Emergency” • Triggered by fuel supply shortage or deliverability constraint • Requests fuel switching to non-constrained fuels • Allows collection of fuel inventory data from generation fleet • Dispatch system to manage and preserve fuel inventories Natural Gas Dependency In New England

  13. New Natural Gas Infrastructure Source: Northeast Gas Association (NGA) Natural Gas Dependency In New England

  14. New Natural Gas Infrastructure Source: Northeast Gas Association (NGA) Natural Gas Dependency In New England

  15. Conclusions • New England will continue to rely heavily on natural gas-fired generation (primary finding from ISO-NE’s Scenario Analysis) • Close coordination between electric and gas industries is required • Markets promote unit availability at time of need • Dual fuel & firm fuel purchases • Renewable Portfolio Standards (RPS) and demand-side resources will assist in diversifying the region’s fuel supply • Newly proposed LNG terminals and expansion of the regional natural gas grid will improve the amount of natural gas supply Natural Gas Dependency In New England

  16. Appendix • 2007 Regional System Plan: • http://www.iso-ne.com/trans/rsp/index.html • ISO-NE’s Scenario Analysis: • http://www.iso-ne.com/committees/comm_wkgrps/othr/sas/index.html • NERC LTRA • http://www.nerc.com/~filez/rasreports.html • NPCC Triennial Review of Resource Adequacy: • http://www.npcc.org/adequacy.cfm Natural Gas Dependency In New England

  17. Appendix – cont’d • Appendix H of Market Rule #1: Cold Weather Operations • http://www.iso-ne.com/regulatory/tariff/sect_3/mr1_appendix_h_11-27-06.pdf • Operating Procedure No. 21: Action During an Energy Emergency • http://www.iso-ne.com/rules_proceds/operating/isone/op21/index.html • Northeast Gas Association: • http://www.northeastgas.org Natural Gas Dependency In New England

  18. QUESTIONS Michael I. Henderson Director – Regional Planning and Coordination ISO New England Inc. (413) 535 – 4166 mhenderson@iso-ne.com Natural Gas Dependency In New England

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