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Iowa State Presentation July 15, 2011. What We Plan to Discuss. MidAmerican Energy Company Energy Supply Management Our typical market day MEC’s generation portfolio Reliability responsibilities Wind variability and its impact MISO resource adequacy planning Locational Marginal Prices
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Iowa State Presentation July 15, 2011
What We Plan to Discuss • MidAmerican Energy Company • Energy Supply Management • Our typical market day • MEC’s generation portfolio • Reliability responsibilities • Wind variability and its impact • MISO resource adequacy planning • Locational Marginal Prices • Fossil unit operations • Wind forecasting
MidAmerican Energy Company • MidAmerican Energy Holdings Company is a owned primarily by Berkshire Hathaway • Three predecessor utilities • Iowa Power and Light Company – Des Moines • Iowa Illinois Gas and Electric – Davenport • Iowa Public Service Company – Sioux City • 723,000 electric customers • 702,000 gas customers • 10,600 square miles from South Dakota to Quad Cities • Communities of Des Moines, Cedar Rapids, Sioux City, Waterloo, Iowa City, Sioux Falls and Council Bluffs
MidAmerican Energy Supply Management • Trading and Market Operations • Manage generation dispatch • Manage FTR hedge strategy • Forecast load and supply • Manage gas supply for generation • Manage submission of bids and offers to MISO • RT Liaison to MISO RGD and generation plants
MidAmerican Energy Supply Management • Fuel Supply (coal and oil) • Manage generation fossil fuel procurement contracts • Manage fuel transportation contacts – Unit Trains • Emissions allowance trading • Monitor coal quality • Marketing and Trading Support (back office) • Energy accounting • MISO settlements review and approval • Support for general accounting • Joint owned generation accounting • FERC reporting
Our Typical Market Day 0630 DA staff begins OD+1 preparation • Update gas/oil fuel prices and supply requirements • Hourly load forecast • Hourly wind forecast • 0800 -0815 morning operations call • GMs plant reports of RT and DA activities • Review limits, ramp rates, testing, de-rates, and scheduled Outages • Review market prices and expected load demand • Review gas supply requirements for coal units
Our Typical Market Day • 0815 -1030 adjust OD+1 offers and bids • Adjust unit limits, prices, dispatch status, ramp rates • Review wind forecast (using latest weather forecast) • 0900 PCI import and initialize demand bid packages (3 Days) • 0930 PCI import wind forecast • Finalize gas supply requirements (coal, CT’s and CCCT) • 1030 – 1045 Submit DA bids and offers • 1130 PCI - Download submitted DA data OD+1 • 1530 PCI - Download physical schedules and DA results • 1550 PCI - Download day ahead LMP (for settlements and P&L Analyzer)
Settlements Team Activities • 0800 Start review of settlements runs • Settlements team review • Analyze pre-settlement and review shadow for discrepancies • Verify data integrity (data check dashboard) • Modify data as required • Rerun pre-settlement and shadows as required • Resend settlements results to P&L as required • Settlements Results • Ensures accurate management reporting • Ensures MDMA data submittal accuracy • Ensures accurate shadow for invoice payment
Market Participation Then and Now • Pre-MISO Integration (Balancing Area Authority) • Provided agency services for BAA • NERC compliance with BAL-001 through BAL-004 • Significant bilateral transaction activity • Participant in MISO CRSG • DSM trigger – MAPP Reserve Sharing Pool • Post-MISO Integration • Significant reduction in agency services For LBA • No BAL-001 through BAL-004 responsibilities • Significant drop in bilateral transactions • Participation in MISO ASM • Increased cost knowledge
Generation Portfolio • 7,200 MW of Generation Capability • 50% coal • 21% natural gas • 10% nuclear • 19% wind, hydro and biomass (1,348 MW of wind) • 1% by other non-renewable sources • Peak native load demand – 4,515 MW • MISO participation – load and generation • Announced membership plans to join – June 2009 • First day of operations – September 1, 2009
MidAmerican Wind Farms • Storm Lake 1 108 MW PPA • Intrepid 175 MW • Century 200 MW • Victory 99 MW • Carroll 150 MW • Charles City 75 MW • Pomeroy 257 MW • Adair 175 MW • Walnut 153 MW Total installed 1,392 MW
MidAmerican Wind Farm Expansions • Pomeroy • 13 Siemens 2.3 MW turbines • Nameplate capacity 30 MW • MISO commercially operational ~ July 31, 2011 • Rolling Hills • 193 Siemens 2.3 MW turbines • Nameplate capacity 443 MW • MISO commercially operational ~ December 15, 2011 • Laurel • 52 Siemens 2.3 MW turbines • Nameplate capacity 120 MW • MISO commercially operational ~ January 15, 2012
Total MidAmerican Wind Capacity • Current capacity 1,392 MW • Expansion capacity 593 MW • Total capacity 1,977 MW • Percent of total capacity 26% • MEC is #1 in the Nation in ownership of wind generation among rate-regulated utilities in operation or under contract.
Dispatchable Intermittent Resources (DIR) • Capable of control to MISO setpoint. • All location but one have this capability • Two farms currently registered as DIR • Dispatch is accomplished by: • Sending to MISO 5-minute max DIR output forecast • MISO generates Unit Dispatch Solution (UDS) for DIR as well as fossil units • Receive from MISO 5-minute DIR dispatch setpoint • MISO UDS>GMS>RTU>Wind Farm Controller
DIR 5-MIN Max Forecast • Forecast • Runs every minute ( in-house developed .NET application) • Combination forecast • Persistence • Unit availability • Wind speed • Output curves • Designed to maximize park output when not being curtailed • Data transfer via API to market interface software • Transmission of forecast to MISO • Shadow settlement calculation • Analysis
Benefits of DIR for MISO Operations • Improved knowledge of real-time capability • More economically dispatched congestion relief • Potential for fewer and smaller swings in prices • Future regulation potential • Requires accurate 5-minute max output forecasts • Requires market incentives through lost opportunity payments • During minimum generation situations • Eliminates need for manual curtailments for reliability
Wind Generation Forecasting • Current levels of forecasting (in)accuracy are often cited as a key barrier to significant expansion of wind generation • Forecasting error by the system operator could have severe reliability impacts; wind asset owners’ forecasting error can have severe economic impacts (for the owner) • Offering generation in the day-ahead market that may or may not materialize in the real-time market exposes the company to price risk • Penalties are charged for production above/below day-ahead forecast levels • If MidAmerican drastically under-forecasts wind output, other generation might be committed such that curtailment of wind generation is required when unexpected winds arrives in real-time and oversupplies the system • Under the DIR classification, failure to generate the amount forecasted for the following five-minutes will result in additional penalties
MidAmerican Wind Forecast Methodology • MidAmerican’s focus areas for improvement include forecast combination, bias correction and power curve modeling • Industry as a whole paying increased attention to use of observations for short-term forecasting; holds promise for the industry as a whole, but value for ISO members less clear Typical Industry Vendor Method 3rd Party Mesoscale Model(s) Vendor Ensemble Methodology Advanced Power Curve Model MidAmerican Model NWS Weather Data 3rd Party Mesoscale Models MEC Ensemble Methodology Advanced Power Curve Model 3rd Party Proprietary Sensor Data NWS Weather Data & Models Focus of continued development Canadian Weather Data & Models European Weather Data & Models
Wind Generation Forecast Error Analysis • Wind speed forecast error is the largest contributor to power forecast error, but other factors can also play a significant role. • Curtailments – wind speed errors at high speeds do not affect accuracy, but curtailment often occurs when the forecast was for high output, so when it happens, the error is often a significant percentage of capacity. • Availability – usually less important, but under some conditions (icing, extreme cold), winds might be high as predicted, but farm output becomes impaired significantly or totally • Power Curve – possibly a driver of error in certain instances, but difficult to measure with confidence
MidAmerican Energy Company’s Wind-Powered Electric Generation Iowa State Presentation July 15, 2011
MidAmerican Energy Company’s Wind-Powered Electric Generation Iowa State Presentation July 15, 2011
Topics Iowa Wind Power Review MEC Wind Project Background General System and Component Review Issues Moving Forward
Iowa Wind Power Review MidAmerican Energy owns and operates more wind-powered electric generation than any other rate-regulated utility in the nation (1,284.3MW) Iowa is the 10th ranked state in the nation in terms of available wind resources However, because of a progressive legislative and regulatory environment, Iowa ranks 2nd in actual wind generation capacity and first in percentage of total generation.
Wind Power Background Wind Resource Largest area of risk Need at least one year of on-site data that correlates well to local long-term weather service meteorological towers Site diversification mitigates wind resource risk Site diversification also allows for more effective energy dispatch
Wind Power Background Land Issues Landowner relationships are extremely important Wind project landowner relationships are not the same as normal utility transmission line relationships. Must get buy-in…eminent domain will not work. Wind - 20+ year project with continuous O&M. Transmission – Build and don’t have significant long term interface with landowners.
Wind Power Background Transmission capacity must be available Significant development and timing risk In total MidAmerican will have spent nearly $50m in transmission upgrades to allow our projects to delivery power
Normal Substation Configuration Two 161 kV transmission lines Two 161- 34.5 kV, 72/96/120 MVA transformers Power Distribution Center 38 kV switchgear Relay Panels, SCADA, & DFR HVAC, HS & Station Battery Turbine SCADA and control system
Special Features Special Protection Schemes (Auto curtailment) Adjacent system overloads are a concern if certain line segments are lost Manual Curtailment via SCADA EMS can control generation via analog set point SCADA control Generation Following Scheme One project can track a percentage of another SCADA set point control from EMS used
Special Features Voltage/VAR Controls Turbines dynamically controlled Regulate 161 kV Bus Voltage or Regulate VARs in or out of 161 kV System Voltage control is very effective (when wind blowing)
