NPCC Summer 2016 Reliability Assessment Overview

Adequate Summer Electricity Supplies Projected

The comprehensive reliability assessment conducted by the Northeast Power Coordinating Council, Inc. (NPCC) projects that the Region (consisting of the six New England states, the State of New York, Ontario, Québec and the Canadian Maritime Provinces of New Brunswick and Nova Scotia) will have an adequate supply of electricity this summer, even during periods of extreme weather.

A wide range of assumptions were analyzed, including extreme weather conditions derived through over 40 years of experience, unexpected generating plant outages, transmission constraints between and within Regions, implementation of operating procedures and estimated impact of demand response programs.

The assessment considered severe system conditions that included the impact of: 1) extended unit maintenance; 2) reductions in demand-response programs; 3) reductions in the ability to import power from neighboring Regions; 4) transmission constraints; and, 5) extreme weather characterized by wide-spread and prolonged heat waves with high humidity and near-record temperatures.

Established operating procedures are available to maintain reliability and keep electricity supplies and demand in balance if severe system conditions and extreme weather occurs.

Summary of Key Findings

Approximately 3,615 MW of new capacity¹ has been installed since last summer which includes projects expected to be in service over the course of this summer period. No delays to the in-service dates of new generating capacity are anticipated. Considering the retirements, derating, and other adjustments, the resultant net change in NPCC generation (from 2015 summer through 2016 summer) is approximately 2,715 MW.

For New York City and throughout New York State, an adequate supply of electricity is forecast this summer. From the summer of 2015 through this summer, several changes to generation in New York have occurred. The mothballing of the Astoria gas turbines No. 8, 10 &11 (83 MW), Huntley Units 67 & 68 (218 MW each), Dunkirk Unit 2 (100 MW) and the retirement of Ravenswood Units 4-6 (64 MW) total 683 MW. Considering all changes and other capacity adjustments (518 MW), the resultant net change for New York generation (from summer 2015 through this summer) is -165 MW.

New England expects to have a sufficient supply of electricity this summer. From the summer of 2015 through this summer, 229 MW of new generating capacity (primarily wind) has been added to the New England system. There were no retirements reported for New England. Considering all changes and other capacity adjustments (-308 MW), the resultant net change for New England generation (from summer 2015 through this summer) is -79 MW.

Ontario is projected to have a sufficient supply of electricity this summer. From the summer of 2015 through this summer, capacity additions total 2,267 MW, consisting of wind generation (1,440 MW), solar (240 MW), hydro units (42 MW), biomass projects (208 MW), the Green Electron gas-fired power plant (298 MW) and other capacity adjustments (39 MW). Retirements reduce this total by - 53 MW. Considering all changes, the resultant net change for Ontario generation (from summer 2015 through this summer) is +2,214 MW.

Québec and the Canadian Maritime Provinces have more than an adequate supply of electricity forecast for the summer period. Both of these areas are winter peaking. Normal hydro conditions are expected for this summer.

Since the summer of 2015 and through this summer, Hydro-Québec Production has added the La Romaine-1 generator (270 MW), and 379 MW of wind generation. Considering all changes and other capacity adjustments (22 MW), the resultant net change for Quebec generation (from summer 2015 through this summer) is +671 MW.

Since the summer of 2015 and through this summer, the Maritimes will have added 47 MW of wind generation and 7 MW of biomass generation. Considering a small amount of Tidal projects (6 MW) and other capacity adjustments (15 MW), the net change to Maritimes generation (from summer 2015 through this summer) is +75 MW.

Projected NPCC Load

The non-coincident (sum of the individual NPCC area) forecast peak demand for NPCC during the summer of 2016 is 106,981 MW (May – September period).

More importantly, the coincident NPCC 2016 summer peak demand forecast of 106,390 MW is expected to occur during July. This forecast is 1,050 MW lower than last year’s forecast coincident NPCC peak demand of 107,440 MW. Several factors influence the load growth projection, including the economic outlook as well as the on-going effects of conservation measures, efficiency improvements, and demand response programs.

Nevertheless, ambient weather conditions remain the most important variable in forecasting peak demand during the summer months. Historically, the peak loads and temperatures between New England and New York have a high correlation due to the relative locations of their respective load centers. Depending upon the extent and duration of a summer weather system, there is some potential for the Ontario summer peak demand to be coincident with New England and New York.

New York

The forecast peak load for summer 2016 by the New York Independent System Operator (NYISO) is 33,360 MW, which is 207 MW lower than the summer 2015 forecast of 33,567 MW. The lower forecast is largely attributed to the projected impact of existing statewide energy efficiency programs and the growing impact of distributed “behind-the-meter” energy resources. These include retail photovoltaic, combined heat and power, anaerobic digester gas, fuel cells, and energy storage.

New England

The Independent System Operator of New England’s (ISO-NE’s) forecast summer 2016 peak demand is 26,704 MW, assuming historically-based expected summer peak weather conditions. The 2016 forecast of peak demand is 6 MW lower than the corresponding 2015 forecast of 26,710 MW; the forecast takes into account the demand reductions associated with energy efficiency, load management, passive demand response initiatives, distributed generation and forecasted “behind-the-meter” photovoltaic resources located on the distribution system.

Ontario

The 2016 summer peak Ontario demand forecast by the Ontario Independent Electricity System Operator (the IESO) for ‘weather normal’ conditions is 22,587 MW, and includes the reductions due to conservation measures, growth in embedded solar and wind generation, and pricing factors. The forecast is 404 MW lower that last summer’s forecast ‘weather normal’ peak demand of 22,991 MW. This is due to conservation, time-of-use rates and the Industrial Conservation Initiative (ICI) exerting downward pressure on peak summer demands. Also, the combined effects of conservation savings and distribution-connected generation are expected to offset any economic and population growth.

Québec

The forecast 2016 summer peak load for Québec is 20,724 MW for the week beginning August 14, 2016. The Québec 2016 forecast is 366 MW lower than the summer 2015 forecast of 21,090 MW (week of August 15, 2015). It should be noted, however, that Hydro-Québec’s system is winter peaking. Since some heating load remains on the system in early May and picks up again in late September, the summer peak for Québec may occur around those times.

Maritime Provinces

A 2016 summer peak load of 3,606 MW is forecast for the Maritime Provinces for the week of May 1, 2016. The Maritime Provinces are winter-peaking; forecast peaks for the shoulder months are normally higher than the summer period. The 2016 forecast peak is 142 MW lower than last year’s corresponding forecast summer peak of 3,748 MW (for the week of April 26, 2015).

Transmission and Resource Adequacy Summary

NPCC 2016 Summary

During the NPCC forecast coincident peak load week (beginning July 3rd), the overall spare operable capacity (capacity over and above reserve requirements) for NPCC is estimated to be 15,008 MW. A portion of this spare operable capacity is in the Québec and Maritime Provinces. The transfer capability between the Québec and the Maritimes Provinces to the remainder of NPCC will not permit the usage of all this forecast spare operable capacity. As a result, the spare operable capacity is reduced to 9,262 MW.

The week beginning June 5th represents the week with the lowest forecast operable capacity margin (spare operable capacity less transfer capability limitations); 8,373 MW is estimated to be available. This is not the same week as the forecasted NPCC coincident peak demand.

The sizeable forecast NPCC operable capacity margins will help to counteract any adverse reliability impacts that project delays could have on overall NPCC reliability this summer.

New York

The New York Independent System Operator (NYISO) forecasts installed capacity of 38,535 MW for the peak week demand forecast of 33,360 MW. Accounting for purchases, sales, required operating reserve, planned and unplanned outages results in an operable spare capacity margin of 872 MW for the peak week.

Supply-Side Resources

From the summer of 2015 through this summer, several changes to generation in New York have occurred. The mothballing of the Astoria gas turbines No. 8, 10 &11 (83 MW), Huntley Units 67 & 68 (218 MW each), Dunkirk Unit 2 (100 MW) and the retirement of Ravenswood Units 4-6 (64 MW) total 683 MW. Considering all changes and other capacity adjustments (518 MW), the resultant net change for New York generation (from summer 2015 through this summer) is -165 MW.

New York currently has 1,466 MW of installed nameplate wind capacity, of which 230 MW is assumed available during the summer peak demand period.

Demand Response Resources

The New York ISO has three demand response programs to support system reliability:

 The Emergency Demand Response Program (EDRP) provides demand resources an opportunity to earn the greater of $500/MWh or the prevailing locational-based marginal price for energy consumption curtailments provided when the NYISO calls on the resource.

 The Installed Capacity Special Case Resource (SCR) program allows demand resources that meet certification requirements to offer Unforced Capacity to Load Serving Entities.

 The Targeted Demand Response Program, introduced in July 2007, is a NYISO reliability program that deploys existing EDRP and SCR resources on a voluntary basis, at the request of a Transmission Owner, in targeted subzones to solve local reliability problems. The TDRP program is currently available in the New York City zone.

For this summer, the NYISO projects to have approximately 1,254 MW of SCR and 75 MW of EDRP resources available, representing a total of 1,329 MW of available demand response resources.

Transmission

New York does not anticipate any transmission related reliability issues for this summer.

The Transmission Owner Transmission Solutions (TOTS) consists of three distinct transmission projects approved by the New York Public Service Commission as part of the Indian Point Contingency Plan and are projected by the New York Transmission Owners to be in service by summer 2016. The objective of the plan is to increase transfer capability into Southeast New York:

 The Marcy South Series Compensation project - includes adding compensation to the Marcy South transmission corridor through the installation of series capacitors including re-conductoring the Fraser – Coopers Corners 345 kV line;

 The Rock Tavern – Ramapo project - adds a second Rock Tavern – Ramapo 345 kV line and create a Sugarloaf 345/138 kV connection to the Orange and Rockland system;

 The Marcy South Series Compensation and Rock Tavern – Ramapo projects - together increases the transfer capability from upstate to downstate New York; and,

 The Staten Island Unbottling project - relieves transmission constraints between Staten Island and the rest of New York City through the reconfiguration of two substations and the forced cooling of four existing 345 kV feeders.

The Indian Point Contingency Plan also included 125 MW of additional demand response and combined heat and power resources to be implemented by Consolidated Edison.

New England

The Independent System Operator of New England (ISO-NE) forecasts installed capacity of 30,247 MW for the peak week demand forecast of 26,704 MW. Accounting for purchases, sales, required operating reserve, planned and unplanned outages results in an operable spare capacity margin of 740 MW for the peak week.

Natural gas pipeline construction and maintenance is expected to occur throughout the summer capacity period; adequate natural gas pipeline capacity serving New England is anticipated throughout the summer, provided gas supply and transportation is scheduled within each pipeline’s posted capability and natural gas supplies are available.

ISO New England has procedures available to mitigate regional fuel supply emergencies to maintain system reliability, if needed.

Supply-Side Resources

From the summer of 2015 through this summer, new generation projects, primarily wind generation, total 229 MW. There were no retirements reported for New England. Considering all changes and other capacity adjustments (-308 MW), the resultant net change for New England generation (from summer 2015 through this summer) is -79 MW.

ISO New England’s total wind capacity for this summer is 1,022 MW, with 96 MW of that amount counted toward installed capacity.

Demand Response Resources

For this summer, ISO New England has 557 MW of active demand resources expected to be available on peak. The active demand resources consist of real-time demand response of 372 MW and real-time emergency generation of 185 MW, which can be activated with the implementation of New England operating procedures.

In addition to active demand resources, there are 1,839 MW of passive demand resources (i.e., energy efficiency & conservation), which are treated as demand reducers and accounted for in the net load forecast of 26,704 MW. These include installed measures (e.g., products, equipment, systems, services, practices and/or strategies) on end-use customer facilities that result in additional and verifiable reductions in the total amount of electrical energy used during on-peak hours.

Without the effects of passive demand resources, the summer 2016 forecast would equate to 28,543 MW.

Transmission

The New England transmission system is anticipated to be sufficient for this summer. Transmission system upgrades continue to proceed in New England and ISO-NE continually monitors and coordinates transmission facility outages in order to maintain reliability and reduce economic impact that may be associated with these transmission system outages and improvements:

 The Interstate Reliability Project, a portion of the New England East–West Solution is a major transmission project that offers further improvements to New England’s transmission system;

 A new 345 kV line in Connecticut from Card to Lake Road Substations, that went into service during the summer 2015 assessment period; and,

 The 345 kV line from Lake Road to West Farnum Substation (Connecticut to Rhode Island) and the 345 kV line from West Farnum to Millbury Substation (Rhode Island to Massachusetts) were placed into service during winter 2015-16 assessment period.

These upgrades have further improved Connecticut and Rhode Island import and export transfer capabilities and New England’s east-to-west and west-to-east transfer capabilities.

Ontario

The Independent Electricity System Operator (IESO) of Ontario is anticipating spare operable capacity margin of 1,462 MW during the peak week (week beginning July 3, 2016).

Supply-Side Resources

From the summer of 2015 through this summer, capacity additions total 2,267 MW, consisting of wind generation (1,440 MW), solar (240 MW), hydro units (42 MW), biomass projects (208 MW), the Green Electron gas-fired power plant (298 MW) and other capacity adjustments (39 MW). Retirements reduce this total by - 53 MW. Considering all changes, the resultant net change for Ontario generation (from summer 2015 through this summer) is +2,214 MW.

Demand Response Resources

Ontario’s Demand Response (DR) is comprised of the following programs: Peaksaver, dispatchable loads, Capacity Based Demand Response (CBDR) time-of-use (TOU) tariffs and the Industrial Conservation Initiative (ICI). Dispatchable loads and CBDR resources can be dispatched in the same way that generators are, whereas TOU, ICI, conservation impacts and embedded generation output are factored into the demand forecast as load modifiers.

The capacity of the demand response program consists of 369 MW of dispatchable load, 159 MW of CBDR resources, 163 MW of Peaksaver resources, 79 MW of pilot project resources, and 392 MW of Demand Response Auction resources.

Although the total demand response capacity is 1,161 MW, the effective capacity is 674 MW due to program restrictions and market participant actions. During peak periods of the year, market participants take independent action to reduce their consumption for economic reasons, reducing the available capacity for demand measures.

Ontario expanded its demand response programs for the summer of 2016 to include two new programs:

 In December 2015, a Demand Response Auction was held by the IESO to begin replacing expiring multi-year contracts with a more cost-competitive mechanism. The successful Demand Response Auction participants are expected to be ready for energy market participation starting May 1, 2016.

 In April 2015, a competitive Request for Proposal was issued to demand-side resources to procure price responsive consumption capability for a pilot project. The purpose of the pilot was to investigate opportunities to enhance DR participation in meeting system needs through closer integration with the day-to-day operations of the system. The DR Pilot program resources are expected to be in-service for summer 2016.

Transmission

For this summer, Ontario’s transmission system is expected to be adequate. No major transmission additions were added to the Ontario system.

Québec

The Province of Québec is winter peaking. Adequate resources are forecast to be available to serve summer peak demand and meet operating reserve requirements this summer. Québec is projecting weekly operable capacity margins in the range of approximately 4,800 MW to 10,711 MW for this summer.

Supply-Side Resources

Since the summer of 2015 and through this summer, Hydro-Québec Production has added the La Romaine-1 generator (270 MW), and 379 MW of wind generation. Considering all changes and other capacity adjustments (22 MW), the resultant net change for Quebec generation (from summer 2015 through this summer) is +671 MW.

For this assessment, Québec assumed that its entire wind generation capacity of 3,260 MW is 100% derated.

Demand Response Resources

The demand response programs in Québec are available only during the winter period; they are neither required nor available for the summer.

Transmission

In Québec, most transmission line, transformer and generating unit maintenance is done during the summer period. Internal transmission outage plans are assessed to meet internal demand, firm sales, expected additional sales and additional uncertainty margins. They should not impact inter-area transfer capabilities with neighboring systems. Known maintenance/derates vary between approximately 9,800 MW to 12,900 MW. During this summer, some maintenance outages are scheduled on the interconnections. Maintenance is coordinated with neighboring areas so as to provide maximum capability to summer peaking areas.

Maritimes

The Maritime Provinces are also winter peaking. Adequate resources are forecast to be available to serve summer peak demand and meet operating reserve requirements. The Maritimes forecast spare operable capacity margins ranging from approximately 1,300 MW to about 2,400 MW over this summer.

Supply-Side Resources

Since the summer of 2015 and through this summer, the Maritimes will have added 47 MW of wind generation and 7 MW of biomass generation. Considering a small amount of Tidal projects (6 MW) and other capacity adjustments (15 MW), the net change to Maritimes generation (from summer 2015 through this summer) is +75 MW

The Maritimes currently have approximately 1,138 MW of nameplate installed wind generation. After applying derates, the wind capacity for the summer period is assumed to be 217 MW.

Demand Response Resources

Interruptible and dispatchable loads are forecast on a weekly basis and range between 269 MW and 364 MW, and are available for use if or when corrective action is required.

Transmission

The Maritimes transmission system is projected to be adequate to supply the demand requirements for this summer. Hydro Quebec has an outage scheduled on their Madawaska HVDC for refurbishment and New Brunswick has routine maintenance outages scheduled on both of the Eel River HVDC circuits, one circuit down one at a time. Both the Madawaska and Eel River outages will lower the transfer capability in either direction between New Brunswick and Québec, but are not expected to impact the system reliability of the Maritimes.

Estimated Need for Operating Procedures

A wide range of assumptions were analyzed, including extreme weather conditions derived through over 40 years of experience, unexpected plant outages, transmission constraints between and within regions, implementation of operating procedures and estimated impact of demand response programs.

In the probabilistic assessment, chronological system histories were developed by combining randomly generated operating histories of the generating units with the inter-area transfer limits and the hourly chronological loads. Consequently, the system was modeled in great detail with accurate recognition of random events, such as equipment failures, peak load forecast uncertainty, as well as the deterministic rules and policies that govern system operation.

Figure 1 shows the expected use of the indicated operating procedures under the Base Case assumptions and the expected load level. The expected load level is based upon the probability-weighted average of seven load levels simulated.

See the attachment for Figure 1

Following activation of demand response resources, there is no significant likelihood of implementing operating procedures designed to mitigate resource shortages (reducing 30 minute reserve, voltage reduction, and reducing 10-minute reserve) during the 2016 summer period under expected conditions.

The overall NPCC forecast for electricity demand has decreased compared to last summer’s forecast; reflecting the load growth associated with the economic outlook, ongoing conservation measures, improvements in energy efficiency, demand response programs and “behind-the meter” solar facilities.

Additional resources and improved transmission capacity resulting from transmission projects available this summer are additional factors that act to minimize the expected need for the use of these operating procedures this summer.

Established operating procedures are available to maintain reliability and keep electricity supplies and demand in balance if system conditions (such as reductions in anticipated transfers, maintenance extending into the summer period and/or additional constraints) occur with higher than expected electricity demands resulting from a wide spread, prolonged heat wave with high humidity.

Operational Readiness

The Resource and Transmission Reliability Adequacy Assessments are key elements in determining NPCC’s ability to meet the forecast demands of the summer period. To be prepared to deal with the constantly changing operating conditions on the power system, as well as contingencies, NPCC routinely conducts daily and week-ahead planning calls between system operators and neighboring regions to coordinate short-term system operations.

NPCC continues to refine and expand its situational awareness capability to include wide-area visual displays of NPCC and its adjacent Regional Entities to further enable NPCC system operators and neighboring regions to communicate current operating conditions and facilitate the procurement of assistance under emergency conditions.

Geomagnetic Storms

Past experiences have shown the serious effect that geomagnetic disturbances can have on the NPCC bulk power system. These effects can include transformer failures and unintentional tripping of transmission lines (outages) due to geomagnetically induced currents (GICs).

Since 1989, NPCC has operating procedures² in-place to mitigate the effects of GICs resulting from geomagnetic storms. NPCC system operators receive, on a continual twenty-four hour by seven day basis, the status of solar activity and geomagnetic storm alerts.

After reviewing the available data, the system operator evaluates the situation and enacts appropriate measures designed to protect system elements such as transformers, transmission lines, generators, and other critical facilities.

For the 2016 summer Period, the longer-term and more predictable component of geomagnetic activity looks set to oscillate about twice per month. The first and longest interval of activity will tend to occur near the end of the first week of each month at the beginning of the summer and slowly migrate toward the beginning of each month by the end of the summer. The second shorter interval of enhanced activity will tend to occur within the last week of each month at the start of the summer and gradually migrate toward the middle of the month by the end of the summer.

The solar cycle is now entering a phase where geomagnetic activity tends to peak. This phase can last approximately two to three years and is typically when the most dangerous transient disturbances occur. These disturbances are unpredictable beyond the three day mark, because their sources are powerful sunspot groups that tend to form unpredictably and more frequently during this phase of the sunspot cycle. The risk for powerful and potentially damaging disturbances caused by major solar flares is highest during this phase of the cycle.

It is impossible to predict when these sunspot groups will form. The significantly reduced strength of the current solar cycle compared to prior solar cycles adds additional uncertainty as to how this phase of the sunspot cycle will influence the formation of these mammoth sunspot groups. It is expected that the frequency of their occurrence will be reduced, but several powerful episodes of potentially damaging disturbances are expected over the next two to three years.

Since the events associated with solar activity cannot be reliably predicted more than 72 hours in advance, system operators are aware that this phase of the sun’s cycle is most prone to strong GIC activity, and the appearance of such volatile activity could occur at any time over this summer and during the next two to three years.

Natural Gas Supply

While natural gas has become the predominant fuel source in New England, ISO New England continues to monitor impacting factors to the natural gas fuel deliverability throughout the summer reliability assessment periods.

Natural gas pipeline construction and maintenance serving New England 3 is expected to occur throughout the summer capacity period; adequate natural gas pipeline capacity is anticipated throughout the summer, provided gas supply and transportation is scheduled within each pipeline’s posted capability and natural gas supplies are available from the East. New England will continue Gas-Electric coordination and communication efforts in order to maintain situational awareness.

ISO New England has several procedures that can also be invoked to mitigate regional fuel supply emergencies impacting the power generation sector that maintains system reliability.

ISO New England and the interstate natural gas pipeline operators continue to improve the forecast of their combined systems, discuss specific system conditions, and take actions, under their existing authorities, to avoid reliability problems. Sharing information allows ISO New England to better anticipate and address potential reliability problems in the event that there is insufficient fuel for all gas-fired generators to meet their schedules. Along with near-term weather data, load forecasts and planned outage conditions, this information is also used to develop short-term and long-term operating plans.

NPCC

NPCC is one of eight Regional Entities located throughout the United States, Canada and portions of Mexico. The NPCC geographic region includes the State of New York and the six New England states as well as the Canadian provinces of Ontario, Québec and the Maritime provinces of New Brunswick 4 and Nova Scotia. Overall, NPCC covers an area of nearly 1.2 million square miles, populated by more than 56 million people. In total, from a net energy for load perspective, NPCC is approximately 45% U.S. and 55% Canadian. With regard to Canada, approximately 70% of Canadian net energy for load is within the NPCC Region.

NPCC coordinates international electric power grid reliability for Northeastern North America. NPCC annually performs comprehensive seasonal assessments of electricity supply and demand reliability for eastern Canada, New England and the City and State of New York. These assessments require months of detailed preparation and are performed with the participation of regional electricity power grid operators and planners.

Additional information regarding NPCC is available at: www.npcc.org.

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¹ Based on summer nameplate ratings.

² See: https://www.npcc.org/Standards/Procedures/c-15.pdf

³ See: http://www.spectraenergy.com/Operations/US-Natural-Gas-Operations/New-Projects-US/Algonquin-Incremental-Market-AIM-Project/

⁴ Includes the connected part of northern and eastern Maine.

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