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Helping Tucson Electric Power meet Renewable Portfolio Standards

RE-Sim™(Renewable Energy Market Simulation) is an Analytica model developed by Navigant Consulting to help its client, Tucson Electric Power (TEP) plan how it can add generating capacity to meet Arizona's Renewable Portfolio Standards (RPS).

The Challenge

Renewable portfolio standards require power companies to reduce greenhouse gas emissions by generating a percentage of electricity from renewable sources, such as wind, solar, hydro, or biomass. With the introduction of RPS in many US states and European countries, utilities find themselves in an increasingly complex landscape with many renewable energy options, rapidly evolving technologies, changing tax incentives, uncertain demand, and more. Navigant Consulting has developed RE-Sim to assist utilities in navigating this landscape with clarity. They helped Tucson Electric Power to comply with Arizona's Renewable Portfolio Standard requiring the generation of 15% of electricity from renewable sources by 2025. This standard also specifies that a percentage of the renewable energy be satisfied through distributed generation (DG) technologies, such as small-scale photovoltaics located near their users. TEP needed to develop strategies for procuring utility-scale resources and encouraging the adoption of DG. It also needed to forecast the likely costs of compliance with the RPS and to estimate the impact of utility incentives on the adoption of DG technologies. TEP hired Navigant Consulting to create a model to provide them with the data needed to file renewable-energy implementation plans with the Arizona public utility commission. This model had to estimate: 

  • The progress toward compliance at central utility-scale, and distributed generation at residential sites and commercial customer sites
  • The cost of achieving compliance
  • The contribution of each technology toward compliance
  • The cost per kWh for each technology and for the portfolio as a whole

Why Analytica?

To meet TEP's needs, Cory Welch, Navigant's Lead Model Developer, adapted RE-Sim, which he had previously built using Analytica. Welch said, "The primary advantage Analytica provides over competing tools is its flexibility and responsiveness to client needs, which stem from its Intelligent Array algorithm. This feature lets us adapt quickly to client requests for new scenarios or technologies with minimal effort. It also results in faster, lower-cost development, often by a factor of two or three. Another advantage was the ease with which I could develop a graphical user interface. Since TEP wished to conduct scenario analysis on its own, it was key to provide them an interface that permitted them to do so with little effort."

The Solution

To meet TEP's needs, Cory Welch, Navigant's Lead Model Developer, adapted RE-Sim, which he had previously built using Analytica. Welch said, "The primary advantage Analytica provides over competing tools is its flexibility and responsiveness to client needs, which stem from its Intelligent Array algorithm. This feature lets us adapt quickly to client requests for new scenarios or technologies with minimal effort. It also results in faster, lower-cost development, often by a factor of two or three. Another advantage was the ease with which I could develop a graphical user interface. Since TEP wished to conduct scenario analysis on its own, it was key to provide them an interface that permitted them to do so with little effort."

Results

Renewable Energy Market Simulator

Authors

TEP Group Shot

Cory WelchJane Pater Salmon, and Frank Stern -Navigant Consulting.

For more...

This project was developed by Navigant Consulting in association with Tucson Electric Power.