NESCOE’s 2019 Economic Study:

Offshore Wind Integration

Business Network for Offshore Wind

October 17, 2019

Ben D’Antonio, Counsel & Analyst

New England States Committee on Electricity

2

² Focus:ResourceAdequacy,SystemPlanning&

Expansion

² Resources:5full-timestaffwithdiversedisciplines&

experience.Consultantsonmarkets,transmission&for

independentstudies

²Moreinformation:includingfilings&commentsat

§ www.nescoe.com

§ Twitter:@NESCOEStates

NESCOEisNewEngland’sRegionalStateCommittee,

governedbyaBoardofManagersappointedbyeachofthe

NewEnglandGovernorstorepresentthecollectiveviewsof

thesixNewEnglandstatesonregionalelectricitymatters

Overview

• StateLawsandSelectedMechanisms

• ResourceAdequacyandStateLaws

• AnalysisofRenewableandCleanEnergy

3

StateLawOverview

• EachNewEnglandStateadoptslawsandregulations

reflectiveofthepolicieseachstateidentifiesasappropriate

forconsumersinthatstateaswellasthemechanisms

throughwhichtoimplementthosepolicies

• NewEnglandStateswithpoliciesthatprioritizeclean

energyresourceshavecommittedtoexploreamechanism

tovaluetheattributesofthoseresources,whileensuring

consumersinanyonestatedonotfundthepublicpolicy

requirementsmandatedbyanotherstate’slaw– Mostrecentexample:https://www.coneg.org/wp-content/uploads/2019/03/New-England-

Governors-Statement-of-Cooperation-on-Regional-Energy-3-15-19.pdf

4

RenewableResources

Common Technologies State State-Specific Additional Technologies

• Wind

• Solar Photovoltaic (PV)

• Small Hydro

• Landfill Gas

• Biomass (subject to

eligibility requirements)

• Anaerobic Digestion

• Geothermal

• Solar Thermal

• Ocean Thermal

• Wave

• Tidal

• Fuel Cells using

Renewable Fuels

MaineMunicipal Solid Waste (“MSW”) with recycling,

combined heat and power (“CHP”), Thermal

MassachusettsSustainable biomass, certain new or incremental

hydroelectric, MSW with recycling

Connecticut

Sustainable biomass, MSW, fuel cells using non-

renewable energy, CHP, new hydro, large-scale hydro

(only if shortfall in Class I resources, capped at 5% in

2020), low-emission advanced renewable energy

conversion technologies

Rhode Island Sustainable biomass

Vermont Large Hydro, small distributed generation

New

Hampshire

“Useful thermal energy”, CHP, new or co-fired

biomass, biodiesel

5

RenewablePortfolioStandard

6

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Connecticut

Class I 19.5% 21.0% 22.5% 24.0% 26.0% 28.0% 30.0% 32.0% 34.0% 36.0% 38.0% 40.0%

Class II 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%

Class III 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%

Maine

Class I 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0%

Class Ia 2.5% 5.0% 8.0% 11.0% 15.0% 19.0% 23.0% 27.0% 31.0% 35.0% 40.0%

Class II 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0%

Massachusetts

Class I 14.0% 16.0% 18.0% 20.0% 22.0% 24.0% 26.0% 28.0% 30.0% 32.0% 34.0% 35.0%

Class IIa 2.7% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2%

Class Iib 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5%

Clean Energy Standard 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 5.0%

New Hampshire

Class I 9.6% 10.5% 11.4% 12.3% 13.2% 14.1% 15.0% 15.0% 15.0% 15.0% 15.0% 15.0%

Class II 0.6% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7%

Class III 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 8.0%

Class IV 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5% 1.5%

Rhode Island

Existing 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%

New 12.5% 14.0% 15.5% 17.0% 18.5% 20.0% 21.5% 23.0% 24.5% 26.0% 27.5% 29.0%

Vermont

Distributed Generation 2.2% 2.8% 3.4% 4.0% 4.6% 5.2% 5.8% 6.4% 7.0% 7.6% 8.2% 8.8%

Standard 52.8% 56.2% 55.6% 55.0% 58.4% 57.8% 57.2% 60.6% 60.0% 59.4% 62.8% 62.2%

RenewablePortfolioStandard

7

0

10,000

20,000

30,000

40,000

50,000

60,000

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

An

nu

al

Ele

ctri

c E

ne

rgy

(G

Wh

)

Year

Total projected RPS targets (all classes) for New England,

2019 to 2030, in GWh

Total New RPS Resources

Total Exising RPS Resources

PublicPolicyResource Outlook

8

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

An

nu

al

Ele

ctri

c E

ne

rgy

(G

Wh

)

Total projected policy resource targets (all classes) and goals for New England,

2019 to 2030, in GWh

Traditional Resources

MA Clean Energy

New Renewables

Existing Renewables

Behind-the-Meter Solar PV

Energy Efficiency

Long-TermContracts

• CleanEnergyRequestforProposals(RFP)– EntitiesfromthreeoftheNewEnglandStates- Connecticut,Massachusetts,andRhodeIsland- jointly

issuedanRFPfromprivatedevelopersofcleanenergyandtransmission.Thethreestatesselectedprojectsthatwere,collectively,about460MW.Noneoftheprojectsincludedtransmission.

• MassachusettsLong-TermContractsforCleanEnergy– MassachusettsElectricDistributionCompanies(EDCs)enteredintolong-termcontractswithH.Q.

EnergyServicesInc.andrelatedtransmissionagreementswithCentralMainePowerCompany(CMP)inconnectionwiththeNewEnglandCleanEnergyConnect100%Hydroproject.TheMassachusettsDepartmentofPublicUtilities(DPU)approvedthelong-termcontractswithHydroQuebecEnergyServices,Inc.FERCapprovedtherelatedtransmissionagreementswithCMP.Theprojectissubjecttofurtherfederalreviewandapproval.

• Connecticut,Massachusetts,andRhodeIslandLong-TermContractsforOff-shoreWind– MassachusettsEDCsenteredintolong-termcontractswithVineyardWindLLCforan800megawatt

offshorewindgenerationproject.In2019,theDPUapprovedtheVineyardWindcontractsandsubsequentlyapprovedarequestbytheEDCstoissueanRFPsolicitingadditionaloffshorewindgeneration.

– TheRhodeIslandPublicUtilitiesCommissionhasapprovedalong-termcontractfortheRevolutionWind400megawattoffshorewindgenerationproject.

– In2018,theCTPublicUtilitiesRegulatoryAuthorityapprovedlong-termcontractsforthe200megawattRevolutionWindproject.

• ConnecticutZeroCarbonSolicitationandProcurement– ConnecticutselectedtwonuclearpowerbidsfromMillstonePowerStationandSeabrookNuclear

PowerPlant,alongwithninesolarprojectbidstotaling165MW– twoofwhicharepairedwithenergystorage– andone104MWoffshorewindprojectinasolicitationforzero-carbonelectricity-generatingresources.

**Note:Severalstateshavealreadyprocuredcleanenergyresourcesvialongtermcontractundertheseandotherexistingstateenergyprocurementauthorities** 9

ResourceAdequacyandStatePolicies

• States’long-termcontractswithresourcescapableofsupportingstatepoliciesmaynotbecountedtowardISO-NE’sFCMprocurementtarget

• RenewableTechnologyResource(RTR)ExemptionPhasing-out

• ISO-NE’s“CASPR”reformsallownewresourcessupportedbylong-termcontractstobuy-outretiringresources’capacitysupplyobligations

10

RenewableandCleanEnergyAnalysis

11

2015

Whitepaper

2017

ScenarioAnalysis

Modeling

2018

Mechanisms

Analysis

For more information,

please visit the Resource

Center at NESCOE’s Website

nescoe.com

2019-2020

Off-shoreWind

Integration

This analysis is to inform

consideration of options;

it is not a recommendation

or an expression of

preferences

EconomicStudyRequest

• ScenarioAnalysis– Increasinglevelsofincrementaloffshorewindresources

• TransmissionAnalysis– High-LevelConceptualTransmissionOverlays

– TransmissionUpgradeCostEstimates

– VariousPointsofInterconnection

• WholesaleMarketImpacts– Energy,Capacity,AncillaryServices

– PricesandAirEmissions

– AncillaryServicesRequirements

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ScenariosRequested

MW of New Offshore Wind

By 2030

1,000

2,000

4,000

By 20355,000

7,000

• Primary location of new resources: MA or RI/MA Wind Energy Areas (WEA) on

the outer Continental Shelf

• Remaining amount of new offshore wind resources would be from a yet-to-be

determined WEA in the Gulf of Maine

13

TransmissionAnalysis Request

• IntegratenewwindresourcesatdifferentpointsofinterconnectionintoNewEnglandandestimatetransmissionupgradecostsassociatedwiththeseconceptualconfigurations

• ConsiderallreasonablepointsofinterconnectioninNewEngland,includingtheprospectofinterconnectingsouthernWEAsnorthofCapeCod

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2019EconomicStudyAssumption

• Off-shorewindadditionswillbemodeledtocoverareasoffthecoastofRhode-IslandandSouthernMassachusettsthatareclosetotheareasthathavebeenauctionedbytheBureauofOceanEnergyManagement(BOEM)– BasedonNationalRenewableEnergyLaboratory(NREL)data,thosearethesiteswith

thehighestcapacityfactor

15Source:ISO-NE

ISO-NEPreliminaryAssessment

• Thetransmissionsystemwillbemodeledusing2030internaltransmission-interfacetransfercapabilities

• Basedonthecurrentlyexpectedtransmissionsystemfor2030,theISOanticipatesthatthefollowinglevelsofoff-shorewindadditions(approximately7,000MW)havethepotentialtoavoidmajoradditional345kVreinforcements*

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Bourne/Canal/Pilgrim (MA): 2,400 MW

Brayton Point (MA): 1,600 MW

Mystic (MA): 1,200 MW

Montville (CT): 800 MWKent County/Davisville (RI): 1,000 MW

*Some 345 kV reinforcement/expansion

may still be needed for this scenario.

This anticipation is preliminary

(system impact studies have

not been completed for all of these MW).

This anticipates minimal interconnection

at nameplate levels and capacity

interconnection at intermittent capacity

values – does not anticipate all of the

MW being able to run simultaneously

at nameplate levels at all times on the system.

Possible off-shore wind additions* (MW and location)

Source:ISO-NE

2019EconomicStudyDetails

17

NESCOE

Year 2030

Gross

Demand

Energy

Efficiency

Behind-the-

Meter PV

(Nameplate)

Utility Scale

PV

(Nameplate)

Supply

(incl.

Demand

Resources)

RetirementsRFP Committed

Generation

Off-Shore

Wind

Additions

(Nameplate)

Demand from

Heat Pumps

Demand from

Electric Vehicles

Battery

Storage

Additions

NESCOE_2000

Based on 2019 CELT Forecast

2019 CELT

generators and cleared

FCA 13

resources

FCA 13 and

Mystic 8&9

NECEC (1,090 MW

of firm import)1,000 MW of off-

shore wind

(nameplate)1

1,000 MW

None

550,000 vehicles 2,000 MW

NESCOE_3000 2,000 MW

NESCOE_5000 4,000 MW

NESCOE_6000 5,000 MW2,050 MW

NESCOE_8000 7,000 MW1 Includes Vineyard Wind (800 MW) and Revolution Wind (200 MW)

• TheNESCOE_2000throughNESCOE_6000scenarioswillberunwithoutsignificantassumedtransmissionreinforcements

• TheNESCOE_8000scenariowillberunwithfourhypotheticaltransmissionreinforcements– High-levelassumptionswillbemaderegardingthelevelofincreasesintransfercapabilityprovidedbyeachassumedtransmissionreinforcement• SEMA/RIexport(assumedtransmissionreinforcements#2,#3,and#4)

• West-East/East-West(assumedtransmissionreinforcement#4)

Source:ISO-NE

2019EconomicStudy

HypotheticalTransmission• Off-shorewindadditionsabove7,000MWasshownonthepriorslidewouldrequire:

– Additionallargeunitstobeassumedretiredinareasofnewinjections;and/or

– Potentialneedforsignificanttransmissionreinforcements,asshownbelow

• TheISOwillneedtoassesstheallowablelevelofinjectionsoftheassumedtransmission

reinforcements

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#2: 345 kV reinforcements from the

Cape to Stoughton/K. Street

#3: 345 kV reinforcements from Brayton Point

to Millbury/West Medway/West Walpole

#4: 345 kV reinforcements between

Montville and Kent County

#1: Direct injection into K

Street

Source:ISO-NE

2019EconomicStudyScenarios

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Interconnection

Point

Bourne/Canal

/Pi lgrim Brayton Point

Kent County

/Davisvi l le Montvi l le Mystic Mi l l s tone

Assumed Major Additional

Transmiss ion Reinforcement(s ) Total MW

RSP Area SEMA SEMA RI CT Boston CT

NESCOE_2000 800 500 700 None 2000

NESCOE_3000 1,500 800 700 None 3000

NESCOE_5000 2,400 800 1,000 800 None 5000

NESCOE_6000 2,400 1,600 1,000 800 200 None 6000

NESCOE_8000_1 2,400 1,600 1,000 800 2,200 #1: Direct injection into K Street 8000

NESCOE_8000_2 3,400 1,600 1,000 800 1,200

#2: 345 kV reinforcements from the

Cape to Stoughton/K. Street 8000

NESCOE_8000_3 2,400 2,600 1,000 800 1,200

#3: 345 kV reinforcements from

Brayton Point to Mi l lbury/West

Medway/West Walpole 8000

NESCOE_8000_4 2,400 1,600 1,500 1,300 1,200

#4: 345 kV reinforcements between

Montvi l le and Kent County 8000

Anbaric_8000 3,400 1,600 1,000 800 1,200

#2: 345 kV reinforcements from the

Cape to Stoughton/K. Street 8000

Anbaric_10000

Anbaric_Sens3,400 2,600 1,500 1,300 1,200 #2, #3 and #4

10000

Anbaric_12000 3,400 2,600 1,500 1,300 2,200 1,000 #1, #2, #3 and #4 12000

Offshore wind injections dis tributed to mimic 1) awarded RFPs 2) locations of queue pos i tion requests and 3) location of assumed transmiss ion reinforcements

Signals anticipated maximum level of MW injection at the interconnection point before major additional 345 kV reinforcements are needed

Signals MW injection at the interconnection point requiring major additional 345 kV reinforcement(s )

Values shown in MW

Source:ISO-NE

nescoe.com