Energy_030612

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Buying Electricity and
Natural Gas for a BIG User
Joan Kowal
Energy Manager, UMCP
March 6, 2012
Sustainable Tuesdays
Speaker Series
Retail Electric Competition
The Electric Utility Industry
The electric utility industry consists of three
functions needed to deliver power to customer
loads:
– Generation
– Transmission
– Distribution
It consists of many entities. Most notable are:
–
–
–
–
Generators (Fossil, Nuclear, and Renewable)
Regional Transmission Organizations (PJM)
Distribution Companies (PEPCO, BGE)
Load Serving Entities or Suppliers (Constellation,
Washington Gas Energy Services, Pepco Energy
Services)
– Government Regulators (FERC, PSC)
– End-users (UMD, homeowners, retail stores)
Typical Electrical System
Electric Supply at UMCP

The electric needs on campus are
met through:
– On-site production from a natural gas,
combined heat and power plant
– Purchased energy delivered at the
Mowatt substation (building located by
Architecture.)
Campus Electric Consumption
300,000
Other Purchased
Electric, 23,147
250,000
200,000
MWH
Produced Electric,
127,356
150,000
100,000
Campus Purchased
Electric, 105,655
50,000
0
2006
2007
2008
2009
2010
2011
UMD Combined Heat and Power Plant
• 27.5 MW natural gas, CHP plant
installed at the College Park Campus
– Doubled steam efficiency from 35% to
nearly 70%
– Energy Star award for 2005
– Annual CO2 reductions of 53,000 tons
– Also produces chilled water for air
conditioning using steam in summer
Auxiliary
Boilers
How System Works:
Make Up
Water
2 Heat
Recovery
Steam
Generators
Exhaust
Heat
6250 F
Fuel
Gas or Oil
625 PSI
Steam
Back
Pressure
Steam
Turbine
Steam Driven
Chillers on
Campus
125 PSI
Steam
Electric
Power
5MW
Electric Power
2 Combustion Turbines
22 MW
and Generators
70% of Condensate Returns to CHP
Heating
Steam
Chilled
Water
Energy Procurement

Electricity
– Supplier – WGES
– Distribution Company – PEPCO
– Contract Structure (main campus)
• Block and Index
• Fixed Supplier Fee
• All other costs are a pass-through
– Term is 3 years with two, 1 year options
Electric Contract (cont’d)

Block and Index Contract
– Advantages
• Reduces risk premiums from supplier
• Allows UMD to reduce costs by reducing load in
high priced hours
• Allows rate to more closely reflect market over
term of contract in lieu of locking in fixed-price
for entire term on one day
– Disadvantages
• Reduced price certainty
Electricity Procurement
Block and Indexed
July Monthly Blocks vs
July Daily Weekday Usage
14.00
Buying in the
hourly market
12.00
Selling in the
hourly market
10.00
MW
8.00
6.00
4.00
2.00
0.00
1
2
3
4
5
6
7
8
9
10 11 12 13 14 15
Hour of the Day (ending)
July Block volumes purchased
16
17
July 1st actual usage
18
19
20
21
22
23
24
Natural Gas Procurement
Supplier – Pepco Energy Services/WGES
 Distribution Company – Washington
Gas Light
 Contract Structure

– Fixed Price for small accounts
– Block and Index contract for CHP supply
– Large account is interruptible; oil used as
back-up fuel
Natural Gas Procurement
Block and Indexed
June Natural Gas Use vs Block Purchase
64,000
Usage
Buying in the Daily Market at Index
63,000
Block
Purchase
62,000
61,000
Therms
60,000
Selling in the
Daily Market
59,000
58,000
57,000
56,000
55,000
54,000
53,000
06/01/11
06/06/11
06/11/11
06/16/11
06/21/11
06/26/11
MD Renewable Energy

State has a renewable portfolio standard
(RPS) that requires electric suppliers to
meet certain standards:
– In 2012, 6.5% from Tier 1 renewable sources
(including at least .1% from solar); and
2.5% from Tier 2 resources
– In 2022, 20% from Tier 1 renewable sources
(including at least 2% from solar); and 0%
from Tier 2 resources
RPS Definitions – Tier I











(1) solar energy including PV and solar hot water heating;
(2) wind;
(3) qualifying biomass;
(4) methane from the anaerobic decomposition of organic
materials in a landfill or wastewater treatment plant;
(5) geothermal;
(6) ocean, including energy from waves, tides, currents, and
thermal differences;
(7) a fuel cell that produces electricity from a Tier 1 renewable
source under item (3) or (4) of this subsection;
(8) a small hydroelectric power plant of less than 30 megawatts
(9) poultry litter-to-energy
(10) waste-to-energy; and
(11) refuse derived fuel.
RPS Definitions – Tier II

Hydroelectric power other than pump
storage generation
On-site Renewable Energy

Solar hot water heating system installed
at Ellicott Dining Hall and to be included
at the University House
 Solar photovoltaic at Cole Field House –
5.25 kW
 Installation of geothermal heat pumps at
the new Shuttle Facility; two renovated
Sorority Houses; and new University
House
Project Sunburst





DOE American Recovery and Reinvestment
Act of 2009 funds allocated to Renewable
Energy in MD
UMCP was awarded a grant of $1000/kW of
installed solar capacity
Competitive solicitation awarded to WGES and
Standard Solar for a 630kW installation at
Severn
Commercial Operation June, 2011
Estimated output of 792 MWh annually
Aerial View of Severn with
2,300 Solar Panels
Off-Site Renewable Energy

Executed three long term
power purchase agreements
(PPAs)
– Two land based wind with
total capacity of 65 MW
– One solar project with capacity
of 13MW

Aggregation of University
System of Maryland
Institutions with state and
local agencies
Buying Off-Site Renewables
•
Bundled RECs through PPAs
•
•
•
Long term commitment to buy power and RECs
If buyer doesn’t buy RECs, power cannot be
counted as renewable energy
Unbundled RECs
•
Green attributes associated with power
generation
Bundled RECs through PPAs
Load
Serving
Entity
Electricity and
RECs bundled
together
Unbundled RECs
Can claim
renewable energy
1 MWh REC
1 MWh Elect.
1 MWh Elect.
Electricity and
RECs sold
separately
Can’t claim
renewable energy
Renewable PPA Contracts –
Project
Roth Rock
Phase II
Pinnacle
Project
Constellation’s
Mount St.
Mary’s Solar
Project
WGES’ Severn
Solar
Installation
Total
Nameplate
Capacity (expected
annual MWh)
10 MW –
(30,605)
55 MW –
(174,542)
13MW –
(22,291)
630kW
(792)
UMCP’s
Share
% of
Annual
Electricity
Use
10%
1.53%
10%
9%
10%
100%
On-line
Date
Technology
Location
Land-based
wind
Land-based
wind
MD – Garrett
County
WV - Mineral
County
1%
Solar
MD Emmitsburg
6/12
0.40%
Solar
Severn
6/11
11.77%
8/11
1/12
References
eia.doe.gov/
 www.ferc.gov/
 www.eei.org/
 www.energy.state.md.us/

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