Houston Region Import Capacity Project August 27, 2013 Regional Planning Group Meeting Background Tie line capability limited to approximately 6500 MW currently Generation ‾ Previously or currently mothballed units: 1367 MW ‾ Additional units approaching 50 years old: 1174 MW ‾ Recent generation additions have been relatively small ‾ Houston is a non-attainment zone ‾ Proposed Pondera (1300 -1380MW) has not provided Notice to Proceed since signing SGIA in 2010 Recent ERCOT publications (2012 Constraints and Needs report and 2012 Long Term Study) show need for additional import path into Houston CNP has serious concerns about reliability/resource adequacy for the Houston load pocket because of limited import capability 1 Older Units Possible future retirements - a total of 1939 MW in-service units will be older than 50 years by 2018. These resources were modeled as online in the Study Case. 2 Houston Load Pocket Projected Reserves Note: Resources include both generation and import capacity into Houston 3 Study Approach Phase I: Study Case Analysis Modify SSWG 2015-2018 base cases created in February 2013 - Remove Pondera (1300 MW) - Add Deer Park Energy Center expansion (215 MW) - Add Calpine Energy Center expansion (200 MW) - CNP load matches 2012 ALDR (other than new transmission customers) • Non-coincident peak • Hot summer load level (102 degree F) • 2013 ALDR CNP load about 600 MW higher in 2018 than in 2012 ALDR • CNP studying over 1000 MW of industrial load not included in 2013 ALDR which could be on-line as early as 2016 4 Study Approach Phase I: Study Case Analysis Use ERCOT Criteria: Planning Guide 4.1.1.2 (1)(b) - Take largest unit inside Houston “zone” out of service: Cedar Bayou Unit 2 (745 MW) - Perform Single and Common Mode contingencies (Common tower outage) · Overload of Singleton – Zenith circuits beginning in 2018 (100.8% in 2018) Emergency Loading % ** From bus ** ** To bus ** CKT Rating Yr 2015 Yr 2016 Yr 2017 Yr 2018 Contingency Description 44645 SNGLTN_345 345 44900 ZENITH__345A 345 98 1450.0 95.2 95.9 100.8 TOMBALL 345 SINGLETON & KING ROANS PRAIRIE 44645 SNGLTN_345 345 44900 ZENITH__345A 345 99 1450.0 95.3 95.9 100.8 TOMBALL 345 SINGLETON & KING ROANS PRAIRIE 5 Houston Region Phase I: Study Case Analysis Cedar Bayou 2 out-of-service Year Peak Load (MW) Peak Transmission Losses (MW) Peak Demand (MW) Installed Capacity w/o CB2 (MW) Previously and Currently Mothballed (MW) Average Import Capacity From 138 and 345 kV Ties (MW) Planned Resources with Signed IA, Air Permit, and Securitized Deposit per Table 2-1 (MW) Total Resources (MW) Surplus/Deficit (MW) Additional Reserve/Deficit Margin 2015 2016 2017 2018 19111 19331 19525 19726 291 319 330 346 19402 19650 19855 20072 11706 11706 11706 11706 1367 1367 1367 1367 6500 6500 6500 6500 415 415 415 415 19988 19988 19988 19988 586 338 133 (84) 3.07% 1.75% 0.68% -0.43% 6 Phase I: Reliability Analysis – CB2 out Sensitivity Analysis Without 1367 MW mothballed generation – loading of 114% for year 2015 ** From bus ** ** To bus ** CKT Emergency Loading % Type Rating Yr 2015 Yr 2016 Yr 2017 Yr 2018 44645 SNGLTN_345 345 44900 ZENITH__345A 345 98 LN 1450.0 114.3 121.4 124.1 134.3 44645 SNGLTN_345 345 44900 ZENITH__345A 345 99 LN 1450.0 114.3 121.5 124.2 134.4 44650 SMTHRS__345A 345 47000 BELAIR__345A 345 98 LN 44645 SNGLTN_345 to 46500 TOMBAL__345B 345 74 1137 1924.0 96.2 95.2 97.8 99.4 102.0 103.1 108.5 Contingency Description TOMBALL 345 - SINGLETON & KING - ROANS PRAIRIE TOMBALL 345 - SINGLETON & KING - ROANS PRAIRIE BELLAIRE 345 - JEANETTA 345 CKT.64 & BELLAIRE 345 - WA PARISH 345 CKT.50 SINGLETON - ZENITH 345 CKT.98 & SINGLETON - ZENITH 345 CKT.99 New 500 MW generator inside CNP – loading of 92% for year 2018 Emergency Loading % ** From bus ** ** To bus ** CKT Rating Yr 2015 Yr 2016 Yr 2017 Yr 2018 44645 SNGLTN_345 345 44900 ZENITH__345A 345 98 1450.0 87.0 87.5 92.2 44645 SNGLTN_345 345 44900 ZENITH__345A 345 99 1450.0 87.0 87.5 92.2 Contingency Description TOMBALL 345 - SINGLETON & KING - ROANS PRAIRIE TOMBALL 345 - SINGLETON & KING - ROANS PRAIRIE 7 Study Approach Phase II: Interconnection Options and Initial Screening – Evaluate transfer capability of the 2018 Study Case and 25 Options – Use ERCOT 2012 average transmission costs to estimate each option - Include estimated costs of reinforcements – Rank Options based on Transfer Improvement Value (MW transfer increase) / (Cost) – Select best Options for additional analysis Phase III: Interconnection Options Detailed Analysis – Evaluate voltage stability impacts and estimate reactive compensation for each Option – AC Contingency and Short-circuit analysis – Prepare detailed cost estimates using typical CenterPoint Energy costs Identify preferred interconnection options that maximize increased transfer capability versus total project cost 8 Twenty-five Options Studied Options 1 - 16 Jordan 9 Twenty-five Options Studied Options 17 – 25 10 Comparison of Electrical Alternatives 11 Five Options Selected for Further Study 21 12 Phase III: Additional Studies Detailed Cost Analysis 13 Three Preferred Interconnection Options Preferred Interconnection Options Transfer Increase (MW) New 345 kV Cost ($ MM) MW/$ MM Structure-miles ** Option 15 : Twin Oak-Zenith (including system improvements) 2701 117 462 5.85 Option 24 : Ragan Creek-Zenith* (including system improvements) 1960 69 297 6.60 Option 25 : Limestone-Ragan Creek-Zenith* (including system improvements) 2532 130 532 4.76 *Ragan Creek is a future 345 kV Switching Station to be constructed as part of the interconnection option. **New 345 kV structure-miles include a 20 percent increase from their point-to-point straight-line distances to account for uncertainty in routing. 14 System Configuration – Option 15 Option 15: Twin Oak – Zenith 345 kV G Limestone G Jewett Twin Oak TNPONE Jack Creek G G Gibbons Creek Singleton ROANS PR 2018 Bobvle Tomball G Zenith T.H.W North Belt 15 System Configuration - Option 24 Option 24: Zenith – Ragan Creek 345 kV G Limestone G Jewett Nucor Twin Oak Jack Creek Ragan Creek G G Gibbons Creek Singleton ROANS PR 2018 Bobvle Tomball G Zenith T.H.W North Belt 16 System Configuration - Option 25 Option 25: Limestone - Ragan Creek – Zenith 345 kV G Limestone G Jewett Nucor Twin Oak Jack Creek Ragan Creek G G Gibbons Creek Singleton ROANS PR 2018 Bobvle Tomball G Zenith T.H. W North Belt 17 Conclusions Unless additional net generation or new import transmission paths into Houston region are constructed CNP will not comply with ERCOT’s Planning Criteria by year 2018. 25 interconnection options studied. Three options are recommended based on technical and economical analysis. 18 Conclusions – Option 15: New Twin Oak - Zenith 345 kV double circuit: 2700 MW transfer capability improvement. $462 million project cost. 5.85 MW/$MM transfer/cost value. New line connects Oncor’s and CNP’s substations. Includes approximately $7.5 million in LCRA 138 kV line upgrades. – Option 24: New Ragan Creek – Zenith 345 kV double circuit: 1960 MW transfer capability improvement. $297 million project cost. 6.60 MW/$MM transfer/cost value. New line connects CNP’s Zenith substation to a new 345 kV Ragan Creek substation. Includes $5 million upgrade of TMPA Twin Oak - Jack Creek -Ragan Creek double circuit. Includes approximately $2 million in LCRA 138 kV line upgrades. – Option 25: New Limestone – Ragan Creek - Zenith 345 kV double circuit: 2530 MW transfer capability improvement. $532 million project cost. 4.76 MW/$MM transfer/cost value. New line connects Limestone to new 345 kV Ragan Creek substation to Zenith substation. Includes approximately $5.5 million of LCRA 138 kV line upgrades. 19 Questions?