Arizona-based utility Tucson Electric Power (TEP) says it plans to meet customers' growing energy needs over the next 15 years by relying less on coal generation and more on renewables, energy efficiency and natural gas.
TEP filed with regulators its 2014 Integrated Resource Plan, which describes how the utility intends to meet energy demand requirements through 2028. According to current projections, the company expects to add more than 50,000 customers over the next 10 years, and peak demand is projected to grow annually by about 1% to 1.5%.
TEP plans to serve these growing energy demands through a long-term portfolio diversification strategy that will reduce the company's reliance on coal-fired generation. The company intends to reduce its overall coal capacity by 492 MW, or about 32%, over the next five years.
The utility plans to further diversify its portfolio through continued investments in renewable energy and energy efficiency programs. By 2028, TEP anticipates that its combined solar, wind and biogas resource capacity will increase from 157 MW today to 788 MW – enough energy to power approximately 136,000 homes. TEP says it also plans to reduce its need for new generating resources through a range of energy-efficiency programs that will result in a cumulative capacity reduction of 312 MW, which is equivalent to the annual electric energy use of approximately 167,000 homes.
To replace some of the lost capacity from existing coal-fired resources, TEP and sister company UniSource Energy Services are also planning a joint purchase of a 550 MW combined-cycle unit at natural-gas-fired plant in Arizona.
Overall, TEP projects that its resource portfolio by 2028 will consist of 43% coal-fired generation and 36% natural gas-fired resources. The remaining 21% will be made up of renewable energy and energy efficiency resources.