To help satisfy the U.S. Environmental Protection Agency’s (EPA) Clean Power Plan (CPP), Arizona-based Tucson Electric Power (TEP) anticipates an additional 1.1 GW of new renewable capacity by the end of 2030, boosting its total renewable energy portfolio to approximately 1.5 GW.
The utility has revealed its intentions in a preliminary 2016 Integrated Resource Plan (IRP). Under direction from the Arizona Corporation Commission, TEP and other regulated Arizona power providers have filed preliminary IRPs because of uncertainties raised by the CPP, a mandate to reduce carbon-dioxide emissions from power plants.
TEP says it and other stakeholders spent the last several months working with the Arizona Department of Environmental Quality to identify strategies that could be used to satisfy state CPP requirements.
“Our initial analysis suggests that TEP’s resource-diversification strategy is consistent with the targets set forth in the final CPP,” says David G. Hutchens, TEP’s president and CEO.
Although the U.S. Supreme Court recently suspended enforcement of CPP requirements in response to a legal challenge, Hutchens says, “We will continue working toward our goals as the CPP’s status is resolved.”
TEP says it will keep investing in large solar arrays and other community-scale renewable resources. The IRP also explores how distributed energy resources, such as rooftop solar panels, have created new challenges and opportunities for utilities and their customers. TEP expects to use more sensing and measurement devices to respond to the increase of intermittent renewable resources on its distribution system, effectively enabling some portions of the local electric grid to function as stand-alone microgrid systems.
Furthermore, the utility is examining how energy storage and smart grid technologies can improve reliability. For example, construction is expected to begin this year on two 10 MW storage projects that will be used to study how energy storage can help maintain the required balance between energy demand and supply, as well as other energy management requirements.
Energy efficiency measures continue to be cost-effective resource options, TEP adds. The utility says it will continue working to meet the aggressive goals outlined in Arizona’s Energy Efficiency Standard, which calls on utilities to achieve cumulative energy savings of 22% by 2020. This year, TEP will offer several new energy efficiency programs.
The company has ceased burning coal at its Sundt generating station in Tucson and will lose 170 MW of coal-fired capacity when Unit 2 at the San Juan Generating Station in New Mexico is shut down at the end of 2017. TEP will continue to own a 170 MW share of Unit 1 at San Juan but has an option to exit that unit in 2022.
However, TEP emphasizes that reductions in coal-fired resources will not diminish the importance of the coal-fired Springerville Generating Station (SGS) in eastern Arizona.
“SGS is the lowest-cost, most efficiently run coal resource in our fleet and has always been part of our long-term resource planning,” explains Hutchens. “We are committed to a diversification strategy that benefits from capacity reductions at other TEP-owned coal-fired power plants.”
