Publ ublic U Utilities es C Commiss ssion Ov Over erview - PowerPoint PPT Presentation

Publ ublic U Utilities es C Commiss ssion Ov Over erview Dianne Martin and Michael Giaimo Chairwoman and Commissioner New Hampshire Public Utilities Presentation to the Office of Consumer Advocate Residential Ratepayers Advisory Board January 27, 2020

Missio ion Stateme ment  To ensure that customers of regulated utilities receive safe, adequate and reliable service at just and reasonable rates  To foster competition where appropriate  To provide necessary customer protection  To provide a thorough but efficient regulatory process that is fair, open and innovative  To perform our responsibilities ethically and professionally in a challenging and supportive work environment OCA Advisory Board Meeting January 27, 2020 2

Budget a and O Org C Char art  PUC Budget is approximately $10 million to satisfy our core mission  This represents a cost of about 37 ¢ per $100 spent on utility services OCA Advisory Board Meeting January 27, 2020 3

Balance P ce Public a c and Ut Utility ity I Interests ts RSA 363:17-a Commission as Arbiter “The commission shall be the arbiter between the interests of the customer and the interests of the regulated utilities” OCA Advisory Board Meeting January 27, 2020 4

PUC’s Le Level o l of Regulatio ion Varie ies b by Industry Water/ Natural Electric Telecom Sewer Gas Commercial & Industrial, Commercial & Industrial and Residential customers have customers have competitive supply competitive supply options options (Left to Right) Most to Least Heavily Regulated by the PUC OCA Advisory Board Meeting January 27, 2020 5

Avoid R Redundan ancy OCA Advisory Board Meeting January 27, 2020 6

Safety Underground Damage Prevention Pipeline Safety Enforce the underground utility damage Inspect natural gas, methane and certain propane facilities prevention program to ensure safety and to ensure compliance with federal and state requirements minimize damage; served by Dig Safe pertaining to design, construction, operation, and maintenance of facilities Electric Safety & Reliability Emergency Preparedness Investigate and report on injuries resulting Coordinate with other state agencies when Emergency Operations Center from contact with utility infrastructure; is activated, collect and distribute lead coordination efforts for system emergency response activities of the restorations and conduct exercises in affected utilities preparation Engineering and GIS Security Maintain Geographic Information System that contains Inspect physical plants of energy critical infrastructure for energy and telecommunication providers; monitor cyber security providers in the state plans of electric and gas utilities OCA Advisory Board Meeting January 27, 2020 7

Key S Stats: A : Averaging 2 225 D Dock ockets Per er Y Yea ear Commission Dockets 250 200 150 100 50 0 FY 2016 FY 2017 FY 2018 FY 2019 Majority of dockets are electricity related OCA Advisory Board Meeting January 27, 2020 8

Key S Stats ts: A Aver eragin ing Ov Over er 1 100 Or Order ers P Per Y Year Commission Orders 160 140 120 100 80 60 40 20 0 FY 2016 FY 2017 FY 2018 FY 2019 OCA Advisory Board Meeting January 27, 2020 9

Key S Stats ts: 9 9,000 I Inquiries M Made t e to P PUC UC/Year Majority of inquiries are electricity related OCA Advisory Board Meeting January 27, 2020 10

Elec ectr tric R c Rates es – Bi Bill Co Components  Delivery Eversource Electric Rate Components  Customer Charge Resident Using 625 kWh/month Total Bill: $126.72  Transmission (FERC) Stranded System  Distribution (PUC) Cost, $12.92, Benefits, 10.2% $3.66, 2.9%  NHEC as member-owned coop has minimal PUC rate regulation Transmission, $12.74,  Energy Energy, 10.1% $56.52, 44.6%  Varies by utility and time of year  Other components  System Benefits Charge Distribution, $25.88,  Stranded Cost 20.4% Customer RPS, $2.31, Charge, 1.8% $12.69, 10.0% Based on rates in effect January 2019 OCA Advisory Board Meeting January 27, 2020 11

Key C Cost D t Driver ers F For E Elec ectr trici city ty  There are major costs drivers facing the region which impact New Hampshire electricity costs, including:  Natural gas prices  Plant additions and retirements  Transmission investments  Energy Efficiency and solar investments OCA Advisory Board Meeting January 27, 2020 12

Evol oluti tion on o of t the R e Region ion’s Ener ergy M Mix  Major shift from oil and 60% coal to natural gas 49% 50% • Region has added 12,000 MWs of natural gas-fired 40% generation over past two 31% 30% 30% decades 22%  Nuclear still represents 18% 20% 15% about 30% of generation 10% 8% 8% 10% 7% • Likely to go down with 1% 1% retirement of Pilgrim 0%  Coal and oil once represented 40% of generation; last year ~2% 2000 2018 Source: ISO New England, New England Power Grid 2018-2019 Profile OCA Advisory Board Meeting January 27, 2020 13

Natural G l Gas Plays M Majo jor R Role ole i in R Reg egional Energy Por ortfolio io a and C Cos ost Wholesale Electricity Prices Track Natural Gas OCA Advisory Board Meeting January 27, 2020 14

Earlier ier T Today … … Low L Location tion M Marginal P Prices ces OCA Advisory Board Meeting January 27, 2020 15

Fuel M Mix a and C Cost C Chan ange D During C Cold Spells Source: https://www.iso-ne.com/about/key-stats/resource-mix/ LMPs can be $17/MWh as they were earlier today, or they can be orders of magnitude greater than that amount during extreme cold spells when coal and oil generation is dispatched OCA Advisory Board Meeting January 27, 2020 16

Whol oles esale le Power er C Cost B t Brea eakdown: E Ener ergy Annual Wholesale Energy Market Value ($Billion) 14 12 10 8 6 4 2 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 OCA Advisory Board Meeting January 27, 2020 17

Emissions Do Down O Over P r Past T Two De Decad ades  Air emissions from regional NOx SO2 CO2 generators have decreased over the last two decades  From 2001 to 2017, annual -34% emissions from SO 2 , NO X , and CO 2 declined significantly  More efficient generation, -74% and the addition of -98% renewables including solar has helped lower emissions region-wide Kiloton reductions 2001-2017 Source: ISO New England, New England Power Grid 2018-2019 Profile) OCA Advisory Board Meeting January 27, 2020 18

Whol oles esale le Power er C Cost B t Brea eakdown: C Capaci city ty 10 $3-$4 Billion 9 Annual Cost to Region 8 7 6 5 4 3 2 1 0 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 FCA Clearing Price $/kw-month OCA Advisory Board Meeting January 27, 2020 19

$10 Billion in R Region ional T l Transmission on Inves estm tment o over er Decade Cumulative Regional Investments in Transmission 12 10 8 6 4 2 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 OCA Advisory Board Meeting January 27, 2020 20

NH P Pays I Its Share o e of R Reg egion onal T Transmis ission on  Capacity and transmission costs are a function of peak demand  NH represents ~ 9.4% of region’s electricity consumption  PUC and OCA continually working on ways to mitigate these costs  To extent utilities can curb use – customers will see reduced capacity and transmission costs ISO-NE 2018 Network Load by State OCA Advisory Board Meeting January 27, 2020 21

Loo ookin king A Ahea ead: W What W We A e Are e Watching F For or In Regiona nal D Discus ussion n  Pay careful attention to additional transmission development that can increase Regional Network Service  Continue to push for competition, challenge high ROEs at FERC, oppose overly conservative and expensive reliability standards  Work with utilities to try and lower peak demand which will effectively reduce energy, capacity, and transmission costs  Oppose other state policies and regional efforts that are unreasonable and shift costs to New Hampshire ratepayers OCA Advisory Board Meeting January 27, 2020 22