NATIONAL CONFERENCE of STATE LEGISLATURES October 9 th, 2009 Ervan Hancock
Georgia Power Overview
Georgia Power Largest of four Southern Company electric utilities $7.2 billion in revenue 2.3M+ customers 9,000 employees 13,000 miles of transmission lines 61,000 miles of distribution lines High customer satisfaction Rates about 10 percent below the national average
Georgia Power Generation Mix Nuclear 10% DSM 4% Gas 37% Hydro 5% Coal 44% Nuclear 16% Gas 16% Hydro 2% Coal 66% 2008 Capacity 2008 Energy
Growth A Good Problem to Face 2008 2030
As of June 2009, 29 states plus DC had renewable portfolio standards and 5 states had renewable portfolio goals. RPS Mandates RPS Goals Source: June 2009, Database of State Incentives for Renewable Energy (DSIRE) RPS standards vary by the requirement size, eligible resources, dates, technology tiers/multipliers, and other factors. 6 Target AZ 15% by 2025 ND 10% by 2015 CA 20% by 2010 NH 23.8% by 2025 CO 20% by 2020 (IOUs), 10% munis and co-ops NJ 22.5% by 2021 CT 27% by 2020 NM 20% (IOUs), 10% (co-ops) by 2020 DC 11% by 2022 NV 20% by 2015 DE 20% by 2019 NY 24% by 2013 HI 20% by 2020 OH 12.5% by 2025 IA 105 MW (2% by 1999), add l 1000 MW goal by 2011 OR IL 25% by 2025 PA 18% in 2020 KS 20% peak demand by 2020 RI 16% by 2020 MA 1 4% by 2009 ( +1%/year after) (tier 1); 3.6% tier 2 SD 25% (large utilities), 5%-10% (small utilities) by 2025 10% by 2015 goal MD 20% by 2022 TX 5,880 MW by 2015 ME 2 10% add l by 2017 class 1 UT 20% by 2025 goal MI 10% by 2015 VA 12% of 2007 sales by 2022 MN 25% by 2025, (Xcel 30% by 2020) MO 15% by 2021 WA 15% by 2020 MT 15% in 2015 WI 10% by 2015 NC 12.5% of 2020 sales by 2021 (IOUs), 10% of 2017 sales by 2018 (munis & co-ops) VT Energy growth 2005-12 met by RE; 20% by 2017
Emerging Policy Waxman-Markey (House Version) Passed 6/27/2009 Renewable Portfolio Standard: Begins in 2012 w/ target of 6% of total generation, culminating at 20% in 2020 Includes Energy Efficiency savings as a percentage of compliance Key Provisions: Energy Efficiency can count for up to 25% of RPS compliance New Nuclear Generations, Plant Efficiency Upgrades, Existing Hydro & Carbon Capture removed from baseline of compliance Renewable generation (non-emitting) sources under 4MW capacity triple count (Distributed Generation) Greenhouse Gas Regulation: Begins in @ 3% below 2005 levels in 2012, culminating at 83% in 2050 Senate Version Underdevelopment : Environmentalists pushing form more aggressive standards and limitation on baseline exclusions
Wind and Solar will Drive the Market Estimated U.S. Annual RE Capacity Additions (MW and Dollars, Business as Usual Assumptions) Estimated RE Capacity Additions (MW) 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 Biomass Wind Low-Impact Hydro Geothermal PV Solar Thermal Electric 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Navigant Consulting, Inc., July 2008. Estimated RE Project Value (Million $) 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 2003 2004 Biomass Wind Low-Impact Hydro Geothermal PV Solar Thermal Electric 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
U.S. Solar Insolation City of Phoenix 211 Cloudless Days per Year (Source NOAA) City of Atlanta 110 Cloudless Days per Year (Source NOAA)
Generation Dispatching
Solar Load Shapes in Southeast Typical Summer Weekday Unitized Load Shapes 1.00 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 1 2 3 4 5 6 7 8 9 101112131415161718192021222324 Hour SoCo PV
Solar Economics Cost of Systems Residential systems average $8-10 per watt installed Systems less than 10kW Average cost per kwh ranges 35-45 cents with the federal incentives Credit: Southern Cal Credit: residentialsolarpowersystems.com
Solar Economics Cost of Systems Commercial systems are $6-8 per watt installed Larger systems not utility scale Cost per kwh ranges 25-35 cents with federal incentives Credit: abundantenergy.com
Solar Economics Cost of Systems Utility scale are $4-6 per watt installed Multiple MWs of Capacity Cost of energy around 25 cents per kwh with federal incentives Credit: Nellis Air Force Base
Solar Incentives Georgia Power will purchase solar from customers through RNR at 18.31 cents per kwh Limited to 1.5 MW (off-set by Green Energy Program) State of Georgia Incentives State Tax Credit: $500,000 or 35% of the installation cost for solar electric $100,000 or 35% of the installation cost for solar hot water $100,000 or 35% of the installation cost for geothermal Total fund: $2.5M Stimulus $4 million in renewable energy grants through GEFA Use for solar photovoltaic's and solar hot water systems Businesses, schools, nonprofits, government facilities, energy utilities Federal Incentives Tax Credit 30% of installation cost for solar electric if installed before 2016
Making Solar Work Long history of support for solar demonstration projects Next step: Evaluating cutting-edge solar technologies 7 photovoltaic technologies installed on roof of corporate office 4 kilowatts in size each Collect data for 12 months work with third-party consultant to evaluate performance Potential to expand by 2010 Bottom line at this point The southeast will need to be very active in the solar market place; understanding emerging technologies, costs and business models 330 KW solar installation Georgia Tech swim center
Where We re Headed Providing Green Energy to customers Allows customers the options subsidize renewable energy Georgia Power currently buys back solar at 18.3 cents/kwhr Largest solar program in GA at over 1.5MW As the demand from customers grows the program will increase
Future of Solar Short Term: The solar industry will be heavily dependant on subsidies (government or green energy programs) Short Term: The southeast will need to be very active in the solar market place; understanding emerging technologies, costs and business models Longer Term: Grid Parity in the Southeast will take more time then other parts of the country Longer term: As solar technologies become more cost effective solar will become an increasing part of a Integrated Resource Plans.
Ervan Hancock Manager, Renewable Development & Green Strategies ehancock@southernco.com 404-506-4702
Questions