Resource Evaluation, Planning,
and Reliability Services
IRP/RFP
The Situation
Many in the power industry can recall the build cycle of the 1990s and early 2000s when independent power producers (IPPs) and unregulated arms of traditional utility companies were adding new, mostly gas-fired capacity, across the US markets in record numbers. This boom left most markets overbuilt, and with high reserve margins and the momentum behind deregulation, the need for traditional resource planning diminished greatly.
Fast forward less than a decade: Reserve margins are once again tightening, deregulated and regulated markets coexist, gas price volatility has reemphasized fuel diversity, regional coordination is increasing, and stringent new environmental regulations are looming. The landscape of the next build cycle has changed dramatically and the need for resource planning has re-emerged. Whether you are a municipal, cooperative, or investor-owned utility, you will encounter many challenges and risks with your next power supply decision:
Traditional Challenges
- Build versus buy?
- What is the best mix of baseload, intermediate, and peaking resources?
- What location and size for the resource?
- What are the dispatch costs or strike prices for this new resource?
- What is the cost to my customers, and what is the rate of return for my shareholders?
New Challenges and Risks
- Am I operating in a regulated or deregulated market?
- Given the recent volatility in gas/oil prices, what type of resource should be considered (i.e., gas, coal, nuclear, renewable, or fixed price)?
- Does the resource satisfy installed capacity requirements?
- Is there regional coordination of planning to consider?
- Am I affected by Renewable Portfolio Standard (RPS) mandates?
- How will the new Clean Air Interstate Rule (CAIR), Clean Air Mercury Rule (CAMR), and carbon regulations affect my power supply decision?
- Where does demand-side management economically fit in to the portfolio? When is it an advantageous option?
- What is the optimal level of reserves and how does this affect my reliability?
The Solution
Amid all the traditional and new challenges, the foundation for a sound resource planning process on a local or regional level is a proven, flexible, comprehensive resource planning tool. Strategist®, Ventyx's resource planning model, provides utilities, regulators, and regional planning entities with the ability to quickly evaluate the customer, environmental, and shareholder impact of any combination of supply and demand-side options.
Strategist applications include:
- Resource planning and portfolio optimization
- Physical and financial supply selections
- Power contract bid analysis
- Demand-side program testing and development
- External energy and capacity market evaluation
- Emissions compliance planning
- Capital project analysis
- Financial analysis
- Load segment or class analysis
- Cost of service and rate impact analysis
Utilizing one comprehensive planning tool will streamline processes, improve decision making and risk analysis, and prepare you for audits from regulatory commissions or regional planning entities. Each power supply decision is critical to the success of your company. As we move towards the next build cycle, be prepared to address the new challenges and measure the risks with Strategist.
Consulting Resources
With more than 30 years' experience assisting small and large clients across the country, Ventyx consultants are uniquely qualified to evaluate your resource planning needs.
