November 21, 2024 • 31 mins
How will the demand for electricity, a changing generation mix, and the transmission system evolve over the next 10 years? This is the question that our Reliability Needs Assessment (RNA) examines in order to assess and identify impacts to reliability.
In the latest Power Trends podcast, Senior VP of System & Resource Planning Zach Smith dives deep into the 2024 RNA to explain how the NYISO analyzes demand forecasts, seasonal variations, and the impact of electrification on heating and transportation to ensure the grid can meet future needs.
Smith covers report findings that include the identification a Reliability Need in New York City in the summer of 2033, as well as changing scenarios that could solve for the need. Additional topics covered in the conversation include the NYISO’s Interconnection Queue, large energy-intensive projects, and important grid investments such as the Champlain Hudson Power Express.
This episode is a must-listen for anyone interested in the future of New York’s power grid and the many scenarios that must be examined to ensure its reliability.
Listen now to learn more.
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Learn More
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- Read our blogs and watch our videos
- Check out our 2040 grid page
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_00 (00:06):
Welcome to the Power Trends Podcast, produced by the
New York Independent SystemOperator, where we discuss
energy planning, public policy,and other issues affecting New
York's power grid.
SPEAKER_01 (00:20):
Hello, and welcome to another edition of the Power
Trends Podcast.
I am Kevin Lanahan with the NewYork Independent System
Operator.
In this episode, we bring backZach Smith.
Zach is a frequent andmuch-anticipated guest on the
Power Trends Podcast.
We haven't heard from you in awhile, for good reason.
You and your team have beenplenty busy.
Zach Smith heads up our systemand resource planning group.
(00:42):
And since his last visit with usat the podcast, he was very
deservedly promoted to seniorvice president.
So first, congratulations onthat.
SPEAKER_02 (00:51):
Thank you for that, Kevin.
Yeah, I'm happy to be here.
It speaks to the fantastic workthat the whole team is doing
right now.
And we're, as you say, quitebusy and interested to talk with
you about everything we'reworking on.
SPEAKER_01 (01:01):
We're going to talk about the Reliability Needs
Assessment, which at any momenthere as we speak is going to be
published on the NYISO website,nyiso.com.
As we've mentioned, Zach and hisgroup are the ones that are
focused in terms of the planningwork and the reliability studies
(01:22):
issued to the public on becomingthe authoritative source of
information.
that part of our mission thatserves in providing independent
data on the reliability of theNew York grid.
Zach, let's dive right in.
I think first, it's probablyhelpful if we talk about the
planning process, do a littlebit of a primer.
We've done that in previouspodcasts, the significant
(01:42):
elements of it, but then we'lltalk a little bit about the
specific role that the RNA, thereliability needs assessment
plays in that.
SPEAKER_02 (01:49):
Yeah, thanks, Kevin.
Really, our reliability planningprocess has evolved over time.
And what we're working on thisyear is our reliability needs
assessment.
It's looking out 10 years at thereliability of the grid based on
all of our forecasts of demand.
How does demand evolve overtime?
How does it evolve on aseason-by-season basis, looking
(02:11):
at summer, winter, everywhere inbetween, all the way out to 10
years?
taking into consideration whatcan we expect in the generation
fleet what can we expect interms of resources to serve all
of that demand over 10 years inaddition to the rna which we're
working on right now thenafterwards produce a
comprehensive reliability planthat'll be next year we also
(02:33):
conduct a quarterly short-termassessment of reliability so
every single quarter We producea report that looks out five
years and considers what haschanged within that past quarter
and how might that affect thereliability of the grid between
now and five years from now.
And the purpose of all of thatis to inform stakeholders,
(02:53):
inform policymakers, and alsogive us the ability to take
action if we see somedeficiency.
SPEAKER_01 (02:59):
Okay, that's perfect overview.
I think as we step through theRNA, some of the items that we
want to cover here, how youbuild it, like where's the data
come from and what do you dowith it in terms of the
modeling?
Probably a good thing to justkind of cover what the base case
set of assumptions are.
Take a look at the significanceof the increase in peak demand
over the study horizon.
(03:19):
How do you and your team gothrough loads of data from
various different sources?
Maybe step through that.
SPEAKER_02 (03:26):
Yeah, it's a very important part of our process is
the building of all of ourassumptions, the building of all
of our data.
And it may sound like atechnically nerdy thing.
And yeah, it is.
But hey, why not?
The reason it's so important isthe design of our process is to
consider one set of assumptions,one base case you'll hear us
(03:48):
describe.
And everything else we take alook at, but that base case set
of assumptions is what we thenhave the authority to take
action on if need be, if there'ssome deficiency for the
reliability of the grid over thenext 10 years.
So it really becomes vital whatgoes into that base case.
First and foremost, it startswith our demand forecast.
We have to consider how is thegrid going to be used over the
(04:11):
next number of years.
So of course, in the summertime,that includes a lot of air
conditioning, load you'll hearus describe as, all the
different uses that we all useon a day-to-day basis, the way
we use electricity.
In the winter, We see thatevolving in a very significant
fashion going forward.
And that in turn becomes a veryimportant assumption for the
(04:31):
reliability of the grid.
Primarily, the change that we'reseeing is the electrification of
heating and transportation inour society.
Today, as we know, I mean,transportation still is very
much primarily based on, youknow, fossil fuels, gasoline,
diesel, anything like that.
But there is a shift happeningto electric vehicles, and we
expect that shift to continuesignificantly through time.
(04:54):
In addition, here in New York,vast majority of our heating
comes from fossil fuels today.
But in the future, we do expecta shift towards electrification,
towards the use of heat pumps inhomes and other buildings to
then use the electric grid topower that heating rather than
directly fossil fuels in thehome.
(05:14):
All of that adds up to a muchmore significant demand on the
grid than what we're seeingtoday.
And not just a significantchange, but also the change in
the nature of that demand.
And on top of all of thatgeneral use, like what we can
all relate to on a home-by-homebasis or building-by-building
basis, we also are seeing in NewYork a significant economic
(05:36):
development of large loads thatwe call them.
They're really large facilities.
In the past, they would be largeindustrial facilities, but now
the change in technology,there's all different kinds of
demand on the system.
And that includes cloudcomputing, data centers,
artificial intelligence, andthen especially for New York,
something very important is chipfabrication from microchips.
(05:59):
All of that adds up to greaterdemand on the system, and it
factors in to our assumptionsfor our base case.
On the other side of theequation, if you will, we have
to worry about all of thatdemand.
How do you serve that demand?
So we consider what generationis going to be available to us
within the next 10 years.
We have our fleet today.
How is that fleet going tochange?
(06:21):
We have many new generatorscoming along in our
interconnection process, newwind, solar, storage, all kinds
of different technologies.
And we have many working theirway through our newly designed
interconnection process.
We expect much of that to comeonto the system.
For the purposes of ourreliability planning process, we
(06:42):
decide which ones are soadvanced that we can count on
them for the reliability of thegrid.
So intentionally, we're somewhatconservative in our assumptions
for what generation can beincluded in the RNA because we
don't want to gloss over areliability need.
We don't want to assumesomething that's going to be
there and then it's not therelater.
SPEAKER_01 (07:01):
Is it fair to say on the heels of that, that the
quarterly assessments provideyou that kind of flexibility to
shift if you do see somethingnew or impactful?
SPEAKER_02 (07:10):
That's absolutely right, Kevin.
That's the whole purpose of thequarterly process is to consider
what changes have we seen withinthat last quarter and to allow
us to be nimble, to makeadjustments to our system plans
and to react accordingly.
Of course, something that canhappen, does happen are
generator retirements, generatordeactivations, generator
(07:33):
outages, various things likethat.
And that tends to be the focusof those quarterly assessments.
What has changed with thegeneration fleet?
SPEAKER_01 (07:41):
So sounds like things are very dynamic.
The data is changing.
There's been some changes fromthe CRP a year ago.
And then there were changes fromaccording to the new data and
some other things that you werepicking up from the very first
drafts of this particular RNA.
Maybe step us through some ofthat, because I think that's
significant.
SPEAKER_02 (07:58):
That it is significant.
And it's important to understandthe nature of our process where
we want to be as realistic aspossible.
We want to understand as much aswe can understand prior to
publishing a final report.
So as you referenced, Kevin, inthis reliability needs
assessment, we've been workingwith stakeholders for many
months now, building up to thepublication of the RNA.
(08:19):
And a key milestone in themiddle of the process, roughly
July, is when we share ourpreliminary findings.
Part of the idea with thatpreliminary findings is to
invite further input fromstakeholders.
What can we understand better?
What do they see in our findingsthat maybe we need to take
further consideration of?
SPEAKER_01 (08:37):
I think that's probably also good to highlight
that it's a collaborativeprocess.
We're not going, you're not, youand your group aren't going away
and then coming out withsomething and saying, here it
is.
That's for sure.
Yeah.
SPEAKER_02 (08:47):
We really value the input of all of our
stakeholders.
I mean, we, you know, we, theNYSO, the NYSO staff, we don't
own any of these facilities.
We are not the developer of anyof these facilities.
We rely on the input of all ofthe businesses, all the
stakeholders, the people whoknow these facilities the best,
and take their input intoconsideration as to what the
(09:07):
system should be in the future.
So a key update that happened inthis cycle is the consideration
of these large loads of cloudcomputing, data centers,
microchip fabrication, not justwhich facilities might exist in
the future and which ones wequestion, but also how are they
gonna operate?
(09:27):
How are they going to use thegrid?
When are they going to use thegrid?
And this becomes very importantfor us planning the grid.
We have to consider the worstcase scenarios for usage of the
grid.
And that tends to be during peakdemand conditions.
So today we are a summer peakingsystem.
In the future, we expect to be awinter peaking system.
(09:48):
During those peak demandperiods, for example, in the
summer, when everyone's usingtheir air conditioning load,
Well, at the same time, what arethese other facilities going to
be doing?
Are they going to be at fulldemand?
Or instead, do they have theflexibility to possibly reduce
during those peak demandperiods?
And that becomes really vitalfor us to consider what's needed
for the reliability of the grid.
(10:09):
We learned partway through thisprocess, more details, more
operational characteristics ofsome of these facilities, such
that we were able to make whatwe believe is a reasonable
assumption that some of thesefacilities will reduce their
demand during these peak demandperiods.
And as a result, we found thatwe were able to avoid a
(10:30):
statewide reliability need outin the 10-year horizon, whereas
otherwise the preliminaryfindings were suggesting that we
might have a deficiencystatewide.
And
SPEAKER_01 (10:40):
this is a new area for you folks, considering these
large energy intensive loads,how they're going to operate,
how they anticipate they willoperate.
And when you say worst casescenario in terms of how the
system is going to behave andrespond to all of this peak
demand at once, your role is toensure that all of that peak
(11:00):
demand can, one, we have themegawatts in the system to
supply that.
And then two, the wires, thetransmission facility can move
those electrons around reliably.
I mean, those are two huge areasto investigate and get right.
And I think that that's whatyou're really driving at here.
You and your group have to getthat
SPEAKER_02 (11:20):
right.
There are huge pieces.
There are many differentvariables nowadays with the way
that the grid is evolvingcompared to what we had to deal
with even five years ago.
many different changes on thegrid and yes i mean one area
that's rapidly evolving arethese large loads are these are
these larger facilities and thecharacteristics of them it's a
rapidly growing industry cloudcomputing ai and then as well as
(11:42):
the microchip fabrication we'relearning more every day and then
that's reflected in our studiesand
SPEAKER_01 (11:48):
our stakeholder discussions so let's talk a bit
about the significance of winterdemand if i have this right the
increase in summer peak over thetime horizon, over the study
horizon, goes up marginally,negligibly, modestly.
Winter demand, however, is adifferent story.
(12:09):
This winter demand driven bythese new heat pumps to keep
people safe and warm through thewinter months, very different.
SPEAKER_02 (12:16):
It is very different.
And again, it is a forecast.
So the difference here is thatwe are anticipating the adoption
of these new technologies forheating.
the adoption of new electricvehicles, people replacing their
regular vehicles with electricvehicles.
So it's an assumption, but it'san assumption driven by data.
It's an assumption driven byinformation that we gather from
(12:38):
all different kinds of sourcesto try to understand consumer
behavior, what consumers willplan to do with their homes,
what businesses and buildingowners will do with their
buildings in the future, and totake that into account in our
forecasts.
Our forecasts may change, willchange, and we have to keep up
with those changes.
And that's the reason for thenature and structure of our
(13:00):
reliability planning process, tocontinue to revisit those
assumptions.
We have a certain understandingtoday.
I can guarantee you thatunderstanding will change over
time.
And it's a matter of beingresponsive to those changes.
So
SPEAKER_01 (13:13):
there's a lot of variability in the data.
And then on top of it, you'redoing your best to try and
establish what the future willlook like.
And then on top of that, we havethis new economic development
with all of the differentindustries that you mentioned
earlier.
How do we track that?
Your group has to get that partright too.
And there's a number offacilities that we know are
(13:35):
quote unquote in development,but how are you tracking those
large loads?
And I know there's also someinformational scenarios that
you're running in this report.
So maybe expound on some of thata little.
SPEAKER_02 (13:48):
Yes, certainly.
So we use every data source thatwe can find with regard to
understanding these loads,understanding their behavior.
So it starts working withpolicymakers, regulators,
utilities, getting the sameinformation that they have in
terms of larger projects,anything that's in the pipeline
coming forward so that we knowabout it, perhaps even before
(14:11):
the owner of the facilitydirectly contacts us.
Then any of these newfacilities, they also have to
work through what we call ourload interconnection process.
And through that process, weevaluate the reliability impact
of each individual facility andwhether or not there needs to be
some type of improvement to thegrid to allow them to reliably
(14:32):
interconnect.
Through that process, andgenerally through our demand
forecasting processes, wecontact each facility directly.
We understand the nature oftheir facility We understand how
they intend to operate.
We understand the phase-inschedule for their facility.
That becomes something veryimportant in our forecast.
It's not just about a date, aset date in the future when they
(14:56):
come into service, like anon-off switch.
Many of these facilities, theydevelop over time.
They phase in one part of thefacility, then another part of
the facility over a multi-yearperiod.
Especially the chip fabsemiconductor.
Yeah, absolutely.
So then that becomes animportant part of our forecast.
So from an information gatheringstandpoint, it's important that
(15:16):
we have that open communicationwith directly all of these
developers and facility ownersto understand how their project
is going, not just on the frontend when they first requested,
but also throughout thedevelopment of their facility
and then after its existence,you know, any changes that they
SPEAKER_01 (15:33):
make.
You touched earlier on the longrange findings.
The statewide reliability needwas avoided.
But it's looming.
Fair to say it still kind oflooms in the future.
It sure does.
So maybe, again, expound on thata bit, and then let's touch on
the New York City reliabilityneed that does reveal itself.
(15:54):
When that happens, why, and thenit'll be important to talk about
our regulatory role andresponsibilities in solving for
that.
SPEAKER_02 (16:02):
Yeah, happy to.
Those are all really importanttopics.
So on a statewide level, wedetermined that we do not
officially have a reliabilityneed on a statewide basis over
the next 10 years.
So that's looking out through2034.
That's the good news.
That's the good news.
However, in 2034, ourcalculations show that on a
statewide basis, taking all ofthe demand that we're
(16:24):
forecasting and the generationfleet that we are forecasting,
that we have a surplus of only50 megawatts.
That's very small on a systemthat's over 30,000 megawatts of
peak demand.
And so with such a smallsurplus, that could change with
any change of these assumptions.
(16:46):
It could change with a change inour demand forecast.
It could certainly change withregard to the generation mix
that we have in the future.
SPEAKER_01 (16:53):
So Zach, when we speak about the 50 megawatt
margin, which is razor thin, itsounds concerning.
What is a healthy reliabilitymargin if 50 megawatts is razor
thin?
SPEAKER_02 (17:04):
That's a fantastic question.
So first of all, when I say 50megawatts, it's already
factoring in many differentmargins that we already have.
So it factors in operatingreserves and many different
emergency operating proceduresthat are tools in the toolbox.
Demand response, public appeals,all different kinds of steps
(17:26):
like that.
that the operators have in theirtoolbox and it's evaluating,
okay, how would those get usedon a day-to-day basis and
especially on peak demand days?
And after all of that, how muchreserve do we have?
How much surplus do we have?
So when I say surplus, it trulyis surplus and it should not be
cause for concern in terms of anemergency.
(17:48):
Very different than that, again,what we see is we have a
forecasted increase in peakdemand, especially during the
winter periods, that starts toclimb significantly in the outer
years.
And that's really what isdriving that diminishing number.
In the nearer term years, thatnumber is much larger.
I've mentioned in the RNA, we domake some conservative
(18:11):
assumptions.
And the whole purpose is to makesure that we don't gloss over
reliability needs.
And so when we say a 50 megawattsurplus, It's only assuming a
certain amount of generationexpansion on the grid.
There are thousands andthousands and thousands of
megawatts of generation in thepipeline working through our
interconnection process that weactually are not yet planning
(18:32):
for in our reliability plans.
That's by design.
That's very intentional in theRNA report itself.
We have what we call scenarioanalysis.
And in those scenarios, we show,for example, what if you added
5,000 megawatts of projects thatwe're well aware of that are
working their way through theinterconnection process, or
perhaps have even completed theinterconnection process?
(18:54):
What if we added them into thesystem?
What does the system look like?
And the answer is that we have ahealthy surplus when they all
come online.
We're talking wind, solar,batteries, all different kinds
of projects.
So when they come online, we'rein much better shape.
Really, the whole purpose of theRNA is to highlight for people's
attention what the concern areasare, what areas need to keep
(19:16):
focus on, keep attention on, sothat we all can stay focused on
moving those right projectsforward to maintain reliability
in the future.
SPEAKER_01 (19:25):
When you say maintain reliability in this
context with everything thatcame before, what you're saying
is to make sure that we do notget ourselves close to a
situation where we have to takedrastic action and shed load et
cetera, as you're modeling, showsigns of teetering.
You and your group are takingresponsibility for digesting all
this data, running modeling sothat we don't get into those
(19:47):
situations.
SPEAKER_02 (19:48):
That's exactly it.
That's our whole purpose.
And to ultimately put as manytools in the toolbox as possible
for our operators so that whenthe day comes on a peak day, on
a stress day, they have all thetools that they need in order to
keep the lights on for NewYorkers.
SPEAKER_01 (20:03):
Okay.
So, but we do see...
reliability need reveal itselfin New York City, not for a
number of years, but walk usthrough some of that.
SPEAKER_02 (20:13):
Yeah.
So once we know that we havesufficient resources statewide,
we have to look in each portionof the New York grid.
And as you know, Kevin, we haveidentified a reliability need in
the New York City area, but thisreliability need is farther out
in time.
We identify that it first wouldoccur in 2033.
(20:34):
It grows to 97 megawattdeficiency in 2034.
In the grand scheme of things,that's not that much, but the
fact is it is a deficiency.
And really this is driven by awhole combination of changes in
the grid that we anticipate overthe next 10 years.
One of those changes is in thenear term, and we've talked
about it previously.
(20:55):
The DEC PICA rule calls formodification or retirement of
peakers within the city.
Peekers are smaller generatorsthat are used to serve demand at
those peak periods.
As we've talked aboutpreviously, we had to retain
them for a little bit longerbecause of certain deficiencies
that we previously identified inthe New York City area.
(21:17):
But also around a thousandmegawatts of these peakers were
retired.
Absolutely.
That's an excellent point.
Yeah.
There was a first round in 2023.
We were able to plan the systemsuch that those were allowed to
retire.
There's a smaller subset thatneeded to be retained, but the
whole point is to plan for thattransition.
(21:38):
We are relying heavily on a newdevelopment within New York City
that includes the development ofthe Champlain-Hudson Power
Express line coming down fromQuebec that will deliver
Canadian power into the New YorkCity area.
There is a reliability value tothat.
Once that comes in, proves itsavailability, proves its
performance.
then we will be able toreevaluate the status of those
(22:01):
peakers that needed to beretained.
And as a reminder, that's 1,250
SPEAKER_01 (22:05):
megawatts of hydro.
SPEAKER_02 (22:06):
That's correct.
Yeah, 1,250 injecting right intoNew York City.
Then looking out to the future,however, considering that we
have those plans in place forthe near term, we are planning
for those peakers to beunavailable after that period of
time.
So first of all, we have a stepdown in our surplus power in the
New York City area.
(22:27):
in that 2026 timeframe.
Then going forward, there'sanother projected change in the
New York City generationbalance.
And that is as a result oflegislation that requires the
New York Power Authority totransition certain other small
plants offline and transition toclean resources, basically, for
(22:48):
the New York City area.
The legislation requires thatthose units transition off by
the end of 2030 so that in 2031,we then again see a reduction in
the surplus power within the NewYork City area.
This combined with theforecasted demand in New York
City, that's what results in thedeficiency that we identify in
(23:10):
2033 that then grows to 97megawatts in 2034.
So really the whole purpose inour process here is to identify
that deficiency, identify why,and to then seek solutions so
that we don't in realityactually experience that
deficiency.
This deficiency in the New YorkCity area is driven by three
things.
One is the forecasted demandwithin the New York City area.
(23:34):
Two, the generation, theresources that are available
within the New York City area.
And three, the capability of thetransmission system to move
power into New York City fromother parts of the system.
And really, that means that thisdeficiency could be solved with
any three of those things.
You could reduce demand.
You could increase resources.
(23:56):
Or you could increase thecapability of the transmission
system to move power into theNew York City area.
And really our job movingforward is to then seek what
combination of those solutionsis really the right solution to
solve this issue.
As I mentioned previously, ourdemand forecasts are updated
regularly.
We're going to take another lookat those in the next number of
(24:16):
months to see whether in factthis is a real deficiency or do
we think maybe it's dropped alittle bit.
Resource-wise, what newresources might meet our
inclusion rules such that we canplan for them?
Transmission-wise, what othertransmission projects might be
on the horizon that could help?
SPEAKER_01 (24:33):
When you ran the process for solving the nearer
term New York City reliabilityneed, we said it could be a
suite of solutions.
So it can be a combination ofsome of those elements that you
raised, renewables, demandresponse.
Additional transmission, etcetera.
That's right.
SPEAKER_02 (24:51):
It doesn't have to be all of one.
It can be any combination ofthose.
In engineering speak, it's allone equation that has to add up
in the end.
Demand has to equal resourcesplus transmission.
SPEAKER_01 (25:02):
Before we leave it there, I think it's probably
also important to mention someof the other informational
scenarios you run.
So you're not just takingresources out and you put it
very conservative in yourapproach.
You do construct theseinformational scenarios in
recognition of the variabilityin the data, but then also the
(25:24):
variability in what resourcedevelopment might show us.
So you include offshore wind,for instance, include other
renewables.
Let's talk about that, why thoseinformational scenarios are so
important in that variabilityenvironment that you're working
in and how much of thoseresources you are modeling in
anticipation of the change inthe future.
SPEAKER_02 (25:45):
Yeah, the scenarios are very important in my mind.
So as I described earlier, froma process perspective, we have a
quote unquote base case that wedesign the system to, that we
act upon.
But to me, something that'sincredibly informative is to
consider everything that couldchange about those base case
assumptions.
And that's what our scenariosare.
So especially with regard toinforming any potential
(26:08):
solutions in the future, whetherit's on a statewide basis or on
a New York City basis oranywhere else on the system that
we may have a reliability needor a reliability concern, is to
understand, well, what could bethe impact that could change
that finding?
And so we look at, on thepositive side, scenarios that
look at additional resourcesfrom our interconnection
(26:28):
process, scenarios that look atfurther offshore wind
development and what impactcould all of that have.
What if there was greater demandresponse in the future?
We have all kinds of differentevolving technologies and
demands on the demand side ofour grid.
How might that change in thefuture?
And if there is greaterflexibility, if there is more of
(26:50):
a responsiveness to the demandunder peak conditions, what
impact does that have?
We have those various scenariosin there.
We also look at what if moregeneration was available to us
from a fuel availabilitystandpoint.
Part of the reason that we werecoming up with so many concerns
in the wintertime is theimplementation of a new rule
(27:11):
that requires us to evaluate thepotential unavailability of
non-firm gas-only generationduring the wintertime.
This is because in the wintertoday, Our heating is primarily
supplied by natural gas in NewYork, and that heating gas
supply gets priority over anygas that would be delivered to
(27:33):
electric generation.
So then in turn, the concern is,well, what if electric
generation may not be availableduring the winter peak periods
when everyone needs it to heattheir homes, heat their
buildings?
So the concept in our planningis to make sure to plan the
system to be reliable underwinter peak conditions with that
generation available.
SPEAKER_01 (27:52):
And we've seen the system react in that way that
you just described, Winter StormElliott, the vortex of last
year.
We saw some constraints on thesystem delivering gas that
ultimately would go to thegenerators to produce the
electricity that people aregoing to need in the future, as
you're putting it.
for the electric key.
More and more,
SPEAKER_02 (28:09):
our operators are experiencing these stresses
during the winter period.
And so that's where it's our jobas planners is to plan a grid
that can maintain reliability.
And that really was the idea andthe driver behind this new
reliability rule put forward bythe New York State Reliability
Council.
And so that's what we'replanning based on our
assumptions in terms of how muchgeneration might be unavailable,
(28:31):
how much of that gas generationcould come back in What would it
take in order for us to havesufficient margins, sufficient
supply, a healthy surplus towhat we were discussing before?
What would it take for that toget better?
So that's one of the scenariosthat we looked at.
On the other side of theequation, some other scenarios
we looked at as well for ourdemand forecast.
What if our demand forecast endsup being higher in the future
(28:55):
than what we have today?
What impact would that have?
We also looked at, I mentionedfor New York City, the reliance
on Champlain-Hudson PowerExpress.
Well, importantly, we looked atwhat if that's not available to
us, what impact does that haveto New York City?
What impact does that have tothe state?
And we looked at loadflexibility and what would the
grid experience if the largeloads that I described are not
(29:17):
as flexible as we're assuming.
So it's important for us to lookin both directions and to
understand how could this bebetter?
How could it be worse?
And then to make decisionsaccordingly.
And importantly, again, toinform policymakers and inform
stakeholders as to what theyneed to watch for and be
concerned about.
SPEAKER_01 (29:34):
Just to pick a couple of details.
On one side, you're sayinghere's 5,000 megawatts of new
resources or 7,000 megawatts ofoffshore wind.
And on the other side?
Here is if Champlain-Hudson getsdelayed or is not working.
That's right.
And then that shows you andultimately policymakers a
breadth and wide scope ofpossibilities.
(29:55):
That's exactly the intention.
Zach, once again, a wealth ofimportant information you've
distilled down for us, anunderstanding of this complex
process, and then the importanceof the reliability needs
assessment itself, the findingsthat you're putting out.
Can't thank you enough forcoming by.
Of course, we're going to haveyou come by again.
There's lots of other thingsthat you and your group are
(30:17):
working on, including the NewYork City PPTN, which will be
likely another subject that wewant to cover in the future.
But as always, thank you forcoming by.
Always
SPEAKER_02 (30:26):
happy to be here, Kevin.
I look forward to it next time.
Thank you.
SPEAKER_00 (30:32):
Thank you for joining us.
As a reminder, the New YorkIndependent System Operator,
NISO for short, is responsiblefor reliably managing New York's
power grid and energy marketsand providing independent data
to policymakers and the public.
For more independent info,please visit the NISO blog at
www.nyiso.com.
Welcome to the Power Trends Podcast, produced by the
New York Independent SystemOperator, where we discuss
energy planning, public policy,and other issues affecting New
York's power grid.
SPEAKER_01 (00:20):
Hello, and welcome to another edition of the Power
Trends Podcast.
I am Kevin Lanahan with the NewYork Independent System
Operator.
In this episode, we bring backZach Smith.
Zach is a frequent andmuch-anticipated guest on the
Power Trends Podcast.
We haven't heard from you in awhile, for good reason.
You and your team have beenplenty busy.
Zach Smith heads up our systemand resource planning group.
(00:42):
And since his last visit with usat the podcast, he was very
deservedly promoted to seniorvice president.
So first, congratulations onthat.
SPEAKER_02 (00:51):
Thank you for that, Kevin.
Yeah, I'm happy to be here.
It speaks to the fantastic workthat the whole team is doing
right now.
And we're, as you say, quitebusy and interested to talk with
you about everything we'reworking on.
SPEAKER_01 (01:01):
We're going to talk about the Reliability Needs
Assessment, which at any momenthere as we speak is going to be
published on the NYISO website,nyiso.com.
As we've mentioned, Zach and hisgroup are the ones that are
focused in terms of the planningwork and the reliability studies
(01:22):
issued to the public on becomingthe authoritative source of
information.
that part of our mission thatserves in providing independent
data on the reliability of theNew York grid.
Zach, let's dive right in.
I think first, it's probablyhelpful if we talk about the
planning process, do a littlebit of a primer.
We've done that in previouspodcasts, the significant
(01:42):
elements of it, but then we'lltalk a little bit about the
specific role that the RNA, thereliability needs assessment
plays in that.
SPEAKER_02 (01:49):
Yeah, thanks, Kevin.
Really, our reliability planningprocess has evolved over time.
And what we're working on thisyear is our reliability needs
assessment.
It's looking out 10 years at thereliability of the grid based on
all of our forecasts of demand.
How does demand evolve overtime?
How does it evolve on aseason-by-season basis, looking
(02:11):
at summer, winter, everywhere inbetween, all the way out to 10
years?
taking into consideration whatcan we expect in the generation
fleet what can we expect interms of resources to serve all
of that demand over 10 years inaddition to the rna which we're
working on right now thenafterwards produce a
comprehensive reliability planthat'll be next year we also
(02:33):
conduct a quarterly short-termassessment of reliability so
every single quarter We producea report that looks out five
years and considers what haschanged within that past quarter
and how might that affect thereliability of the grid between
now and five years from now.
And the purpose of all of thatis to inform stakeholders,
(02:53):
inform policymakers, and alsogive us the ability to take
action if we see somedeficiency.
SPEAKER_01 (02:59):
Okay, that's perfect overview.
I think as we step through theRNA, some of the items that we
want to cover here, how youbuild it, like where's the data
come from and what do you dowith it in terms of the
modeling?
Probably a good thing to justkind of cover what the base case
set of assumptions are.
Take a look at the significanceof the increase in peak demand
over the study horizon.
(03:19):
How do you and your team gothrough loads of data from
various different sources?
Maybe step through that.
SPEAKER_02 (03:26):
Yeah, it's a very important part of our process is
the building of all of ourassumptions, the building of all
of our data.
And it may sound like atechnically nerdy thing.
And yeah, it is.
But hey, why not?
The reason it's so important isthe design of our process is to
consider one set of assumptions,one base case you'll hear us
(03:48):
describe.
And everything else we take alook at, but that base case set
of assumptions is what we thenhave the authority to take
action on if need be, if there'ssome deficiency for the
reliability of the grid over thenext 10 years.
So it really becomes vital whatgoes into that base case.
First and foremost, it startswith our demand forecast.
We have to consider how is thegrid going to be used over the
(04:11):
next number of years.
So of course, in the summertime,that includes a lot of air
conditioning, load you'll hearus describe as, all the
different uses that we all useon a day-to-day basis, the way
we use electricity.
In the winter, We see thatevolving in a very significant
fashion going forward.
And that in turn becomes a veryimportant assumption for the
(04:31):
reliability of the grid.
Primarily, the change that we'reseeing is the electrification of
heating and transportation inour society.
Today, as we know, I mean,transportation still is very
much primarily based on, youknow, fossil fuels, gasoline,
diesel, anything like that.
But there is a shift happeningto electric vehicles, and we
expect that shift to continuesignificantly through time.
(04:54):
In addition, here in New York,vast majority of our heating
comes from fossil fuels today.
But in the future, we do expecta shift towards electrification,
towards the use of heat pumps inhomes and other buildings to
then use the electric grid topower that heating rather than
directly fossil fuels in thehome.
(05:14):
All of that adds up to a muchmore significant demand on the
grid than what we're seeingtoday.
And not just a significantchange, but also the change in
the nature of that demand.
And on top of all of thatgeneral use, like what we can
all relate to on a home-by-homebasis or building-by-building
basis, we also are seeing in NewYork a significant economic
(05:36):
development of large loads thatwe call them.
They're really large facilities.
In the past, they would be largeindustrial facilities, but now
the change in technology,there's all different kinds of
demand on the system.
And that includes cloudcomputing, data centers,
artificial intelligence, andthen especially for New York,
something very important is chipfabrication from microchips.
(05:59):
All of that adds up to greaterdemand on the system, and it
factors in to our assumptionsfor our base case.
On the other side of theequation, if you will, we have
to worry about all of thatdemand.
How do you serve that demand?
So we consider what generationis going to be available to us
within the next 10 years.
We have our fleet today.
How is that fleet going tochange?
(06:21):
We have many new generatorscoming along in our
interconnection process, newwind, solar, storage, all kinds
of different technologies.
And we have many working theirway through our newly designed
interconnection process.
We expect much of that to comeonto the system.
For the purposes of ourreliability planning process, we
(06:42):
decide which ones are soadvanced that we can count on
them for the reliability of thegrid.
So intentionally, we're somewhatconservative in our assumptions
for what generation can beincluded in the RNA because we
don't want to gloss over areliability need.
We don't want to assumesomething that's going to be
there and then it's not therelater.
SPEAKER_01 (07:01):
Is it fair to say on the heels of that, that the
quarterly assessments provideyou that kind of flexibility to
shift if you do see somethingnew or impactful?
SPEAKER_02 (07:10):
That's absolutely right, Kevin.
That's the whole purpose of thequarterly process is to consider
what changes have we seen withinthat last quarter and to allow
us to be nimble, to makeadjustments to our system plans
and to react accordingly.
Of course, something that canhappen, does happen are
generator retirements, generatordeactivations, generator
(07:33):
outages, various things likethat.
And that tends to be the focusof those quarterly assessments.
What has changed with thegeneration fleet?
SPEAKER_01 (07:41):
So sounds like things are very dynamic.
The data is changing.
There's been some changes fromthe CRP a year ago.
And then there were changes fromaccording to the new data and
some other things that you werepicking up from the very first
drafts of this particular RNA.
Maybe step us through some ofthat, because I think that's
significant.
SPEAKER_02 (07:58):
That it is significant.
And it's important to understandthe nature of our process where
we want to be as realistic aspossible.
We want to understand as much aswe can understand prior to
publishing a final report.
So as you referenced, Kevin, inthis reliability needs
assessment, we've been workingwith stakeholders for many
months now, building up to thepublication of the RNA.
(08:19):
And a key milestone in themiddle of the process, roughly
July, is when we share ourpreliminary findings.
Part of the idea with thatpreliminary findings is to
invite further input fromstakeholders.
What can we understand better?
What do they see in our findingsthat maybe we need to take
further consideration of?
SPEAKER_01 (08:37):
I think that's probably also good to highlight
that it's a collaborativeprocess.
We're not going, you're not, youand your group aren't going away
and then coming out withsomething and saying, here it
is.
That's for sure.
Yeah.
SPEAKER_02 (08:47):
We really value the input of all of our
stakeholders.
I mean, we, you know, we, theNYSO, the NYSO staff, we don't
own any of these facilities.
We are not the developer of anyof these facilities.
We rely on the input of all ofthe businesses, all the
stakeholders, the people whoknow these facilities the best,
and take their input intoconsideration as to what the
(09:07):
system should be in the future.
So a key update that happened inthis cycle is the consideration
of these large loads of cloudcomputing, data centers,
microchip fabrication, not justwhich facilities might exist in
the future and which ones wequestion, but also how are they
gonna operate?
(09:27):
How are they going to use thegrid?
When are they going to use thegrid?
And this becomes very importantfor us planning the grid.
We have to consider the worstcase scenarios for usage of the
grid.
And that tends to be during peakdemand conditions.
So today we are a summer peakingsystem.
In the future, we expect to be awinter peaking system.
(09:48):
During those peak demandperiods, for example, in the
summer, when everyone's usingtheir air conditioning load,
Well, at the same time, what arethese other facilities going to
be doing?
Are they going to be at fulldemand?
Or instead, do they have theflexibility to possibly reduce
during those peak demandperiods?
And that becomes really vitalfor us to consider what's needed
for the reliability of the grid.
(10:09):
We learned partway through thisprocess, more details, more
operational characteristics ofsome of these facilities, such
that we were able to make whatwe believe is a reasonable
assumption that some of thesefacilities will reduce their
demand during these peak demandperiods.
And as a result, we found thatwe were able to avoid a
(10:30):
statewide reliability need outin the 10-year horizon, whereas
otherwise the preliminaryfindings were suggesting that we
might have a deficiencystatewide.
And
SPEAKER_01 (10:40):
this is a new area for you folks, considering these
large energy intensive loads,how they're going to operate,
how they anticipate they willoperate.
And when you say worst casescenario in terms of how the
system is going to behave andrespond to all of this peak
demand at once, your role is toensure that all of that peak
(11:00):
demand can, one, we have themegawatts in the system to
supply that.
And then two, the wires, thetransmission facility can move
those electrons around reliably.
I mean, those are two huge areasto investigate and get right.
And I think that that's whatyou're really driving at here.
You and your group have to getthat
SPEAKER_02 (11:20):
right.
There are huge pieces.
There are many differentvariables nowadays with the way
that the grid is evolvingcompared to what we had to deal
with even five years ago.
many different changes on thegrid and yes i mean one area
that's rapidly evolving arethese large loads are these are
these larger facilities and thecharacteristics of them it's a
rapidly growing industry cloudcomputing ai and then as well as
(11:42):
the microchip fabrication we'relearning more every day and then
that's reflected in our studiesand
SPEAKER_01 (11:48):
our stakeholder discussions so let's talk a bit
about the significance of winterdemand if i have this right the
increase in summer peak over thetime horizon, over the study
horizon, goes up marginally,negligibly, modestly.
Winter demand, however, is adifferent story.
(12:09):
This winter demand driven bythese new heat pumps to keep
people safe and warm through thewinter months, very different.
SPEAKER_02 (12:16):
It is very different.
And again, it is a forecast.
So the difference here is thatwe are anticipating the adoption
of these new technologies forheating.
the adoption of new electricvehicles, people replacing their
regular vehicles with electricvehicles.
So it's an assumption, but it'san assumption driven by data.
It's an assumption driven byinformation that we gather from
(12:38):
all different kinds of sourcesto try to understand consumer
behavior, what consumers willplan to do with their homes,
what businesses and buildingowners will do with their
buildings in the future, and totake that into account in our
forecasts.
Our forecasts may change, willchange, and we have to keep up
with those changes.
And that's the reason for thenature and structure of our
(13:00):
reliability planning process, tocontinue to revisit those
assumptions.
We have a certain understandingtoday.
I can guarantee you thatunderstanding will change over
time.
And it's a matter of beingresponsive to those changes.
So
SPEAKER_01 (13:13):
there's a lot of variability in the data.
And then on top of it, you'redoing your best to try and
establish what the future willlook like.
And then on top of that, we havethis new economic development
with all of the differentindustries that you mentioned
earlier.
How do we track that?
Your group has to get that partright too.
And there's a number offacilities that we know are
(13:35):
quote unquote in development,but how are you tracking those
large loads?
And I know there's also someinformational scenarios that
you're running in this report.
So maybe expound on some of thata little.
SPEAKER_02 (13:48):
Yes, certainly.
So we use every data source thatwe can find with regard to
understanding these loads,understanding their behavior.
So it starts working withpolicymakers, regulators,
utilities, getting the sameinformation that they have in
terms of larger projects,anything that's in the pipeline
coming forward so that we knowabout it, perhaps even before
(14:11):
the owner of the facilitydirectly contacts us.
Then any of these newfacilities, they also have to
work through what we call ourload interconnection process.
And through that process, weevaluate the reliability impact
of each individual facility andwhether or not there needs to be
some type of improvement to thegrid to allow them to reliably
(14:32):
interconnect.
Through that process, andgenerally through our demand
forecasting processes, wecontact each facility directly.
We understand the nature oftheir facility We understand how
they intend to operate.
We understand the phase-inschedule for their facility.
That becomes something veryimportant in our forecast.
It's not just about a date, aset date in the future when they
(14:56):
come into service, like anon-off switch.
Many of these facilities, theydevelop over time.
They phase in one part of thefacility, then another part of
the facility over a multi-yearperiod.
Especially the chip fabsemiconductor.
Yeah, absolutely.
So then that becomes animportant part of our forecast.
So from an information gatheringstandpoint, it's important that
(15:16):
we have that open communicationwith directly all of these
developers and facility ownersto understand how their project
is going, not just on the frontend when they first requested,
but also throughout thedevelopment of their facility
and then after its existence,you know, any changes that they
SPEAKER_01 (15:33):
make.
You touched earlier on the longrange findings.
The statewide reliability needwas avoided.
But it's looming.
Fair to say it still kind oflooms in the future.
It sure does.
So maybe, again, expound on thata bit, and then let's touch on
the New York City reliabilityneed that does reveal itself.
(15:54):
When that happens, why, and thenit'll be important to talk about
our regulatory role andresponsibilities in solving for
that.
SPEAKER_02 (16:02):
Yeah, happy to.
Those are all really importanttopics.
So on a statewide level, wedetermined that we do not
officially have a reliabilityneed on a statewide basis over
the next 10 years.
So that's looking out through2034.
That's the good news.
That's the good news.
However, in 2034, ourcalculations show that on a
statewide basis, taking all ofthe demand that we're
(16:24):
forecasting and the generationfleet that we are forecasting,
that we have a surplus of only50 megawatts.
That's very small on a systemthat's over 30,000 megawatts of
peak demand.
And so with such a smallsurplus, that could change with
any change of these assumptions.
(16:46):
It could change with a change inour demand forecast.
It could certainly change withregard to the generation mix
that we have in the future.
SPEAKER_01 (16:53):
So Zach, when we speak about the 50 megawatt
margin, which is razor thin, itsounds concerning.
What is a healthy reliabilitymargin if 50 megawatts is razor
thin?
SPEAKER_02 (17:04):
That's a fantastic question.
So first of all, when I say 50megawatts, it's already
factoring in many differentmargins that we already have.
So it factors in operatingreserves and many different
emergency operating proceduresthat are tools in the toolbox.
Demand response, public appeals,all different kinds of steps
(17:26):
like that.
that the operators have in theirtoolbox and it's evaluating,
okay, how would those get usedon a day-to-day basis and
especially on peak demand days?
And after all of that, how muchreserve do we have?
How much surplus do we have?
So when I say surplus, it trulyis surplus and it should not be
cause for concern in terms of anemergency.
(17:48):
Very different than that, again,what we see is we have a
forecasted increase in peakdemand, especially during the
winter periods, that starts toclimb significantly in the outer
years.
And that's really what isdriving that diminishing number.
In the nearer term years, thatnumber is much larger.
I've mentioned in the RNA, we domake some conservative
(18:11):
assumptions.
And the whole purpose is to makesure that we don't gloss over
reliability needs.
And so when we say a 50 megawattsurplus, It's only assuming a
certain amount of generationexpansion on the grid.
There are thousands andthousands and thousands of
megawatts of generation in thepipeline working through our
interconnection process that weactually are not yet planning
(18:32):
for in our reliability plans.
That's by design.
That's very intentional in theRNA report itself.
We have what we call scenarioanalysis.
And in those scenarios, we show,for example, what if you added
5,000 megawatts of projects thatwe're well aware of that are
working their way through theinterconnection process, or
perhaps have even completed theinterconnection process?
(18:54):
What if we added them into thesystem?
What does the system look like?
And the answer is that we have ahealthy surplus when they all
come online.
We're talking wind, solar,batteries, all different kinds
of projects.
So when they come online, we'rein much better shape.
Really, the whole purpose of theRNA is to highlight for people's
attention what the concern areasare, what areas need to keep
(19:16):
focus on, keep attention on, sothat we all can stay focused on
moving those right projectsforward to maintain reliability
in the future.
SPEAKER_01 (19:25):
When you say maintain reliability in this
context with everything thatcame before, what you're saying
is to make sure that we do notget ourselves close to a
situation where we have to takedrastic action and shed load et
cetera, as you're modeling, showsigns of teetering.
You and your group are takingresponsibility for digesting all
this data, running modeling sothat we don't get into those
(19:47):
situations.
SPEAKER_02 (19:48):
That's exactly it.
That's our whole purpose.
And to ultimately put as manytools in the toolbox as possible
for our operators so that whenthe day comes on a peak day, on
a stress day, they have all thetools that they need in order to
keep the lights on for NewYorkers.
SPEAKER_01 (20:03):
Okay.
So, but we do see...
reliability need reveal itselfin New York City, not for a
number of years, but walk usthrough some of that.
SPEAKER_02 (20:13):
Yeah.
So once we know that we havesufficient resources statewide,
we have to look in each portionof the New York grid.
And as you know, Kevin, we haveidentified a reliability need in
the New York City area, but thisreliability need is farther out
in time.
We identify that it first wouldoccur in 2033.
(20:34):
It grows to 97 megawattdeficiency in 2034.
In the grand scheme of things,that's not that much, but the
fact is it is a deficiency.
And really this is driven by awhole combination of changes in
the grid that we anticipate overthe next 10 years.
One of those changes is in thenear term, and we've talked
about it previously.
(20:55):
The DEC PICA rule calls formodification or retirement of
peakers within the city.
Peekers are smaller generatorsthat are used to serve demand at
those peak periods.
As we've talked aboutpreviously, we had to retain
them for a little bit longerbecause of certain deficiencies
that we previously identified inthe New York City area.
(21:17):
But also around a thousandmegawatts of these peakers were
retired.
Absolutely.
That's an excellent point.
Yeah.
There was a first round in 2023.
We were able to plan the systemsuch that those were allowed to
retire.
There's a smaller subset thatneeded to be retained, but the
whole point is to plan for thattransition.
(21:38):
We are relying heavily on a newdevelopment within New York City
that includes the development ofthe Champlain-Hudson Power
Express line coming down fromQuebec that will deliver
Canadian power into the New YorkCity area.
There is a reliability value tothat.
Once that comes in, proves itsavailability, proves its
performance.
then we will be able toreevaluate the status of those
(22:01):
peakers that needed to beretained.
And as a reminder, that's 1,250
SPEAKER_01 (22:05):
megawatts of hydro.
SPEAKER_02 (22:06):
That's correct.
Yeah, 1,250 injecting right intoNew York City.
Then looking out to the future,however, considering that we
have those plans in place forthe near term, we are planning
for those peakers to beunavailable after that period of
time.
So first of all, we have a stepdown in our surplus power in the
New York City area.
(22:27):
in that 2026 timeframe.
Then going forward, there'sanother projected change in the
New York City generationbalance.
And that is as a result oflegislation that requires the
New York Power Authority totransition certain other small
plants offline and transition toclean resources, basically, for
(22:48):
the New York City area.
The legislation requires thatthose units transition off by
the end of 2030 so that in 2031,we then again see a reduction in
the surplus power within the NewYork City area.
This combined with theforecasted demand in New York
City, that's what results in thedeficiency that we identify in
(23:10):
2033 that then grows to 97megawatts in 2034.
So really the whole purpose inour process here is to identify
that deficiency, identify why,and to then seek solutions so
that we don't in realityactually experience that
deficiency.
This deficiency in the New YorkCity area is driven by three
things.
One is the forecasted demandwithin the New York City area.
(23:34):
Two, the generation, theresources that are available
within the New York City area.
And three, the capability of thetransmission system to move
power into New York City fromother parts of the system.
And really, that means that thisdeficiency could be solved with
any three of those things.
You could reduce demand.
You could increase resources.
(23:56):
Or you could increase thecapability of the transmission
system to move power into theNew York City area.
And really our job movingforward is to then seek what
combination of those solutionsis really the right solution to
solve this issue.
As I mentioned previously, ourdemand forecasts are updated
regularly.
We're going to take another lookat those in the next number of
(24:16):
months to see whether in factthis is a real deficiency or do
we think maybe it's dropped alittle bit.
Resource-wise, what newresources might meet our
inclusion rules such that we canplan for them?
Transmission-wise, what othertransmission projects might be
on the horizon that could help?
SPEAKER_01 (24:33):
When you ran the process for solving the nearer
term New York City reliabilityneed, we said it could be a
suite of solutions.
So it can be a combination ofsome of those elements that you
raised, renewables, demandresponse.
Additional transmission, etcetera.
That's right.
SPEAKER_02 (24:51):
It doesn't have to be all of one.
It can be any combination ofthose.
In engineering speak, it's allone equation that has to add up
in the end.
Demand has to equal resourcesplus transmission.
SPEAKER_01 (25:02):
Before we leave it there, I think it's probably
also important to mention someof the other informational
scenarios you run.
So you're not just takingresources out and you put it
very conservative in yourapproach.
You do construct theseinformational scenarios in
recognition of the variabilityin the data, but then also the
(25:24):
variability in what resourcedevelopment might show us.
So you include offshore wind,for instance, include other
renewables.
Let's talk about that, why thoseinformational scenarios are so
important in that variabilityenvironment that you're working
in and how much of thoseresources you are modeling in
anticipation of the change inthe future.
SPEAKER_02 (25:45):
Yeah, the scenarios are very important in my mind.
So as I described earlier, froma process perspective, we have a
quote unquote base case that wedesign the system to, that we
act upon.
But to me, something that'sincredibly informative is to
consider everything that couldchange about those base case
assumptions.
And that's what our scenariosare.
So especially with regard toinforming any potential
(26:08):
solutions in the future, whetherit's on a statewide basis or on
a New York City basis oranywhere else on the system that
we may have a reliability needor a reliability concern, is to
understand, well, what could bethe impact that could change
that finding?
And so we look at, on thepositive side, scenarios that
look at additional resourcesfrom our interconnection
(26:28):
process, scenarios that look atfurther offshore wind
development and what impactcould all of that have.
What if there was greater demandresponse in the future?
We have all kinds of differentevolving technologies and
demands on the demand side ofour grid.
How might that change in thefuture?
And if there is greaterflexibility, if there is more of
(26:50):
a responsiveness to the demandunder peak conditions, what
impact does that have?
We have those various scenariosin there.
We also look at what if moregeneration was available to us
from a fuel availabilitystandpoint.
Part of the reason that we werecoming up with so many concerns
in the wintertime is theimplementation of a new rule
(27:11):
that requires us to evaluate thepotential unavailability of
non-firm gas-only generationduring the wintertime.
This is because in the wintertoday, Our heating is primarily
supplied by natural gas in NewYork, and that heating gas
supply gets priority over anygas that would be delivered to
(27:33):
electric generation.
So then in turn, the concern is,well, what if electric
generation may not be availableduring the winter peak periods
when everyone needs it to heattheir homes, heat their
buildings?
So the concept in our planningis to make sure to plan the
system to be reliable underwinter peak conditions with that
generation available.
SPEAKER_01 (27:52):
And we've seen the system react in that way that
you just described, Winter StormElliott, the vortex of last
year.
We saw some constraints on thesystem delivering gas that
ultimately would go to thegenerators to produce the
electricity that people aregoing to need in the future, as
you're putting it.
for the electric key.
More and more,
SPEAKER_02 (28:09):
our operators are experiencing these stresses
during the winter period.
And so that's where it's our jobas planners is to plan a grid
that can maintain reliability.
And that really was the idea andthe driver behind this new
reliability rule put forward bythe New York State Reliability
Council.
And so that's what we'replanning based on our
assumptions in terms of how muchgeneration might be unavailable,
(28:31):
how much of that gas generationcould come back in What would it
take in order for us to havesufficient margins, sufficient
supply, a healthy surplus towhat we were discussing before?
What would it take for that toget better?
So that's one of the scenariosthat we looked at.
On the other side of theequation, some other scenarios
we looked at as well for ourdemand forecast.
What if our demand forecast endsup being higher in the future
(28:55):
than what we have today?
What impact would that have?
We also looked at, I mentionedfor New York City, the reliance
on Champlain-Hudson PowerExpress.
Well, importantly, we looked atwhat if that's not available to
us, what impact does that haveto New York City?
What impact does that have tothe state?
And we looked at loadflexibility and what would the
grid experience if the largeloads that I described are not
(29:17):
as flexible as we're assuming.
So it's important for us to lookin both directions and to
understand how could this bebetter?
How could it be worse?
And then to make decisionsaccordingly.
And importantly, again, toinform policymakers and inform
stakeholders as to what theyneed to watch for and be
concerned about.
SPEAKER_01 (29:34):
Just to pick a couple of details.
On one side, you're sayinghere's 5,000 megawatts of new
resources or 7,000 megawatts ofoffshore wind.
And on the other side?
Here is if Champlain-Hudson getsdelayed or is not working.
That's right.
And then that shows you andultimately policymakers a
breadth and wide scope ofpossibilities.
(29:55):
That's exactly the intention.
Zach, once again, a wealth ofimportant information you've
distilled down for us, anunderstanding of this complex
process, and then the importanceof the reliability needs
assessment itself, the findingsthat you're putting out.
Can't thank you enough forcoming by.
Of course, we're going to haveyou come by again.
There's lots of other thingsthat you and your group are
(30:17):
working on, including the NewYork City PPTN, which will be
likely another subject that wewant to cover in the future.
But as always, thank you forcoming by.
Always
SPEAKER_02 (30:26):
happy to be here, Kevin.
I look forward to it next time.
Thank you.
SPEAKER_00 (30:32):
Thank you for joining us.
As a reminder, the New YorkIndependent System Operator,
NISO for short, is responsiblefor reliably managing New York's
power grid and energy marketsand providing independent data
to policymakers and the public.
For more independent info,please visit the NISO blog at
www.nyiso.com.
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