Electricity Price Forecast Sensitivity Analysis

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Electricity Price Forecast Sensitivity Analysis

• Jeff King
• Regional Technical Forum
• January 9, 2001

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Basic Assumptions

• New projects are developed by private,
  independent developers
• Projects under construction are completed
  additional projects are market-driven.
• Projects scheduled for retirement are retired
  additional retirements are market-driven.
• Constant Mean Price water conditions.
• Average loads.
• No transmission upgrades.
• Pre-ISO transmission rates (pancaked).
• Bid margin set at 5 of variable cost.
• Operating reserves set at 6.5.

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RTF Sensitivity Study Assumptions

• Natural gas Prices
• Request NYMEX futures contracts in near-term
  3.75/MMBtu by end of study period.
• This run as requested.
• Renewables incentives/environmental externalities
• Request 2 c/kWh renewables incentive phased to
  equivalent CO2 tax 2005 - 2015.
• This run 1.5 c/kWh renewables incentive phased
  to 20/ton CO2 tax 2005 - 2015.
• NOx Offsets
• Request NOx offset prices consistent with
  current offset market.
• This run AR study assumptions (0.80 cents/lb,
  all hours)

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Gas Price Forecast (Henry Hub)
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Forecast Resource Development Pacific Northwest
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Forecast Resource Development WSCC
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Forecast Mid-Columbia Prices
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Levelized Mid-Columbia Forecasts
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Four-segment Monthly Averages
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Comparison of Monthly Averages