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HomeMy WebLinkAboutStaff Report 2401-2508Item No. {{item.number}}. Page 1 of 8 Utilities Advisory Commission Staff Report From: Dean Batchelor, Director Utilities Lead Department: Utilities Meeting Date: February 7, 2024 Staff Report: 2401-2508 TITLE Discussion of Electric Grid Modernization Plan RECOMMENDATION This memorandum and presentation are for discussion purposes only; no action is requested at this time. EXECUTIVE SUMMARY The City of Palo Alto’s Electric Grid Modernization for Community-Wide Electrification Project (Grid Mod Project) was developed to enhance the distribution system’s grid resiliency and reliability in a manner that will continue to accelerate the City’s clean energy and decarbonization goals. Palo Alto’s grid must be modernized to reach the capacity required to electrify all homes and cars. The modernized system will be designed to fully accommodate energy received from local generation such as rooftop solar and battery storage, an important element in decarbonization goals. There will be an upgrade to the distribution system to incorporate local generation, allow two-way power flow, meet projected capacity needs, enhance voltage regulation and system protection requirements, and provide a high level of resiliency and reliability. The Project’s three main objectives are: •Increase capacity on the Electric Grid to allow for the addition of new electrical load from the electrification of heating load, electric vehicles, and battery storage. •Enhance system reliability and resiliency by installing advanced distribution network protection schemes. •Implement distribution system control technologies to allow for high levels of solar penetration, battery storage, distributed energy resources, and electric vehicles. To meet the expected increase in demands, this Project will increase network capacity. Capacity increases will include the following work: •Converting 4kV systems to 12kV. •Installing more distribution transformers with greater capacity. Item No. {{item.number}}. Page 2 of 8 •Rebuilding secondary networks by increasing the conductor size and creating more secondary networks. •Replacing four distribution substation transformers at two substations with larger transformers having greater capacity. BACKGROUND The City established its first Climate Protection Plan in 2007, which is now the Sustainability and Climate Action Plan (S/CAP). This plan has been periodically updated and aligned with current conditions to provide a comprehensive roadmap to reducing greenhouse gas (GHG) emissions. In 2013, Palo Alto became one of the first cities in the nation to source 100% carbon-neutral electricity. In 2020, the City launched an update to reduce GHG emissions 80 percent below 1990 levels, i.e., reduce 624,095 metric tons of greenhouse gases by 2030 (the “80 x 30 goal"). This goal exceeds even the state of California's world-leading reduction goal of 80% by 2050; the California Global Warming Solutions Act of 2006 (AB32) requires the state to reduce its GHG emissions 40% below 1990 levels by 2030 and set an aspirational goal to reduce emissions 80% by 2050. One major initiative in the S/CAP is to promote the transition to all-electric homes and electric vehicles (EVs) to reduce greenhouse gas emissions. A 2021 impact analysis showed to meet the “80 x 30 goal”, the City must electrify all of its roughly 15,000 single-family homes, replacing natural gas equipment with efficient electric alternatives. Also, currently, one in six Palo Altans drive an electric car, and EVs now account for more than 30% of new car sales in Palo Alto - the highest adoption rate in the country. One of three newly registered vehicles in Palo Alto is an EV. This transition, or “electrification,” will require an extensive upgrade to the electric distribution network due to a large increase in electrical energy needed to replace gas heating equipment with electrical equipment and support EVs. As a result, the Grid Mod Project was developed to enhance the distribution system’s grid resiliency and reliability in a manner that will continue to accelerate the City’s clean energy and decarbonization goals. Palo Alto already supplies customers electricity from a 100% carbon neutral portfolio and has been in the forefront of efforts to design programs allowing customers to easily utilize clean energy through EVs and electric appliances. Palo Alto’s grid must be modernized to reach the capacity required to electrify all homes and cars. The modernized system will be designed to fully accommodate energy received from local generation such as rooftop solar and battery storage, an important element in decarbonization goals. There will be an upgrade to the distribution system to incorporate local generation, allow two-way power flow, meet projected capacity needs, enhance voltage regulation and system protection requirements, and provide a high level of resiliency and reliability. ANALYSIS The City conducted an electrification study to evaluate the impacts of projected electrification loads on Palo Alto’s distribution and substation transformers, primary/secondary distribution Item No. {{item.number}}. Page 3 of 8 circuits, and to propose upgrades needed to mitigate overloads. The estimated cost to construct the necessary electric system upgrades for a 100% electrification scenario is between $220 million to $306 million, depending on the approach. Of the nine substations in Palo Alto, the study recommends major design and equipment upgrades at two of the nine substations, and minor to moderate upgrades at four substations to meet projected loads to support 100% electrification. The Grid Mod Project requires bringing online more transformers, replacing deteriorating wires and connectors, upgrading or replacing poles, and providing battery storage and solar system support to the interconnected grid. Specifically, the Project involves replacing the current 1,413 single phase pole top transformers rated less than 50kVA with the same type of transformers rated 50kVA or larger. Additionally, there are currently 261 single-phase pad mount transformers and 231 single-phase underground transformers installed on the distribution system. Based on the projected average peak load of 6kVA per customer, 341 of these transformers (including all 231 underground transformers) will need to be replaced with 75kVA or larger transformers to mitigate overloads. In order to limit the maximum number of customers per transformer to 15 (90kVA), an additional 83 transformers will need to be installed. Furthermore, 296,300 circuit feet of open wire secondary conductors in the distribution system will be replaced with aluminum aerial cable. These design aspects will accommodate 100% residential electrification of end uses in the Palo Alto community, aligning with the City’s primary goal of decarbonization. For future housing development, the City will perform new analysis and make appropriate electric distribution network changes as needed for electrification. Capacity increases on the network are needed to meet the additional load that will be placed on the distribution network. The estimated average diversified electric energy demand for households at the current time is approximately 2-3 kVA per home. When homes are electrified, the diversified electric demand is expected to increase to approximately 6 kVA per home. This increased load will exceed the capacity of the existing distribution network. Most of the impacts of the increased load will be on the distribution transformers and the secondary networks serving homes. In addition, some substation transformers will need to be replaced and upgraded to support the new distribution network. Capacity increases included in this Project are comprised of the following work: •Converting remaining 4kV systems to 12kV. •Installing more distribution transformers with greater capacity. •Rebuilding secondary networks by increasing the conductor size and creating more secondary networks. •Replacing four distribution substation transformers at two substations with larger transformers having greater capacity. Grid resiliency and reliability are key factors in delivering a service to meet customer needs. As electrification loads increase and customers become more dependent upon electricity to meet household and transportation needs, the grid will need to be more reliable and have limited downtime. To help facilitate meeting resiliency and reliability goals, the City’s dark fiber network Item No. {{item.number}}. Page 4 of 8 is currently being expanded to provide services to the community and connectivity to electric distribution switches and protection equipment. To meet the need for greater reliability and resiliency, the Project includes the following: •Additional circuit ties will be installed to improve the ability to pick up load during outages. •Automated restoration schemes that can be used to isolate faults and restore customers will be installed where they are practical to deploy. •Advanced distribution protection schemes will be installed to decrease the size of the outages on the feeders. Due to the high penetration of solar generation, battery storage, and EVs in this community, there will be opportunities to test technologies to control input into the grid, maintain the voltage regulation of the system, and control customer behavior through price signals. Palo Alto is connected to the system operated by the California Independent System Operator (CAISO). Currently the state electricity grid is undergoing a transformation to a grid that relies on renewables. As a result, there are situations where the grid has too much supply, and at other times it is short on supply. Palo Alto will implement technologies that can support the two-way needs of the larger grid. These technologies include solar inverters that regulate power factor and load output, vehicle to grid power supply, and demand management technologies. Palo Alto developed low, mid, and high electric load forecasts through 2045 including the total expected additional data center load, EV load, and building electrification load. In addition to enhancing reliability and resiliency of the electric grid, electrification will benefit the community by saving money, improving qualify of life, and helping the environment. While electrification will typically result in higher electric bills, significant savings can be achieved elsewhere, such as customers’ vehicle fuel and natural gas bills. EV owners can save about $1,000 per year on fuel and thousands of dollars more in maintenance over the life of an EV. As more Low, Mid, and High Load Forecasts through 2045 Item No. {{item.number}}. Page 5 of 8 people switch from fossil fuel to electricity, there will be significant reduction in carbon emissions which helps Palo Alto reach the “80 x 30 goal” to ensure the quality of life for future generations. New electric-powered equipment and appliances are much more energy-efficient than the devices they replace. Heat pump efficiency has risen from 10 SEER (seasonal energy efficiency ratio) to close to 20 SEER — that’s 500% efficient — for cooling, and from 6 HSPF (heating seasonal performance factor) to 10 FSPF — 250% efficient — for heating in a couple of decades. Natural gas furnaces are 92% efficient.1 Customer benefits of grid modernization and electrification include: •Reduced greenhouse gas emissions •Grid-connected or smart appliances •Reduced fire risk and avoid the risks of gas leaks •Increased efficiency and lower energy costs from electric-powered equipment •Reduced power outages •Lower operating and maintenance costs for vehicles, equipment and appliances HIGH-LEVEL ESTIMATED TIMELINE Year 1 – 2024 Task 1.0: Overhead Distribution System Upgrade Pilot Project Subtask 1.1 - Prepare design Subtask 1.2 - Order and delivery of transformers Subtask 1.3 - Material order and delivery Subtask 1.4 - Construction Task 2.0: Design Resource Acquisition Subtask 2.1 - Prepare RFP for Design Services Subtask 2.2 - Evaluate Proposals and Select Consultant Task 3.0: Phase 1 Overhead System Improvements Upgrade 10% of Overhead Distribution System Subtask 3.1 - System Design Subtask 3.2 - Order and delivery of transformers Year 2 – 2025 Task 3.0 (continued): Phase 1 Overhead System Improvements Subtask 3.3 - Material order and delivery Subtask 3.4 - Construction Task 4.0: Phase 2 Overhead System Improvements Upgrade 40% of Overhead Distribution System Subtask 4.1 - System Design Subtask 4.2 - Order and delivery of transformers Subtask 4.3 - Material order and delivery 1 https://www.questline.com/blog/beneficial-electrification-energy-utility-customers/ Item No. {{item.number}}. Page 6 of 8 Subtask 4.4 - Construction Task 5.0: Transformer Upgrades – Colorado Substation Subtask 5.1 - Substation Transformer Expansion Design Subtask 5.2 - Order long-lead time material Year 3 – 2026 Task 6.0: Phase 3 Overhead System Improvements Upgrade 70% of Overhead Distribution System Subtask 6.1 - System Design Subtask 6.2 - Order and delivery of transformers Subtask 6.3 - Material order and delivery Task 7.0: Feeder Ties and Circuit Outlets – Colorado Substation Subtask 7.1 - Design Circuits Subtask 7.2 - Order long-lead time material Task 8.0: Phase 4 Overhead System Improvements Upgrade 100% of Overhead Distribution System Subtask 8.1 - System Design Year 4 – 2027 Task 5.0 (cont.): Transformer Upgrades – Colorado Substation (re-ordered) Subtask 5.3 - Substation Construction Task 6.0 (cont.): Phase 3 Overhead System Improvements Subtask 6.4 - Construction Task 7.0 (cont.): Feeder Ties and Circuit Outlets – Colorado Substation Subtask 7.3 - Construction Task 8.0 (cont.): Phase 4 Overhead System Improvements Subtask 8.2 - Order and delivery of transformers Subtask 8.3 - Material order and delivery Task 9.0: Phase 1 Underground System Improvements Upgrade 33% of Underground Distribution System Subtask 9.1 - System Design Task 10.0: Transformer Upgrades – Hopkins Substation Subtask 10.1 - Substation Transformer Expansion Design Subtask 10.2 - Order long-lead time material Year 5 – 2028 Task 8.0 (cont.): Phase 4 Overhead System Improvements Subtask 8.4 - Construction Task 9.0 (cont.): Phase 1 Underground System Improvements Subtask 9.2 - Order and delivery of transformers Subtask 9.3 - Material order and delivery Subtask 9.4 - Construction Task 11.0: Phase 2 Underground System Improvements Upgrade 66% of Underground Distribution System) Subtask 11.1 - System Design Item No. {{item.number}}. Page 7 of 8 Year 6 – 2029 Task 10.0 (cont.): Transformer Upgrades – Hopkins Substation Subtask 10.3 - Substation Construction Task 11.0 (cont.): Phase 2 Underground System Improvements Subtask 11.2 - Order and delivery of transformers Subtask 11.3 - Material order and delivery Task 12.0: Phase 3 Underground System Improvements Upgrade 100% of Underground Distribution System) Subtask 12.1 - System Design Year 7 – 2030 Task 11.0 (cont.): Phase 2 Underground System Improvements Subtask 11.4 - Construction Task 12.0 (cont.): Phase 3 Underground System Improvements Subtask 12.2 - Order and delivery of transformers Subtask 12.3 - Material order and delivery Subtask 12.4 - Construction FISCAL/RESOURCE IMPACT High level estimated costs including labor and material by activity. The following unit costs are from the 2021 CPUC PG&E Unit Cost Guide, except for pole top transformer and substation transformer/switchgear costs which are provided by Utilities engineering staff. City will continue to pursue grant funding opportunities as they arise. STAKEHOLDER ENGAGEMENT December 7, 2022 – Utilities Advisory Commission Meeting – Electric Distribution Infrastructure Modernization Update https://www.cityofpaloalto.org/files/assets/public/v/2/agendas- minutes-reports/agendas-minutes/utilities-advisory-commission/archived-agenda-and- minutes/agendas-and-minutes-2022/12-07-2022/12-07-2022-agenda-and-packet.pdf Description Qty Unit of Measure Unit Cost Extended Cost 60/12 kV s ubstation trans former and switchgear 2 Unit 25,000,000$ 50,000,000$ 115/60 kV s ubstation transformer and high s ide breaker 2 Unit 20,000,000$ 40,000,000$ Single phas e pole top trans former including pole make ready/replacement 1,400 Unit 20,000$ 28,000,000$ Single phas e pad mount trans former including s ubstructure 424 Unit 40,000$ 16,960,000$ Underground 12 kV circuit tie including cable, trench and s ubstructures 30,900 Foot 800$ 24,720,000$ Overhead 12 kV circuit tie/reconductor 11,000 Foot 220$ 2,420,000$ Overhead s econdary reconductor with AWAC 296,300 Foot 165$ 48,889,500$ 4 kV to 12 kV convers ion including trans formers 381 Unit 23,200$ 8,839,200$ Total Estimate 219,828,700$ Item No. {{item.number}}. Page 8 of 8 June 7, 2023 – Utilities Advisory Commission Meeting – Electric Distribution Infrastructure Modernization Update https://cityofpaloalto.primegov.com/meeting/attachment/1764.pdf?name=Electrification%20 Modernrization%20Plan%206-7-2023 November 30, 2023 - Sustainability and Climate Action Plan Ad Hoc Committee Meeting – S/CAP Progress and 100% Renewable Energy https://www.cityofpaloalto.org/files/assets/public/v/1/sustainability/presentations/2023.11.30 -scap-ad-hoc-committee-meeting.pdf ENVIRONMENTAL REVIEW This informational report is not a project under CEQA. The overhead distribution system upgrade pilot project currently in progress is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines 15301 (repair, maintenance, of existing facilities) and 15302 (replacement or reconstruction of existing facilities). ATTACHMENTS Attachment A: Presentation AUTHOR/TITLE: Dean Batchelor, Director of Utilities Staff: Dave Yuan, Utilities Strategic Business Manager Discussion of Electric Grid Modernization Plan February 7, 2024 www.cityofpaloalto.org 2 Presentation Outline §Distribution System Topology §Residential Customer Connections – Past & Future §Major Projects -Upgrading Distribution System Hardware (Phase 1) -Complete 4 kV to 12 kV upgrade (2 substation) -Integrating new utility technologies -Integrating with new customer technologies -Fiber to the premise §Timeline and Resources 3 CPAU Topology Generation Transmission - owned by PG&E -3 Transmission Lines, 115 kV rated Receiving Substations - 8 distribution substation -1 transmission substation - 60 kV sub transmission network Distribution System Network - 12.47 kV primary circuit -4.16 kV primary circuit -Transformers (TX) range: 5 kVA – 2.5 MVA CPAU Customers -120/240 V for residential -120/208/480V for commercial 4 Existing Customer Connections §3 KVA Expected peak load demand from residential customer §For new, relocated, or upgraded 200 A electrical services §Customer invoiced for standard fee §For new, relocated, or upgraded >200 A electrical services §Customer invoiced advance engineering fee §Customer invoiced for additional expenses determined by estimators §Customer is responsible for any substructure work, secondary cabling, and electric meter panel §CPAU responsible for infrastructure upgrades & labor of connecting electrical services 5 Updated Customer Connections - Future §6 kVA expected peak load demand from residential customer – up from 3 kVA estimated allocation from the past §Customers will still receive standard invoice for 200 A service §In Development: standard connection fee for 400 A service 6 CPAU Strategic Projects Grid Modernization for Electrification •Upgrade current infrastructure (TXs, cable sizes, etc.) •Integrating new technology (i.e., AMI, fault indicators, remote switching, fuse savers) •Customer technologies (solar PV, ESS, EV, V2X, HPWHs) Fiber to the Premise (FTTP) •CPA new internet service provider •Goal: to upgrade and expand the existing fiber backbone and FTTP for all homes and businesses •To build new fiber connections to support CPA Internet services to all Palo Alto homes 7 Upgrading Existing Distribution System Elements §Overall System Upgrade o Upgrade 4 kV lines installed in 1967 to 12 kV lines o Upgrade 4 of 30 substation transformers o Upgrade 1741 of 3000 distribution system transformers o Upgrade 56 miles of secondary and 17 miles of primary distribution lines §Phase 1 o Complete system upgrades and improvements affecting 6,784 customers Grid Modernization Phase 1 Pilot Area Customers: 1,224 Total Poles: 409 Phase 1 Customers: 6,784 Total Poles: 1,650 Overhead Secondary System Design Upgrade to 50 kVA TX Up to 8 customers per 50 kVA transformer 4/0 AL cable to replace majority of existing open wire or rack secondary conductors Fiber to the house addition 9 Service drop to be replaced with 1/0 AL triplex Overhead Electrification Scope of Work •Approximately 1400 single phase pole top TXs will need to be replaced with a 50 kVA or larger TX •A total of 296,300 circuit feet (56 miles) of open wire and rack secondary conductors will need to be replaced with aerial cable (1/0 AL Or 4/0 AL) for the entire City 10 Underground Secondary System Design Must be 75 kVA TX 350 AL sec. cable to replace any smaller cable Up to 12 customers per transformer Up to 12 customers per transformer 350 AL sec. cable to replace any smaller cable Remove all URD TXs Replace with 75 kVA TX Pad Mount Transformer System URD Transformer System 11 Underground Electrification Scope of Work •Of the 261 single phase padmount TX in CPA, 110 TX will need to be replaced with a 75kVA or larger TX •An additional 52 TXs will need to be installed •All 231 single phase URD TX in CPA will need to be replaced with a 75KVA or larger TX •An additional 31 TXs will need to be installed 12 13 Grid Modernization impact on CPAU Infrastructure Supply/Resources Transmission Substations -replace 4 of 30 substations TX with larger capacity Distribution System Network - Replaced secondary cable -4.16 kV circuit to be replaced with 12.47 kV -upgrade and add TX -replace service laterals -remove URD TX CPAU Customers -New service fees -Integrate AMI and other customer technology 14 §Consultants §ENTRUST §Magellen §Soudi Inc §Contractors §MP Next Level §VIP Powerline Corp §Davey Tree §Funding §Est. Budget of $220- $306M §Bond Issuance / Debt Financing §CIP Funding Resource Necessities 15 Fall 2024 Proposed Timeline Pilot Area Complete Summer 2025 Phase 1 Complete Winter 2030 All Phases Complete 16 THANK YOU! Dean Batchelor, Director of Utilities Dean.batchelor@CityofPaloAlto.org