NV Energy proposes gas peakers with a capacity of 400 MW, over 1 GW each of solar energy, storage in IRP 2024

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Brief description of the dive:

• On May 31, NV Energy filed a 2024 integrated resource plan with the Nevada Public Utilities Commission, proposing more than 1,000 MW of solar and more than 1,000 MW of batteries under three renewable energy purchase agreements and storage, construction of a 400 MW activated peak production capacity at a cost of $573 million and associated higher costs Greenlink transmission projects.

• The Nevada utility expects “significant load increases in the state through 2034.” as a result of growing population, electrification and data center development in its service area, NV Energy told regulators.

• The IRP is “encouraging” for a demand-side approach and system planning, but “disappointing” with resource procurement, said Brian Turner, director of policy at Advanced Energy United. The solar and storage resources are “substantial,” he said, but “we have good reason to believe they could do a much better job of securing bids.”

Diving Insights:

Demand projections have increased significantly since NV Energy filed its 2021 IRP as the company also works to achieve a 50% renewable energy portfolio standard by 2030, the utility says in its planning documents.

“This is our path forward and these are our priority projects to meet the current and long-term needs of our current and future customers,” NV Energy President and CEO Doug Cannon said in a statement Thursday announcing the IRP. “The required resources represent a balanced portfolio that will reduce NV Energy’s reliance on expensive and unreliable market resources.”

Last month, the utility said it planned to join an expanded day-ahead market being developed by a California-based independent system operator. He will probably apply to join the PUC in the fall.

NV Energy’s list of proposed projects includes:

• About 400 MW of peak gas generating capacity at the North Valmy Generating Station, which is expected to come online in summer 2028 and which the utility says will “be able to use hydrogen in the future”;

• PPA for the Dry Lake East solar and storage facility, expected to come online in 2026, with 200 MW of solar and 200 MW of 4-hour storage, located northeast of Las Vegas in Clark County;

• PPA for Boulder Solar III, expected to come online in June 2027, including 128 MW of solar capacity and a 128 MW 4-hour battery in Boulder City;

• The PPA for Libra Solar, which is expected to be operational by the end of 2027 and will include 700 MW of solar capacity and a 700 MW 4-hour battery, will be located approximately 30 km south of the Fort Churchill substation in Yerington.

• Continued approval of NV Energy’s Greenlink transmission project, a 525 kV transmission network in Nevada that the utility says will improve grid reliability and access to renewable energy.

The story continues

Greenlink project costs rose to $4.2 billion from about $2.5 billion, the company said, citing supply chain constraints, labor rates and inflation. “The only practical alternative to building Greenlink is to build additional generation closer to the loading centers… similar reliability cannot be achieved at lower cost without Greenlink,” the utility said in its application.

The Libra solar and storage project is valued at more than $2.3 billion, developer Arevia Power said on Thursday.

According to IRP, the Libra PPA is for a 25-year fixed-rate power price of $34.97/MWh and a 20-year battery contract term with a fixed rate of $13,350/MW-month. In years 21-25 the PPA battery will not be charged.

“Integrating a large-scale battery storage system into the solar energy project ensures that we will be able to effectively meet our energy needs while significantly reducing our carbon footprint,” Cannon said.

As AEU’s Turner stated, NV Energy’s IRP has improved somewhat over previous iterations. The company has moved to an integrated network planning perspective, “whereby distributed resources are better integrated with load and delivery needs.” They also developed an approach to distributed resources that emphasizes the network value generated by those resources, rather than focusing solely on local demand reductions, he said.

However, Turner also said that NV Energy’s approach to project development lags behind best practices developed in states such as Colorado, where the utility’s IRP is used to determine resource demand, which is then met through all-source procurement.

“NV Energy sporadically puts out requests for proposals, receives those offers, privately negotiates with the projects it likes best, and we, the interested parties and especially the development community, have no visibility into how that process works,” Turner said.

“I think they could have done better and differently in proposing these gas resources if they had a more robust renewable energy procurement program,” he said.

Turner said the PUC will likely spend about six months reviewing the IRP before issuing a decision. “We will have testimony, cross-examination and a hearing, and then the committee will make a decision,” he said. “We will argue about details, such as how they could do more, cheaper, better and with more distributed resources.”