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PNM’s draft 2017 IRP available for public input

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Public input and comments on the draft 2017 Integrated Resource Plan (IRP) of PNM Resources’ (NYSE:PNM) New Mexico utility, Public Service Co. of New Mexico (PNM), are being considered as part of the ongoing IRP process, which culminates in a final report to be filed with the New Mexico Public Regulation Commission by July 3, PNM Resources said on April 21.

Every three years, PNM is required to produce and file an IRP with the commission, the company said, noting that PNM evaluates numerous existing and anticipated options for energy resources over the next 20 years to determine the most cost-effective mix of resources that will support reliability and environmental responsibility.

The company noted that highlights of the draft 2017 IRP include that:

  • PNM would retire the San Juan Generating Station (SJGS) Units 1 and 4 by the end of 2022, after the existing coal supply agreement expires (Units 2 and 3 will be retired at the end of 2017)
  • PNM would exit its 13% participation in the Four Corners power plant when the existing coal supply agreement expires in 2031
  • Replacement power would include renewables, natural gas, and potentially energy storage
  • PNM would retain its capacity in the Palo Verde nuclear generating station that is currently being leased

The company said that in accordance with the SJGS settlement agreement previously approved by the commission, the IRP considers two primary scenarios – one with the retirement of the SJGS at the end of 2022, and one with the continued operation of the SJGS after 2022.

On transmission, the draft IRP noted that there are two key transmission paths in New Mexico – Path 47 and Path 48 – that are defined in the planning and operation of the transmission system. Path 48 describes transmission lines in the northern part of the state, while Path 47 describes transmission in the southern part of the state.

PNM’s capacity in those two transmission paths is fully committed, and transferring existing firm resources, as well as any new resources that require transmission along those paths, will need to include a transmission system expansion, the draft IRP added.

Siting, permitting, cost, and construction timelines for new transmission line projects will continue to be a challenge, the draft IRP said. The use of load-side generation will continue to play a role in supporting the system and alleviating transmission constraints barring any future barriers to that type of operating practice, according to the draft IRP.

Discussing the eastern New Mexico transmission system, for instance, the draft IRP noted that several wind energy centers have been developed in that area.

Three additional New Mexico wind farm projects have entered into power purchase agreements with customers in California and have acquired, or are in the process of acquiring, transmission service from PNM. Pattern Energy Group Inc., the draft IRP added, has developed the Broadview wind farm – 297 MW – that interconnects to PNM’s Blackwater station near the Texas border, and plans to develop a second wind farm called Grady – 200 MW – that will interconnect to the transmission line that is interconnected to PNM’s Blackwater station. The draft IRP also noted that Avangrid is developing the El Cabo wind farm – 298 MW – that will interconnect to PNM’s EIP line near Clines Corners in June.

The addition of those wind farms, along with the existing wind farms, will result in 1,000 MW of requested transmission service on the EIP line, and as a result, PNM will install a Static VAR Compensator (SVC) to the EIP line, scheduled to be in service in March 2018, to accommodate those projects’ transmission service needs, the draft IRP said.

The EIP, or Eastern Interconnect Project, is PNM’s 216-mile, 345-kV transmission line from the BA 345-kV switching station – north of Albuquerque – to PNM’s Blackwater 345-kV station – in the Clovis-Portales area of eastern New Mexico.

Projects that are under construction and intended to provide additional transmission capability or voltage support to increase or maximize use of existing transmission facilities, include the:

  • New Clines Corner switching station in association with the interconnection of the El Cabo wind farm to the EIP line; the expected in-service date is in April
  • New Richmond switching station in Albuquerque that allows for the reconfiguration of the existing 115-kV lines to mitigate 115-kV overloads; the expected in-service date is in May
  • Guadalupe SVC that provides voltage support, enabling the full use of the B-A to Blackwater transmission line for point to point transmission service; the expected in-service date is March 2018
  • New Cabezon switching station in Sandoval County in association with the interconnection of the Tri-State new 345/115-kV Torreon substation to the Cabezon station on PNM’s San Juan-to-Rio Puerco 345-kV transmission line; the expected in-service date is April 2018

Discussing merchant transmission in New Mexico, the draft IRP noted that PNM executed a Standard Transmission Construction and Interconnection Agreement in July 2012, which incorporates the requirements for interconnection of the Tres Amigas 345-kV line (Western Interconnect) to PNM’s Blackwater station.

That interconnection was completed in January to inject power from the Broadview windfarm, the draft IRP said, adding that the El Cabo 345-kV transmission line interconnection is being developed by Avangrid for its El Cabo wind farm that will interconnect to PNM’s EIP line near Clines Corners as part of a large generation interconnection agreement.

PNM is in the process of completing the technical studies for the Mora 115-kV line, Western Spirit 345-kV line and Verde 345-kV line transmission interconnection projects.

The Mora line is proposed by Lucky Corridor LLC and will interconnect with the 115-kV systems of PNM and Tri-State Generation and Transmission Cooperative in northern New Mexico, the draft IRP added, noting that the project would serve to connect about 160 MW of renewable resources in northeastern New Mexico.

Clean Line Energy Partners is pursuing the development of the approximately 140-mile Western Spirit line that could deliver up to 1,000 MW of renewable energy resources from east central New Mexico to PNM’s Rio Puerco switching station, the draft IRP said.

Hunt Power is proposing the Verde line, which connects the Ojo 345-kV switching station to the Norton 345-kV switching station through an approximately 30-mile, 345-kV line, the draft IRP said, noting that the project would increase the ability to import power into northern New Mexico from the Four Corners area by completing a third full 345-kV path into the Albuquerque metropolitan area.

Regarding potential new transmission projects, the draft IRP noted that PNM considered an 80-MW new generation resource to be developed in southern New Mexico. Associated with that potential resource is the need for additional third-party firm point-to-point transmission service from Tucson Electric Power (TEP) to be able to transmit the power to PNM’s central and northern load centers.

The draft IRP added that based on TEP’s current FERC-accepted transmission tariff rates, the expected transmission cost for an 80-MW plant is about $2.6m per year. Additionally, the expected interconnection costs for the 80-MW plant connecting to the 345-kV transmission system in southern New Mexico is $12m, assuming a new three breaker 345-kV station connected to a PNM transmission line, according to the draft IRP.

Among other things, the draft IRP discussed potential new electric market interactions, noting that PNM plans to contract with a consulting firm to perform a study to evaluate the costs and benefits of the company participating in the California ISO energy imbalance market, which was launched in November 2014.

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