CMPAS has organized and led several Power Supply Planning Coalitions with other municipals who may have a similar need for a study that evaluates possible resource alternatives. The coalition process creates a mutually beneficial win-win solution for all participants on a cost-sharing and cost-saving basis as they each receive an individualized, rigorous and comprehensive analyses of alternatives.
To begin, the professional staff at CMPAS collects information and performs an initial analysis before making a formal request for proposal (RFP) solicitation on behalf of the coalition. As the process evolves, CMPAS continues to conduct the majority of the labor and saves on costs by limiting the need for outside consultants. Each coalition participant also benefits from the increased resource need created by a larger group that produces more bids, more alternatives, and more competitive pricing than they could obtain alone.
On an individual basis, the team at CMPAS can also provide non-member, independent utilities a customized power supply/resource planning study for a fee.
PURPOSE OF POWER SUPPLY PLANNING
Resource planning involves quantitative analysis to identify the optimum mix of base load, intermediate, and peaking resources. An optimum portfolio minimizes total cost by determining the mix of generation resources that minimizes the sum of both the expected fixed costs (i.e., debt service) and the expected variable costs (i.e., fuel cost).
For example, base load resources like coal require a high, upfront fixed cost investment but deliver low annual operating costs. Peaking resources require a much lower upfront fixed cost investment but deliver significantly higher and more volatile operating costs. By appropriately mixing and sizing generation resource types with differing fixed and variable cost characteristics, portfolio costs can be minimized.
Planning provides the necessary critical information for making well informed decisions and includes comprehensive, comparative analysis of all the alternatives. Municipals can use this information to determine the size, type and timing of building or procuring resources. They can also use it to explore direct ownership or power purchase agreement options; determine whether to retrofit, retire, or replace existing generation resources; or make decisions about power purchases from the variable spot or fixed price bilateral markets.
Typical power supply planning activities usually include:
- Econometric weather normalized long range forecasting
- Long-range gas and market price forecasts by independent consultants
- Economic dispatch analysis/production cost optimization
- Financial analysis
- Sensitivity Analysis
- Transmission tariff analysis
- RFP preparation and evaluation
- Financial Analysis
- Ten-year forecasts of a municipal’s expected wholesale costs projections