Passed in the 2019 legislative session, SB 358 set the goal for providers of electric service to use a net-zero carbon emissions resource portfolio to meet their customers’ electricity needs by 2050. Requiring greenhouse gas (GHG) reduction plans and prioritizing decarbonization in utility integrated resource plans (IRPs) would further progress toward this goal.
Nevada requires electric utilities to file an IRP with the Nevada Public Utilities Commission (PUCN) on or before June 1 every three years. The IRP must set forth a three-year action plan to meet demand for electric service in an efficient, reliable, and sustainable manner over a 20-year planning period. Among other requirements, the PUCN must give preference to the measures and sources of supply that provide the greatest economic and environmental benefits to the state.
An electric utility’s resource plan must include several different components, including a forecast of future load, a demand-side plan, a supply-side plan, a financial plan, an energy supply plan, and an action plan for next steps in the utility’s resource procurement or demand-side resources.
Nevada’s regulations already require environmental issues be addressed in a supply-side plan. Every option for supply must include an examination of the environmental impacts, taking into account the best available technologies and the environmental benefit of renewable resources. Options for lower carbon intensity must be assessed, and the plan must include at least one alternative plan of low carbon intensity (referred to as the low-carbon case). The alternative low-carbon plan must account for the generation or acquisition of an amount of renewable energy greater than required by the RPS, changes to the utility’s existing fleet of resources for the generation of power, and the application of technology that would significantly reduce emissions of carbon. Also, the environmental costs to Nevada associated with operating and maintaining a supply plan must be quantified for air emissions, water and land use, and the social cost of carbon.
Currently, natural gas-fired generating units can be used as placeholders in the IRP in the electric utility’s supply-side plan. These are only used to permit analysis of different supply-side options and maintain consistency between placeholders over multiple IRP cases so that assumptions about the future do not influence the selection of resources in a supply-side plan. To be clear, the utility is not seeking PUCN authority to construct the natural gas-fired generating units that serve as placeholders. Using natural gas-fired generating unit placeholders allows the production cost modeling software to complete its algorithm over the requisite 20-year analysis period.
However, eliminating the ability to use natural gas as placeholders and requiring the electric utility to use placeholders that more closely model Nevada’s GHG emissions-reduction goals in its IRP would provide valuable information regarding grid reliability in order to effectively map a path toward net-zero emissions without compromising power delivery.
Eliminating natural gas-fired generating unit placeholders would be consistent with the PUCN’s recent findings in NV Energy’s most recent triennial IRP: