City Council
Item #8: Silicon Valley
Power Quarterly Update
RTC 23-1159
October 10, 2023
Agenda
• Background and Load Growth
– Actions Taken to Date
– Load Growth Drivers
– Load Growth and Reliability Projects
• Current Status of Major Projects
• Current Load Plan and Additional Power Requests
• Development Projects and Power Constraints
• Residential and Commercial Rates (question per last quarterly report)
• Staff determined there was a growth
need in late 2019 as part of an SVP
Strategic Planning Session
• Prioritized Growth Plan as an SVP
Strategic Priority
– Also prioritized proactive maintenance
• Needs for both SVP Local System and
Transmission System
• Peak limit approximately 750 MW
– At the time planning for a 1000+ MW
system
• Some delays due to Covid-19
Background
Load Growth Drivers
Data Centers and Commercial & Residential Development Drive Load Growth • Tasman East Specific Plan, Patrick Henry Drive Specific Plan, Related Santa Clara • City Council Approved Substation Agreements (2019 to 2023) – Parker Substation Expansion – completed
– Oaks Junction – completed
– San Tomas Junction – final design, award t-line, data center under construction – Esperanca Substation – design phase
– Stender Way Junction – final design, data center under construction – Laurelwood Substation - design phase, data center w/ 12kV service – Freedom Circle Junction – construction, award t-line, data center w/ 12kV service – Memorex Junction – award t-line, data center under construction phase • Upcoming Substation Agreements
– Juliette Substation Expansion
– Martin Ave Junction
– Freedom Circle Junction (Phase 2 of 2) need HVDC line before 2028 – Democracy Substation (56 MW) firm capacity (N-1, one transformer)
• Load Growth is Happening – New Peak of 694 MW on September 6th, 2022 (system capacity 750MW per CAISO Transmission Planning Process 23/24 system model)
• Even with unusually cool summer, loads have continued to grow • Two Multi-Phased Activities
– SVP local projects and CAISO Transmission Projects
• SVP Local Projects – Finished construction of South Loop Project, Approved Growth Plan, Approved New Load Development Fees, Approved Master Consultant Contracts, Approved Program Management Contract, Approved Kifer Battery Storage Project, Homestead Substation • Work is Underway
Load Growth and Reliability Projects
• October 13, 2020 - Master Service Agreements with several engineering consultant firms – updated on May 3, 2022, October 4, 2022, and July 18, 2023 • April 6, 2021 - Staff provided a comprehensive review to the City Council of upcoming load growth and capital projects as part of the SVP Quarterly Report. • September 28, 2021 - Council accepted Silicon Valley Power (SVP) Three-Year System Growth Plan Strategy
• April 5, 2022 - Updated Connection and Load Development Fee. The fees were updated for FY 2023/24 on April 18, 2023.
• November 15, 2022 - Council accepted SVP’s System Expansion Plan for the California Independent Operator’s (CAISO) Transmission Planning Process (TPP) • On May 9, 2023 - Council adopted a Resolution regarding the City’s intent to issue tax - exempt electric system bonds and updated on 7/13/2021
Highlights of Council Actions
7 CAPITAL PROJECT 2023 2024 2025 2026 2027 2028 2029 Electric Utility Capital Projects
SYSTEM EXPANSION
DATA CENTER &
LARGE DEVELOPMENTS
RELIABILITY
CAISO HVDC Transmission
Northern Receiving Station (NRS)
Kifer Receiving Station (KRS)
Scott Receiving Station
NRS/KRS 115kV Transmission
60kV Transmission Projects
Freedom Circle Substation
San Tomas Substation
Memorex Substation
Stender Way Substation
Bowers Avenue Substation
Laurelwood Substation
Esperanca Substation
Martin Avenue Substation
Juliette Substation Expansion
Democracy Substation
Kifer 50MW Battery Storage
Homestead Substation
CAPITAL PROJECT DRIVER
SVP Receiving Station Upgrades
• Northern Receiving Station (NRS):
• Relocation of two existing PG&E 115 kV overhead connections and CAISO meters, additional transformers, upgrade of existing main/transfer bus configurations, circuit breakers, disconnect switches and system protection improvements.
• 30% design is underway
• Recommendation to purchase Large Transformers October 2023 • Scott and Kifer Receiving Stations (SRS & KRS):
• Replaces end of life infrastructure and increases capacity • Full Rebuild - New 60kV/115kV Switchgear, control rooms, transformers, circuit breakers, disconnecting earthing switches, cable sealing, relocation of 60kV and 115kV transmission lines associated with each substation.
• Value engineering underway
• Recommendation to purchase Large Transformers October 2023 KIFER
RECEIVING
STATION
(KRS)
SCOTT
RECEIVING
STATION
(SRS)
NORTHERN
RECEIVING
STATION
(NRS)
115kV Transmission Line
Northern to Kifer Receiving Station
• Project Scope: Construct a new 115kV transmission
line between Northern Receiving Station and Kifer
Receiving Station. The line will be designed to the
higher 230 kV standards and energized at 115 kV.
• Route Analysis Report has been prepared
• Verification of route feasibility will be performed by potholing for buried utilities prior to a final route
recommendation.
• Upcoming Council Discussion
CAISO 2021/22 Transmission Planning Process Process
Approved Transmission
6/01/20 Started work on updated load 1,142 MW’s
11/3/30 Started discussion with CEC
12/17/20 Started meeting with PG&E regarding additional projects 1/25/21 CEC adopts new SVP load forecast
3/11/21 SVP comments on draft Study Plan
3/24/21 SVP presents to CAISO board
3/31/21 Final Study Plan Posted
8/3/21 CAISO posts preliminary reliability study results 9/15/21 PG&E posts mitigation plans
9/27/21 Stakeholder meeting for comments on mitigation plans 1/31/22 Draft Transmission Plan posted
3/23/22 CAISO Board of Governors Approved Transmission Plan 4/1/22 Project Procurement Phase Starts
3/7/23 CAISO selected LS Power Grid High Voltage Direct Current Line from Newark 230kV to SVP’s Northern
Receiving Station
CAISO Transmission Line from
PG&E Newark Station to SVP
Northern Receiving Station
• LS Power Project scope:
• Two High Voltage Direct Current (HVDC)
Terminals,
• ±320 kV HVDC underground and overhead
transmission line between the terminals
(preliminary preferred route is ~8 miles)
• 230 kV interconnection at each station
• Target in-service date by mid 2028
• Monthly Project Coordination Meetings
• Future Interconnection Agreement between
LS Power and SVP for Council Action.
Additional Load Growth
• We have 13 large projects entitled or under
construction – that gets us to approximately
1,200 MW
• Can’t currently serve all large Data Centers who
would like to be in Santa Clara
– 7 additional projects have completed System
Impact Studies (242 MW)
– 5 additional projects are interested in
completing System Impact Studies (162
MW)
– 3 additional projects have inquired and are
yet to be studied
• How much growth is feasible?????
Additional Power
Technology MW Projected
Online Date
Contract Status
Wind 50 2025 Executed**
Wind 300 2026 Executed**
Solar / BESS 600 / 350 Existing Preliminary Investigation Solar 50 2026 Preliminary Investigation
Solar / BESS 100 / 100 2026 Preliminary Investigation
Solar 100 2026 Preliminary Investigation
Solar 100 2027 Preliminary Investigation
Solar 137 2029 In Negotiation
• The market prices for
Renewable Projects are
increasing due to
construction delays
• Two projects under
contract are requesting
price renegotiation
• Supply Chain, Inflation,
Interconnection, Permitting
Delays, and Cost of
Capital are driving up
project costs nearly 50%
Funding and Rates
• Combination of Rates and Load
Development Fee
• Load Development fee was increased up to
160%
• $550 Million Retail Sales Revenues
– Residential $33 million
• Sales expected to double in the next 10 years
• Like most other utilities higher rate
increases will be needed over the next few
years
Rates and Customer Base
• Reasons for rate increases are affecting all utilities – Transmission Access Charges
– Power and Natural Gas commodities are higher
– Power Purchase Agreements
– Natural Gas Commodity
– Higher costs of Materials and Equipment and longer procurement – Recovery from Historic Natural Gas prices last year
• Positives of having a large customer base
– Major capital costs are spread through all customers (example - residential customers are only responsible for 2% of the cost to rebuild SRS and KRS) – Allowed us to construct DVR and Gianera which provide a net positive in power prices – Has allowed us to have large ownership of major NCPA projects such as the Geothermal Energy and Lodi Energy Center which helps stabilize rates – Allowed us to “go after” large PPA’s which results in better prices • Consider rate increase December 5, 2023
• Next 6 months highlights
– High Voltage Transformer Bid Award (Tonight)
– Bond Financing of 4 CIP Transmission Projects ~ Mid 2024 – Multiple System Expansion Contract Awards
– Completion of solicitations and master agreements for critical services supporting existing infrastructure (powerplants, substations, transmission and distribution).
– Integrated Resources Plan (IRP)
– Launch of commercial customer solar rebate
– Many additional items…….
Upcoming Items
City Council
Item #7: Silicon Power
Quarterly Update
RTC 23-1159
October 10, 2023