Offshore Wind Integration Studies at PJM September 13

2010 RTEP - Conceptual Offshore Wind Study • • • Reliability + Market Efficiency Entirely Offshore Wind Injected at 4 locations – Hudson, Larrabee, Indian River, Fentress • 4 Scenarios – No wind – 10 GW, 20 GW, 30 GW • Conclusion – Market efficiency simulated almost no wind curtailment at 10 GW peneteration. – Moderate curtailment at 20 GW penetration – Major curtailment at 30 GW penetration www. pjm. com 2 PJM© 2012

2011 RTEP RPS Scenario Studies • Satisfy RPS needs with PJM resources • Multiple sourcing scenarios for ~ 40 GW total of wind – 20 GW offshore – 4 GW offshore • Study identified congestion at the injection points that would require significant transmission investment. 3 PJM© 2012

2012 RTEP • Building off the work done in the 2011 RTEP • Evaluating three sourcing scenarios to meet PJM RPS requirements in 2027 – 36 GW wind and 3. 6 GW solar – Scenario 1 – source all RPS from within PJM with 7 GW offshore wind and 29 GW from land-based wind – Scenario 2 – source all RPS from land-based resources – Scenario 3 – wind sourced 60% internal to PJM and 40% from MISO / SPP 5 PJM© 2012

2012 RTEP – Preliminary Analysis • Purpose – Initial modeling and analyses focused on validating the ability of the production cost simulation tools to model a system similar to the AWC project including offshore wind resources interconnected via HVDC. – Leveraged modeling and analysis done as part of the 2011 RTEP 6 PJM© 2012

Input Assumptions • Preliminary set of PROMOD runs using last year’s base case: • • Study year 2016 PJM Deactivations not modeled 2011 RTEP power flow case (no MAPP, PATH) Gas forecast: Henry Hub ~7 $/MMBtu • HVDC Terminals & Wind Injection Points: • • Hudson 1 (PSEG) Cardiff (Atlantic Electric) Indian River (DP&L) Navy (Dominion) • Offshore wind profile parameters (NREL data) : • CF 47% • Annual Total Energy ~16, 401 GWh for 4000 MW nameplate • HVDC lines modeled with no losses, no operating restrictions. 7 PJM© 2012

AWC Scenarios Overview AWC Wind Install Cap (MW) Idx Scenario Description AWC 00 Topology Comments HVDC Offshore Radial Lines Base Scenario No HVDC Offshore, No radial lines No Wind No No Base Scenario AWC 01 Base Scenario with HVDC Offshore No Wind Yes No Shows the impact of HVDC lines even without wind injections. AWC 02 Hudson 4000 MW Scenario with HVDC Offshore 4000 MW Wind @ Hudson Yes No 4000 MW wind installed at Hudson AWC 03 Cardiff 4000 MW Scenario with HVDC Offshore 4000 MW Wind @ Cardiff Yes No 4000 MW wind installed at Cardiff AWC 04 4 x 1000 MW Scenario with HVDC Offshore 4 x 1000 MW Wind Yes No 1000 MW wind each at Hudson, Cardiff, Indian River, and Navy AWC 05 Hudson 4000 MW Scenario radial line into Hudson 4000 MW Wind @ Hudson No Yes Same as Scenario AWC 02, no HVDC lines AWC 06 Cardiff 4000 MW Scenario radial line into Cardiff 4000 MW Wind @ Cardiff No Yes Same as Scenario AWC 03, no HVDC lines AWC 07 4 x 1000 MW Scenario radial lines 4 x 1000 MW Wind No Yes Same as Scenario AWC 04, no HVDC lines Hudson Cardiff Ind. Riv Navy 4, 000 1, 000 1, 000 1. The Market Efficiency scenarios for this study were derived from last year's interregional base case. 8 PJM© 2012

Offshore Flows – HVDC Tie Flows 9 PJM© 2012

Onshore Flows (Net Flow from HVDC terminals) • • • Results shows that the flows going onshore, out from the HVDC terminals, are indifferent to the wind injection point - PROMOD yields the optimal onshore injection pattern no matter of the particular position of the wind farm on the HVDC. Indian River appears to be the preferred injection point - may be a factor of the number of flow gates (or lack thereof) modeled for Delmarva peninsula. There is no wind curtailment, the wind profile is used at full capacity. Flows from Navy HVDC terminal always heavy into the HVDC line, going north. The total net flows toward shore, in the base case, is not zero, due to a small amount of bus load at the injection points. 10 PJM© 2012

LMP Impacts The charts show the incremental LMP impact (On-Peak and Off-Peak) of adding

LMP Impacts – Radial Injection vs. HVDC 12 PJM© 2012

LMP Impacts – Radial Injection vs. HVDC 13 PJM© 2012

Next Steps • Update modeling consistent with 2012 RTEP Assumptions § § § Footprint includes PJM, MISO 2017 updated power flow topology Updated Gas forecast: Henry Hub ~4. 9 $/MMBtu PJM Announced Deactivations Installed Renewable Resources consistent with the RPS requirements of PJM states. • Consider the states request requirements: § 7000 MW Offshore Wind § AWC HVDC System modeled as controllable system to optimize the wind injection. § Study year 2023 § Customized outputs reports by state: production cost savings; avoided congestion savings; pollution reduction benefits, etc. 14 PJM© 2012

2012 RTEP – 7 GW Radial Injection www. pjm. com 15 PJM© 2012

2012 RTEP – 7 GW Offshore with HVDC Interconnection www. pjm. com 16 PJM©

Offshore Wind Joint Study – NCTPC • PJM is also engaged in a joint study with the North Carolina Transmission Planning Collaborative. • Evaluating three scenarios – 1000 MW injection at Landstowne, Morehead City and Southport – 2000 MW injection at Landstowne and 1500 MW injection at Morehead City and Southport – 4500 MW injection at Landstowne and a 3500 MW injection at Morehead City and a 2000 MW injection at Southport • Reliability analysis of the three scenarios is in-progress www. pjm. com 17 PJM© 2012