JKM Draft 08/ 1 7/2014

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### List of technical questions **from Nevada for EPA:**  **1. Assumptions re goal calculation**  **and potential compliance scenarios :** 
a. Some states have said that 2012 was an anomalous year because natural gas prices were so low. Has EPA considered averaging emissions from a longer range to use as the basis for its goal computation? b. The national average of 70% NGCC capacity is unrealistic for many states. In Nevada, we face a unique situation wher e electricity consumption continues throughout the night and NGCC plants are used as peakers, not baseload capacity. Currently evaluating whether 50% is realistic. Did EPA do any such analysis, or just look at national average?
c. Building block 3 (RE) is calculated based on 2012 electricity demand but does not account for load growth. If load were to grow, we would basically need to add more renewables than natural gas in order to reach/maintain the goal (because the goal of 647 is significantly less than the new source performance standard for new or modified NGCC plants). Has EPA considered adding load growth to its equation, and if so, what growth percentage does it believe is reasonable? d. Building block 3 (RE) is calculated based on an average of Sta te RPS standards, for those that have them. Yet Nevada’s RPS is inconsistent with EPA’s treatment of renewables as described in the TSD . For example, Nevada’s RPS allows small hydro
power (<30 MW) , some energy recovery from waste heat generation (<15 MW) and banking of renewable generation in excess of the standard. Would NV be allowed to include any of these aspects in its Plan? Is waste heat recovery an RE measure or an EE measure? (NV Energy has a plant (Goodsprings) that recovers waste heat from natu ral gas compressors that is then used to drive an electrical generator; credits apply to Nevada’s RPS compliance.)
e. EPA has mentioned that they have done compliance runs for NV that include some proportion of coal generation. Can you walk us through this analysis? More specifically, we anticipate a realistic scenario where one coal
-fired EGU, TS Power, would continue to operate in NV past 2030 since it’s a fairly new plant commissioned in 2008. We are unable to derive a reasonable scenario that meets the 2030 NV goal with this plant still in operation. Does EPA have any suggestions as to how NV could reasonably meet the goal with this plant in operation? Our analysisJKM Draft 08/ 1 7/2014

2 suggests that renewables generation would have to increase by 63% above EPA’s goal calc ulation to compensate for this coal generation, which seems unrealistic and exceeds our RPS of 25%. f. Non -Affected EGUs are not included in the numerator of the rate goal calculation. However, they are included in the denominator of the RE calculation. Why is this inconsistent approach used when performing the RE calculations vs. the rate efficiency calculations? g. Have the potential effects of long
-term drought in the west been factored into the rule? Under the proposed rule, i f drought conditions persist and reduce hydropower generation during the period of compliance, the lost generation would have to be quickly made up by one of the building blocks . This may not be possible given the long time frames necessary to shift power generation away from fossil fuel intensive sources . This unplanned for event could result in non
- compliance with either the interim or final goals . Has EPA made allowances for unanticipated events or conditions effe cting power generation that might prevent a state from attaining its goa l? h. For determining the energy savings from EE measures, does the expected lifetime of each EE measure have to be accounted for, or is some default program lifetime assigned to all EE programs? Are EE programs, and their associated electrical generation savings rates, expected to be maintained after the final goal year of 2029? i. The PUCN is considering NVE’s request to join the CAISO Energy Imbalance Market. Participation in this market will improve the efficiency of operation of the participating utili ties and reduce green house gas emissions. How does a program like this contribute to the EE building block? j. The PUCN is considering a Volt Var Optimization program which will reduce energy consumption on affected transmission and distribution circuits. How does a program like this contribute to the EE building block? k. How do solar thermal programs contribute to the EE Building Block? **2. Tribal issues:**  a. Where renewables are built on tribal land and purchased by a utility for use beyond tribal land, does that count toward RE?JKM Draft 08/ 1 7/2014

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**3. Enforceability:**  a. What is a federally enforceable plan for RE or EE measures? For example, is an RPS “federally enforceable”, or will EPA require that it be named as a third party beneficiary under power purchase agreements in order to e nforce them ? **4. Other issues:**  a. We have heard that some states are pushing back on the goal calculation for renewables. In the proposed rule, if it is generated in your state, you receive “credit” for it. But some states believe they should receive credit for out - of
- state renewable energy generation since they paid for it. If EPA ultimately agrees with the latter view, since it is one of the building blocks and will result in a complete overhaul of the calculation of states’ goals, shouldn’t that rule be re
- proposed rather than made final?