MEMORANDUM FOR: John Conti

Assistant Administrator for Energy Analysis

Alan Beamon

Office Director, Office of Electricity, Coal, Nuclear, and Renewables Analysis

FROM: Chris Namovicz, Renewable Electricity Analysis Team 

SUBJECT: AEO2014 Renewables Working Group Meeting 

This Renewables Working Group meeting on July 9, 2013 was the first of two, and focused on the 

assumptions and modeling efforts that EIA plans on using as the starting point for its AEO 2014 

renewable electricity projections. The meeting was attended by staff from EIA, DOE Offices of Energy 

Efficiency and Renewable Energy and Policy and International Affairs, National Laboratories, and 

stakeholders from industry trade groups. The meeting was held in the Forrestal Building, and included 

participation via a teleconference and web-cast.

Chris Namovicz of EIA led off the meeting by reviewing the roll-out for AEO 2013. Chris noted that the 

document was divided into several sections and released over a period of a few weeks. While there was 

still an early release of the Reference case in December, there were no significant changes to this 

Reference case in the final release during April and May. Chris noted that this staged release would 

likely be the model used to release the AEO 2014. He also noted that because of its late passage, the 

AEO 2013 Reference case did not include the PTC extension, but that the final release did contain a case 

examining its impact, and that this case would serve as a “current laws” Reference case for post-AEO 

analyses.

Chris and other EIA staff then discussed various updates to the model structure being worked on for 

AEO 2014. Chris noted that EIA had lost its primary biomass analyst, but that we are still planning on 

including a fully endogenous version of POLYSYS in the NEMS model for AEO 2014 to improve the 

modeling of biomass resources for the power sector and for the production of cellulosic biofuels. In 

response to a question from an EIA stakeholder, Chris noted that we would not likely have a full 

accounting for conventional crops, such as corn or soy, for the AEO 2014, but that work would continue 

on the project to ensure their inclusion.

Gwen Bredehoeft discussed work she is doing to improve the interface between the electricity dispatch 

models and end-use solar market. Currently, the ECP and EFD dispatch models do not see an accurate 

representation of the time-of-day and seasonal output from solar in the end-use markets. Gwen will be 

adjusting the interface with the Commercial and Residential buildings models so that the EMM will have 

a better representation of the impact this generation could have on electricity demand and supply at 

high penetration levels.

Chris Namovicz then moved to work EIA was doing to represent wind intermittency. The current work 

involves the modeling of operating reserves. Once operating reserves are represented in the EMM the 
model can evaluate the impact of variable, non-dispatched resources on the need for more or different 

kinds of capacity that may be used to provide spinning and other operating reserve services. Chris 

noted that the work was funded relatively late in the AEO process and may not be completed for the 

AEO 2014.

Owen Comstock provided an overview of work being done to model end-use solar. Owen noted that 

there were no big projects in the works, but that they would be updating their core data sets for 

interconnection limits and baseline capacity and generation. A stakeholder asked about the financing 

assumptions used for end-use solar, and specifically if we modeled customer-owned or third-party 

leased systems. Owen noted that we do model customer-owned installations, but have considered 

moving the model to third-party leases, but did not expect to include this representation in the AEO 

2014. Another stakeholder noted that third party leases may account for as much as 70 percent of the 

current end-use market.

Michelle Adams updated the group on activities to develop hydro data for the EMM. Specifically, she 

talked about work to evaluate the FERC hydro relicensing queue to get a better handle on the current 

and future potential for capacity and energy “uprates” at existing hydro plants.

Chris Namovicz and Gwen Bredehoeft discussed policy issues that EIA expects to impact the AEO 2014. 

Chris noted that we will be including the PTC extension in the AEO 2014 Reference case, although the 

change in “in-service” eligibility might make it more difficult to evaluate the current project planning 

queue. Gwen noted that it is likely that there will be minor changes to state RPS policies this year and 

that none of the efforts to repeal these policies has succeeded so far. Finally, Chris noted that the 

President’s recently announced plans to address greenhouse gas emissions did not constitute formal 

government policy and would not be included in the AEO Reference case until they are formally enacted 

as regulations.

Gwen also addressed EIA efforts to identify near-term renewable electricity projects in the development 

pipeline. EIA includes all plants known to be “under construction” as part of the AEO. In addition, in 

previous years, EIA has included plants (especially renewables) facing near-term expiration of key 

Federal tax credits if they are reported to EIA as “having regulatory approvals”, but not necessarily 

under construction. This policy may need to be reconsidered in light of the changes to the PTC eligibility 

criteria. Gwen noted that our planned additions will be similar to AEO 2013, but that we are seeing a 

significant uptick in new solar construction.

Finally, Chris noted that we would not be updating the “SAIC/Beck” capital cost study for generating 

technologies in AEO 2014. Funding for this effort is not likely to be available every year, but that EIA 

would try to fund it every few years. In the interim, EIA will be looking for solid evidence of significant 

movement in the cost of different generation resources.