CLEAN POWER PLANReducing Carbon Pollution FromExisting Power PlantsSPORD - P&RGuam Power AuthorityAgenda•Governance & Environmental Stewardship•Strategic Initiatives–Integrated Resource Plan–Grants–Organizational Infrastructure Development–New Guam PUC Dockets•Questions, Requests, & IssuesSLIDE - 2Governance•GPA’s Balanced Scorecard has a section forEnvironmental Stewardship•GPA has adopted several key strategicinitiatives to reduce its environmentalfootprint•These initiatives are heavily supported bySPORD and its internal and externalstakeholder partners3Strategic Initiatives•Integrated Resource Plan Initiatives–Demand-Side Management (Energy Efficiency)–Renewable Energy (Active Energy Generation Substitution)–Replacement of Legacy Generation Fleet with More EfficientGeneration Complying with New and Anticipated Emissions Standards–Move to LNG (gas)–Leveraging Smart Grid Grant Technologies–Demand Response–Energy Storage System•Grants•Organizational Infrastructure Development•New Guam PUC Dockets4Demand-Side Management•DSM Programs–Large Civilian Customers–Federal Customers–Public Streetlights•IN 2009, GPA partnered with 2 ESCOs to deliverEnergy Conservation Measures to Customers–Johnson Controls Inc.–SAIC–Contracts in final year and up for re-procurement5Large Civilian Customers DSM Projects•Projects–ARRA Streetlight Retrofit–ARRA GovGuam Building Retrofits Phase 1–ARRA GovGuam Building Retrofits Phase 2–GIAA Energy Conservation Measures–Solar Water Heating Rebate Pilot Program6Large Civilian Customers DSM Projects7•$15 MM Federal Grant Funded–Streetlight Retrofit–GovGuam Building Retrofits Phase 1–GovGuam Building Retrofits Phase 2–Solar Water Heating Rebate Pilot Program•Customer Funded–GIAA Energy Conservation MeasuresVirtual Power Plants•Large Civilian CustomersEnergy Conservation Measures (Projects)Estimated AnnualEnergy Savings (kWh)ARRA Streetlight Retrofit529,906ARRA GovGuam Building Retrofits Phase 1 4,008,107ARRA GovGuam Building Retrofits Phase 2 790,032GIAA Energy Conservation Measures 4,866,667Solar Water Heating Rebate Pilot Program 112,016Total:10,306,728Environmental Impact EquivalencyAnnual EnvironmentalBenefitsLbs. of CO2 Saved17,237,156Acres of Trees Planted Equivalent2,103Automobiles Removed From Roadways1031Gallons of Gasoline Saved 936,9758Pending Large Customer Projects•Partnership with Guam Waterworks Authority–Interruptible Load (Reduce Generation CapacityRequirements)–DSM MOU9Federal Customer DSM•Department of the Navy–Letter Of Intent to Award Utility Energy Services Contract (UESC) toGPA–Preliminary Audit Performed at DoD Facilities–Potentially More than $7 MM in projects•Army Corps of Engineers–Awarded GPA a UESC–Preliminary Audit Performed (Includes PV System)–In Discussions•FAA–Performed Preliminary Audit–Insufficient Number of Projects to Proceed10Public Streetlights•Guam Law requires the Department of PublicWorks/Guam Power Authority to replacelegacy streetlights with efficient LEDtechnology including the set up of a SpecialPurpose Entity (SPE)•Guam Power Authority has begun to includeLED lights in its streetlight inventory11Renewable Energy Program•Phase I Renewable Acquisition–Awarded Contracts•25 MW Solar PV (NRG) - Commercial Operation beforeJanuary 2015•9.3 MW WTG (PGR) -Commercial Operation by July 2016•Phase II Renewable Acquisition (40 – 45 MW)–Procurement Announced July 1, 2014 at URL:http://guampowerauthority.com/gpa_authority/procurement/gpa_current_rfps.php12Renewable Energy Program•GPA Solar PV Program–Approved by Guam PUC–Procurement Announcement Imminent•Week of 8 September 2014•Partnership with GCC–Covered in more Detail in APPENDICES13Renewable Energy Program•Phase III Renewable Energy Acquisition–GPA and DON partnership•Up to 66 MW in potential renewable energy projects•Joint Preliminary Evaluation of Several Potential DoD sites forRenewable Projects (In-Progress)•Potential Partnership Models–Amendment to Utility Services Agreement (USA)–New Green Energy Rates Approved through Guam PUC–Utility Energy Services Contracting–Leaseholds–All of the AboveSLIDE - 14Integrated Resource Plan•Main Elements–Replace Existing Generation with New Generation•More Efficient•Less costly to Operate & Maintain•Outsourced Operations–Convert from Residual Fuel Oil (RFO) to LNG (Gas)–Diversify Energy Production from 97% to 100%RFO to Renewable Energy, ULSD, and GasSLIDE - 15Generation: Changing of the Guard•The critical insight of the IRP is not moving togas. It is changing to more efficientgeneration.SLIDE - 16Retooling the Generation Mix•Reduction inConventionalInstalledGenerationSLIDE - 17NameplateCapacity (MW)YearEffectiveUnavailable for DispatchMarbo CT162014Dededo Diesel Power Plant102014Dededo CT (single Unit)232014Subtotal49Planned Removal from ServiceTanguisson Power Plant532015Cabras 1&2132< 2022Cabras 3&4 (Candidate)78.42022Subtotal263.4Total312.4New Generation120 201960 2021Total180Generation Plant

Removal From ServiceDual-Fired (DFO-Gas) CombinedCycle Combustion Turbines

Additions (Conventional)Moving to Gas & ULSD•GHG gasEmissionReductionStrategy:–IncreaseEfficiency–Fuel SwitchSLIDE - 18NameplateCapacity (MW)YearEffectiveExisting GenerationTEMES CT402019MEC 8&9882020Subtotal128New Generation120 201960 2021Subtotal180Total308Generation Plant

Retrofitted for ULSD & Gas AdditionsDual-Fired (DFO-Gas) CombinedCycle Combustion TurbinesMoving to Gas•Opportunities–Hub for Natural Gas for Micronesia–Facilitate move:•Away from Diesel Fuel Use for Other Island ElectricityGeneration•Towards Natural Gas and Electricity for Land Transportationand Heavy Equipment•Towards Natural Gas for Ocean Transportation•Towards a Fuel Cells as Distributed Generation at SubstationsSLIDE - 19Leveraging Smart Grid Grant Technologies•Submitted Metrics & Benefits Report to DOE–Guam Power Authority Narrative Case Study:Deferral of Generation Capacity Summary•Potential Energy and Capacity SavingsSLIDE - 20SA/DA/DSM ProjectsSLIDE - 21Prepay Project1. Participation in prepaid energy service results inan average reduction in energy usage of 11%–(Ozog, Michael. 2013.The Effect of Prepayment on Energy Use (DEFG’s Prepay Working Group).Washington, D.C.: Distributed Energy Financial Group LLC. Summary available fromhttp://defgllc.com/publication/the-effect-of-prepayment-on-energy-use/ )2. Over a fifth of a utility’s consumer base couldswitch to a prepaid electricity account within afairly short period of time (2-3 years).–Wimberly, Jamie. 2014. Prepay Energy at an Inflection Point (DEFG’s Prepay Working Group). Washington,D.C.: Distributed Energy Financial Group LLC. Summary available fromhttp://www.ballardcreative.com/clients/paygo/ecopinion-consumer-survey-18-prepay.pdf. Page 8SLIDE - 22Prepay ProjectSLIDE - 23Issues:Prepay $25 upfront Registration fee and $75 upfrontdeposit requirementretarding penetration among customersDemand Response•Smart Grid Grant infrastructure provides GPA withcapability for demand response for all customers•All residential meters and most small commercialcustomers have remote disconnect/reconnect feature•All smart meters support TOU and CPP rates•Smart meters have zigbee communications capabilityto support Home Area Networks (HAN)•Capability to support Load Control•Task order signed for DRSLIDE - 24Demand Response•DR strategic goals–Peak shifting–Valley filling–Conservation–Load Building (Electric Vehicles)SLIDE - 25Energy Storage System•Benefits–Reduces 77% of UFLS outages–Decreases Spinning Reserve Requirements–Enhances System Capability for Integration with Non-Firm Renewable EnergyGenerators–Reduces Fuel Costs•40 MW, $35 MM Bond Project Approved (Phase I)•Multiple Phases–40 MW ESS supports up to 90 MW Non-Firm Renewables–Latter Phases investigate Load Leveling•Requires GPA Control of:–Smart Inverters–Frequency and Voltage Ride-through SettingsSLIDE - 26Grants•$1.505 MM WTG Grant (OIA)–EIS and Permitting Completed–Construction Bid Awarded–275 KW WTG with Capability to Cant Down and Lock for Storms•$2 MM Proposal (1701-1600)–Fund Strategic Plan for Increasing Solar Penetration for Guam–Stakeholder-based–Awaiting Decision–Partners:•Solar Electric Power Association•ScottMadden•Want More Grants Awarded to GPA!SLIDE - 27Organizational Infrastructure Development•SPORD Organizational InfrastructureDevelopment (DSM & Renewable Energy)–7 SPORD Technical Staff•5 Professional Engineers (Electrical/Mechanical)•3 Certified Energy Managers (CEM)•5 Certified Energy Auditors (CEA)•2 certified Building Analyst Professional (BPA)•6 Enrolled in SEI Solar Professionals Certificate ProgramSLIDE - 28New Guam PUC Dockets•PUC Docket 13-14 Demand Side Management–The PUC ALJ shall work collaboratively with GPAand Lummus Consultants to develop andimplement a DSM and Energy Efficiency programSLIDE - 29Questions on EPA Plan•Is the federal government going to provide any fundsor subsidy to Guam to off-set the cost that GPA mayincur as result of implementing EPA’s plan?•What is the “consistent national formula” (mentionedin Slide 12) used to calculate each of the proposedstate GHG emissions goals? Will this be the sameformula used to determine the emission rates (or stategoal) for Guam?•Please clarify, statement:–“In 2030, total amount of Carbon emission will be 30% lessthan 2005 level”30GPA Requests (SPORD)•GPA-EPA Partnership should Lead a Stakeholder-basedProcess that:–Mitigates Downsides–Mitigates Costs & Risk–Maximizes GHG Reductions–Reduces Total Energy Costs for Guam–Promotes a Healthy Power Grid–Serves as an Economic Catalyst•Projects need external Funding–GPA has not provided funding for large DSM Program–$15 MM Federal Grant Funding–$11.9 MM Customer Funding–$1.505 MM WTG Funding–Demand Response not fundedSLIDE - 31APPENDICESSolar Partnership Model32Solar Partnership ModelBuilding Customer Partnerships to deploy solar forthebenefit of all customersA GPA Solar Leadership ModelKey Elements of the ModelThe Plan•Add approximately 10-30 MWsolar over the next 30 months•Pilot the Partnership Model withGuam Community College (1-3MW)•Add incremental blocks (~5MW)at set intervalsRationale•Fits with overall GPA goals•Native load at risk from outsidesources•Net metering follows from thirdparty installations•Pilot allows go no/go point•Process controlled by GPA•Stepped MW blocks reduce riskand help with price mitigation34Deploying Solar for a Win-Win

Solar PPA

Fuel

System Charge System Charge Solar PPA

Price per kWhGreen Partner compensation?All customer benefit?Solar Partnership ModelNot to Scale35Program Overview – Phased ApproachStep 1RFIPre-qualifybiddersStep 2RFP GCCPilot siteStep 3PPA forGCC SolarStep 4GPArecruitssites in 5-7MW blocksStep 5RFP5 MWblocksStep 6PPA for~5MW ofadditionalprojectsRepeatsteps 4 and6 through30 MWHard stop depending on priceMulti-step Bid36Program Overview – ConsiderationsQualified bidder list (RFQ) will need to be refreshed after first year oras appropriate (can use QBL for multiple RFP’s depending on timing)Pricing should decline as developers gain market knowledgePricing will increase as optimal locations are exhausted; allows GPA tomonitor transitions and assess cost to resource fitGPA will recruit and evaluate which sites are used37Outcomes• Opportunity for all ratepayers to benefit from solar• Moderates net-energy metering concerns• Scalable with cost effective sitesRates• Creates a long-term solar partnership• Revenue from solar hosting• Visibility as community/solar leadersHost Customer• Integrates solar into GPA portfolio• Moderates current fuel price risk• Creates opportunity for asset control and system integrationResource• Direct channel for equipment standards and performance assurance• Creates opportunity for solar asset ownership (ownership-flip PPA)• Converts a variable, pass-through fuel cost into GPA asset and revenueOwnership38Move to LNG (Gas)•2012 IRP recommended GPA switch from fullypetroleum based energy production to a morediversified portfolio39