DOE NNSA – Electric Supply (Los Alamos Power Pool)

DOE NNSA – Western Area Power Administration Electric Supply Alternative

DOE NNSA – Regulatory Intervention Activities (FERC Docket No. ER05-741-000)

Twin Cities Army Ammunition Plant

Volunteer Army Ammunition Plant
 

Utility Support Services

Utility Support Projects

Keres supported NNSA in assessing power supply resource options to address concerns related to the vulnerability of the power grid and also to meet projected increases in power requirements at LANL. A decision was reached to go forward with some on-site generation projects. One project involved the rehabilitation of the TA-3 Plant Unit 3, providing 12.5 MW of capability. A second project will add a 20 MW combustion turbine at TA-3. Also, arrangements were made for the LAPP use of two 1.0 MW diesel engine generators which are capable of synchronous operation with the grid. When fully operational in FY2006, the combination of the new and existing units at Los Alamos will provide 45 MW of on-site capability.

Keres also supported NNSA efforts to secure renewable energy supply, with the goal of having arrangements finalized for securing as much as 7.5% of the LANL energy requirements from wind sources in FY2004. Western in FY03 issued an RFI for renewable energy. This confirmed that a number of potential suppliers had interest. Subsequently, an RFP was eventually issued but due in part to uncertainties regarding extension of Federal Tax Credits for renewable energy sources the bids received were rejected. As an interim measure, in March of 2005 a decision was made to obtain Renewable Energy Certificates (RECs) through joining in a procurement effort of Western for the Department of Defense. This led to a five-year commitment commencing in August 2005 to annually purchase approximately 12 GWh(3%) of the LANL requirements from Sterling Planet, Inc. at a cost of $1.00/MWh.

Keres supported NNSA in a number of interim steps to upgrade the load serving capability of the northern New Mexico transmission system as well as upgrade the two lines into Los Alamos. An agreement was reached with PNM to add the Norton 115 kV switchyard. Subsequently an agreement was reached to turn over ownership of the portion of the DOE transmission line between Santa Fe and the new Norton 115 kV Switchyard. This was done in exchange for PNM turning over ownership to DOE of their ETA-TA3 transmission line and the associated ETA line terminal equipment.

Keres also assisted NNSA in conducting extensive transmission planning studies to determine the optimal way to meet future needs of LANL, LAC and the Northern New Mexico system. These studies led to a decision to pursue the addition of a third line into Los Alamos from the PNM system. The project subsequently proceeded in three phases. The first phase involved the addition of the West Technical Area (WTA) 115/13.8 kV Substation, which was completed at Los Alamos in FY2003. The second phase involving addition of the South Technical Area Substation (STA) and the eight mile STA–WTA 115 kV line should be completed in FY2006 using line item funds. The final phase is the ten mile STA–Norton section now scheduled to be completed with County funds in FY2007.

In FY03, FY04 and FY05, Keres supported NNSA and the Air Force in evaluation of on-base utility privatization proposals. It was the consensus of those involved in the review of process that the privatization of the electric, natural gas, water and wastewater systems on KAFB would place an unacceptable burden and security risk on the base and NNSA. It was also concluded that privatization would substantially impair the mission of DOE-NNSA and heighten the risk of compromising classified operations and resources. A waiver was requested, and in November 2005 the Deputy Assistance Secretary of the Air Force certified that the utility systems on KAFB were exempt from further privatization action.

In FY2003, Keres also supported NNSA efforts to secure renewable energy supply, with the goal of having arrangements finalized for securing as much as 7.5% of the KAFB energy requirements from wind sources in FY2004. Western in FY03 issued an RFI for renewable energy. This confirmed that a number of potential suppliers had interest. Subsequently, an RFP was eventually issued but due in part to uncertainties regarding extension of Federal Tax Credits for renewable energy sources the bids received were rejected. As an interim measure, in March of 2005 a decision was made to obtain Renewable Energy Certificates (RECs) through joining in a procurement effort of Western for the Department of Defense. This led to a five-year commitment commencing in August 2005 to annually purchase approximately 6.7 GWh(3%) of the Sandia Site requirements from Sterling Planet, Inc. at a cost of $1.00/MWh.

In 2005, Keres assisted DOE, Western and LAC with intervention support to maintain PNM transmission rates at a fair and reasonable level. Transmission service customers and PNM entered into negotiations and eventually reached a settlement of the case in January 2006. PNM’s rate case was filed March 30, 2005 and because of the detailed protest filed by DOE/NNSA with support from Keres, setting out valid reasons for suspension, the rates were suspended for six months. The six-month delay in the effective date of the increase resulted in a one-time avoided cost savings for NNSA of $400,000. The $10.5 million reduction in PNM’s requested ATRR results in an ongoing avoided cost savings for NNSA of approximately $500,000 per year.

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