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QUADRENNIAL ENERGY REVIEW ENERGY TRANSMISSION, STORAGE, AND DISTRIBUTION INFRASTRUCTURE Hederman dviser to the Secretary &D Infrastructure: A Federal Policy Perspective – October 28, 2015 rth America Conference gh, PA 1

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Quadrennial Energy Review

Quadrennial Energy ReviewEnergy Transmission, Storage, and Distribution InfrastructureWilliam HedermanSenior Adviser to the SecretaryEnergy T&D Infrastructure: A Federal Policy Perspective October 28, 2015 USAEE North America ConferencePittsburgh, PA1OUTLINEThe Quadrennial Energy Review

Policy considerations for low-carbon and Transmission, Storage and Distribution Infrastructue22Technology AdvancesSolar (central and rooftop)WindDemand-side Hydraulic fracturingIncreasing Energy ProductionNatural gas production growthOil production growthIntermittent renewablesDistributed generation/energy resourcesIncreased generation/production/demand efficiency Policy DevelopmentsCAFEClean Air Act -111 (d), otherClean Water Act/otherRFSRPS (state)RGGI (regional)Energy Security ChangesDecreased N. American energy imports Climate change impactsVulnerabilities more evident, including aging infrastructures, physical and cyber threats Increased interdependencies Increased energy support required by alliesFundamental Changes in the U.S. Energy Sector33Framing TS&D Infrastructure


Vulnerabilities and Disruptions: Natural Disasters Tornado and Hurricane Tracks, Wildfires, Earthquakes, and Coastal Inundation

Gulf Coast Electricity Substation Facilities Exposure to Storm Surge under Different Sea-Level Rise ScenariosBillion-Dollar Disaster Event Types by Year (1980-2014)

Increased Intense Precipitation Events(Heaviest 1% of All Daily Events, 1958-2012)

EarthquakesWildfiresTornadoesHurricanes5New Investment: ElectricityHistoric and Projected Expansion of Net Transmission Circuit Miles (1960-2015)

Reported Drivers of Projected Transmission Addition(2011-2015)6Highlighted Pipeline Reversals and Expansions Accommodating Increased Domestic and Canadian SupplyU.S. Crude Oil Production by PADDSupply/Infrastructure: Oil and Gas

7Supply/Infrastructure: RailCrude Oil by Train Loading (red) and Offloading (green) Facilities 2010Crude Oil by Train Loading (red) and Offloading (green) Facilities 2013

Class I Railcars of U.S. Crude Oil (Quarterly, 20092014)

Coal-Fired Power Plants Supplied by the Powder River Basin8

43210-1-2-3Henry Hub Price Differential ($/MMBtu)2002200320042005200620072008200920102011201220132014

ChicagoBostonWyomingNew YorkHoustonNorthern CaliforniaPittsburghWest TexasSouthern CaliforniaImportance of Gas Transmission Infrastructure9Leak Prone Pipes in Local Distribution SystemsMethane Emissions from Natural Gas Distribution Systems in Boston (2013)Expected Replacement Horizons for Select Utilities for Leak-Prone Mains (Forecasted Timeframe in Years)Utility CompanyService TerritoryStateForecasted Timeframe (years)Philadelphia Gas WorksPhiladelphia, PAPA84ConEdNew York, NYNY35PECOGreater Philadelphia, PAPA33PSE&GNewark, NJNJ30Pensacola EnergyPensacola, FLFL30Baltimore Gas CompanyBaltimore, MDMD30UGIRural PennsylvaniaPA27Consumers energyDetroit, MIMI25DTEDetroit, MIMI25National GridNew York, NYNY25Dominion Hope Gas Co.OhioOH20Yankee Gas Service CompanyRural ConnecticutCT20Peoples GasChicago, ILIL20National Grid Niagra MohawkRhode IslandRI19Peoples TWPSouthwestern PennsylvaniaPA19Peoples Natural Gas Co.Southwestern PennsylvaniaPA17National Grid Niagra MohawkSyracuse, NYNY16Columbia Gas of PennsylvaniaSouthwestern PennsylvaniaPA15Northern UtilitiesMaineME13CenterPointArkansasAR12

10Select RecommendationsGrid Modernization($3.5B)Grants for state and multi-state grid reliability planning ($300-$350M)Value new services and technologiesConduct national review of transmission plans and assess barriers to their implementation

SPR modernization and life extension ($1.5-$2B)G-7 Collective Energy Security InitiativeImplementation Grants for Energy System Hardening ($3-$5B)Rate Mitigation for accelerated NG distribution pipe replacement ($2.5-$3.5B)State Energy Assurance/Resiliency Planning Grants ($350-$500M, depending on 2 or 3 year cycle)Strategic Transformer ReserveASSETS grants for energy-intensive connector projects ($2-$2.5B)

Enhance North American energy integration through cooperative measure with Canada and MexicoCaribbean Renewables/LNG project planning support