Portland General Electric Co · NYSE:POR
Portland General Electric — Technical Presentation (April 2015)
31 slides from Portland General Electric's technical presentation, April 2015
Slide 1: PGE Forecast Review Summary
PGE FORECAST REVIEW SUMMARY Mark Quan Itron, Inc. [email protected] April 2015
Slide 2: Purpose of Load Forecast Model Review
Purpose of Load Forecast Model Review PGE’s load forecast model and approach has been used for many years. While the load forecast model has an established history and performed well, relationships between deliveries and drivers have changed. PGE recognized the potential for refinement and fur
Slide 3: Forecast Review Summary
FORECAST REVIEW SUMMARY » 4th Quarter 2014 Model Review » Energy Forecast • Residential Models - Customer Models (2 Connects, 2 Building Permits) - Energy Models (7 UPC Models) • Commercial Models - Customer Model (1 Connects Model) - Energy Models (11 Sector Models) • Industrial Models - Manufactur
Slide 4: Energy Forecast: Residential Models
ENERGY FORECAST: RESIDENTIAL MODELS
Slide 5: PGE Residential Forecast
PGE RESIDENTIAL FORECAST PGE Residential Annual Growth Forecast Rates 2015-2019 Average 0.52% 2015-2025 Average 0.73% 2012 National Survey* 0.95% 2013 National Survey* 0.78% 2014 National Survey* 0.65% * Itron 2014 survey of utility 2014 forecast growth rate. 64 utility * Itron 2012, 2013, and 2014
Slide 6: Common Residential Drivers
COMMON RESIDENTIAL DRIVERS PGE Drivers Itron 2012 Benchmark Survey 77 Utility Responses (PGE not included) Population/Households is most common driver (21%) PGE uses Unemployment (5%) and Housing Information (11%)
Slide 7: Residential Findings
RESIDENTIAL FINDINGS Residential Commercial Industrial Customer Method Customer Method Energy Method Survival Equation - Minority Survival Equation - Minority Econometric - Normal Economic Variables – Normal/Refine Energy Method Energy Method Growth Rates – High Econometric - Normal Econometric – No
Slide 8: Improve Weather Response Modeling
IMPROVE WEATHER RESPONSE MODELING UPC Vs Average Temp Monthly Use Per Customer (SF, SH) 2013 2000 1990 Average Monthly Temperature
Slide 9: Energy Forecast: Commercial Models
ENERGY FORECAST: COMMERCIAL MODELS
Slide 10: PGE Commercial Forecast
PGE COMMERCIAL FORECAST PGE Commercial Annual Growth Forecast Rates 2015-2019 Average 0.39% 2015-2025 Average 1.03% 2012 National Survey* 1.20% 2013 National Survey* 0.93% 2014 National Survey* 0.71% * Itron 2012, 2013, and 2014 survey of utility * Itron 2014 survey of utility 2014 forecast growth r
Slide 11: Common Commercial Drivers
COMMON COMMERCIAL DRIVERS PGE Drivers Itron 2012 Benchmark Survey 77 Utility Responses (PGE not included) 37% use residential and/or employment information (similar to PGE)
Slide 12: Commercial Findings
COMMERCIAL FINDINGS Residential Commercial Industrial Customer Method Customer Method Energy Method Survival Equation - Minority Survival Equation - Minority Econometric - Normal Economic Variables – Normal/Refine Energy Method Energy Method Growth Rates – High Econometric - Normal Econometric – Nor
Slide 13: Top Level Stability
TOP LEVEL STABILITY Key Variables Seasonal Binaries Non-Manufacturing Employment Monthly Energy HDD Spline CDD spline Simplicity in model structure Identify strong economic variables Sectors may be shared out using a top-down method
Slide 14: Energy Forecast: Industrial Energy Models
ENERGY FORECAST: INDUSTRIAL ENERGY MODELS
Slide 15: PGE Industrial Forecast
PGE INDUSTRIAL FORECAST PGE Industrial Annual Growth Forecast Rates 2015-2019 Average 2.49% 2015-2025 Average 2.26% 2012 National Survey* 0.84% 2013 National Survey* 0.91% 2014 National Survey* 0.61% * Itron 2014 survey of utility 2014 forecast growth rate. 62 utility * Itron 2012, 2013, and 2014 su
Slide 16: Common Industrial Drivers
COMMON INDUSTRIAL DRIVERS 17% 46% 12% Production/Output Employment PGE Drivers Price Other 25% Itron 2012 Benchmark Survey 77 Utility Responses (PGE not included) 25% use employment information (similar to PGE)
Slide 17: Industrial Findings
INDUSTRIAL FINDINGS Residential Commercial Industrial Customer Method Customer Method Energy Method Survival Equation - Minority Survival Equation - Minority Econometric - Normal Economic Variables – Normal/Refine Energy Method Energy Method Growth Rates – High Econometric - Normal Econometric – Nor
Slide 18: Changing Relationships
CHANGING RELATIONSHIPS Industrial Class Energy (less large customers) GDP Non-Manufacturing Employment Total Employment Manufacturing Employment Index (1990 = 1.0) Changing Economic Relationships
Slide 19: Energy Forecast: Forecast Adjustments
ENERGY FORECAST: FORECAST ADJUSTMENTS
Slide 20: Price Elasticity Benchmarks
PRICE ELASTICITY BENCHMARKS PGE Elasticity Range Class Low Average1 High Benchmark Average2 Residential 0.000 0.101 0.163 0.150 Commercial 0.000 0.037 0.339 0.188 Industrial 0.000 0.016 0.117 0.193 (1) Sales weighted average. (2) Based on 91 electric company responses Range of Short Term Price Elast
Slide 21: Accounting for DSM
ACCOUNTING FOR DSM PGE Method Itron, 2013 Forecasting Benchmark Survey
Slide 22: System Energy Forecast
SYSTEM ENERGY FORECAST 2015 – 2025 Forecast* Energy 1.12% Customers 1.07% Res/Com/Ind Total* Lumpy forecast 1992-2013 Energy Growth 0.97% captures leap year 2000-2013 Energy Growth 0.21% effect 2013 Regional Comparison 1.3%-2.0% EIA - US 0.8% Global Insights – US 1.5% Stable growth rates *Forecast f
Slide 23: Adjustment Findings
ADJUSTMENT FINDINGS Residential Commercial Industrial Key Industrial Findings Customer Method Customer Method Energy Method Survival Equation - Minority Survival Equation - Minority Econometric - Normal No changes. Price elasticities are within industry range Economic Variables – Normal/Refine Me
Slide 24: Peak Forecast
PEAK FORECAST
Slide 25: Peak Forecast
PEAK FORECAST Year Peak Forecast Growth 2016-2025 Annual Average = 1.02% 2016 0.54% 2017 0.68% PGE growth rate projections above 10- 2018 0.86% year average projections 2019 0.90% 2020 1.26% PGE forecast accelerates through the 2021 1.18% short-term forecast and flattens with 2022 1.18% the lo
Slide 26: Peak Forecasting Methods
PEAK FORECASTING METHODS 59% of companies use PGE econometric models to forecast monthly peaks 8% of companies apply a load factor method to develop monthly peaks (PGE approach) Itron, Review of PJM Models, Phase 1 Load Forecast Model Evaluation, 2010 26% of companies use load shapes
Slide 27: Peak Findings
PEAK FINDINGS Residential Commercial Industrial Customer Method Customer Method Energy Method Survival Equation - Minority Survival Equation - Minority Econometric - Normal Economic Variables – Normal/Refine Energy Method Energy Method Growth Rates – High Econometric - Normal Econometric – Normal Ke
Slide 28: Econometric Peak Model Structures
ECONOMETRIC PEAK MODEL STRUCTURES Common Forecasting Structures Increasing Complexity Peak = f(HDD, CDD, Economic Driver) Peak = f(HDD, CDD, System Energy) Peak = f(HDD, CDD, Summer Energy, Winter Energy) Peak = f(HDD, CDD, End-Use Trends) Advantages of an econometric model HDD and CDD allow for w
Slide 29: Summary
SUMMARY
Slide 30: Overall Findings
OVERALL FINDINGS Residential Commercial Industrial Customer Method Customer Method Energy Method Survival Equation - Minority Survival Equation - Minority Econometric - Normal Economic Variables – Normal/Refine Energy Method Energy Method Growth Rates – High Econometric - Normal Econometric – Normal
Slide 31: PGE Next Steps
PGE Next Steps • Implemented refinements to the short-term energy model including improved weather and economic drivers and shortening of estimation Dec 2014 Forecast period • Implement refinements to peak demand model and long term energy June 2015 growth rates Forecast • Details of load forecast m
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