Why use scenarios?
The word scenario first appeared in opera circles in the late nineteenth century. Derived from the word scene, a scenario is a “sketch of the plot of a play.” How did a word used in opera circles become central to the language of planning?
The evolution comes from Herman Kahn, a military strategist at the RAND Corporation during the Cold War. In the ‘70s, corporate strategists picked up and expanded on his use of scenario planning. But the origin matters. To build a scenario, think about perspective and set the stage. Build an imagined future outcome and point the audience at what they need to see. A scenario should have a cohesive narrative. There should be a plot.
Why would planners more familiar with spreadsheets than playbills need to use scenarios? To help us explore alternatives. To compare and contrast one future possibility to another. In the comparison, we learn and create a narrative. We add detail to our future scene to help inform the audience. Scenarios build understanding. They teach us where to focus our efforts. Scenarios provide critical information to aid the region in navigating through a volatile and uncertain future.
The electric sector is in a time of transition. A wave of coal unit retirements will happen over the next decade. Climate change is altering when we get power from the hydro system. And policies designed to limit greenhouse gas emissions constrain how the electric sector expands the supply of electricity. Utilities and regulators are looking to replace coal with completely different generating technologies like wind and solar generation. The cost of building solar and solar with on-site batteries has fallen substantially. But relying more on new technologies requires changing how the electric grid operates. The expansion of the Western Energy Imbalance Market makes the operation of the Western electric grid more automated and intertwined. But it’s just a start on the scope of change needed to transform the way we generate electricity.
The future of Northwest utilities will be different than the past.
Exploring themes in the 2021 Power Plan
As we consider that future through the lens of the Northwest Power Act - the law that directs the Council on planning for the future of the electric system - four themes emerged:
- What is the role of the electric sector in future policies to further limit or reduce greenhouse gas emissions? Currently, creating electricity emits greenhouse gases. As we develop new clean resources like energy efficiency, greenhouse gas emissions are reduced. The electric sector can also play a role in reducing emissions in other sectors of the economy. For example, replacing gasoline-powered vehicles with electric vehicles results in a reduction in greenhouse gas emissions in the transportation sector.
- How will a change in generation technology affect our ability to meet the demand for electricity every hour of the day? Wind and solar generation produce power when the wind blows and when the sun shines, with limited ability to store that power. Hydro generation, which can complement renewable resources, produces power when there is enough water flowing down the river. These types of generation depend on the weather, which changes from year-to-year, month-to-month, and day-to-day. In our current system, we use natural-gas-fired and coal-fired generation to supplement weather-based generation. As these thermal generators retire, and with limits on new thermal generation, new technologies will need to support weather-based generation.
- Can evolving markets lower the cost and enable the grid’s technological transformation? Markets for electricity are complicated. They match a generator producing electricity with companies and people who need to use electricity. This can be done years, months, days, or hours in advance of when that need arises. The further ahead this arrangement is made, the more likely the estimate of the amount of electricity needed will be wrong. Adding to the complication are limits on the transmission system to move power from where it’s generated to where it’s needed. Applying modern computing and optimization to electricity markets improves how the existing system operates and helps identify where new generation and transmission can contribute the most value.
- And how will all of this impact the Bonneville Power Administration? Bonneville owns and operates more than three-fourths of the region’s transmission grid and sells electricity to the majority of the public utilities. Most of the electricity Bonneville markets comes from generators that do not emit greenhouse gases. The generation on the federal system can change the amount of electricity being generated from one minute to the next, which can complement technologies like wind and solar generation. Broad adoption of future markets for electricity would be impossible without the participation of Bonneville. Our region cannot be prepared for the future without Bonneville being prepared. And the Northwest Power Act requires the Council to focus on Bonneville’s role in the region’s future.
At our July meeting in Butte, Montana, we presented a recommendation on scenarios for the 2021 Power Plan. These scenarios were taken from a broad list of potential scenarios. But we recommend being selective in the scenarios included in the power plan to allow more time to build understanding and narrative. Our recommendation is a chance for us to share themes we expect the plan to explore.
It is also an opportunity to get feedback. Take a look at the recommended scenarios. Check out what we excluded. Let us know what you think.
July 2019 Scenario Information:
- Presentation related to scenarios given at Power Committee in July 2019
- Scenarios proposed for inclusion
- Scenarios NOT recommended for inclusion - these were considered by staff, but ultimately not recommended