Utility and Infrastructure Board (June 2017 - Present)

CITY COUNCIL and UTILITY AND INFRASTRUCTURE BOARD SPECIAL MEETING August 14, 2018 City Council Chambers 400 East Military, Fremont NE SPECIAL MEETING – 6:30 P.M. AGENDA REGULAR MEETING: 1. Meeting called to order 2. Roll call 3. Integrated Resource Plan Presentation – breakdown of future power generation (staff report) 4. Discussion & public comment 5. Adjournment  STAFF REPORT TO: Mayor, City Council and Utility and Infrastructure Board FROM: Jeff Shanahan, Power Plant Superintendent DATE: 8-14-18 SUBJECT: DRAFT Integrated Resource Plan Recommendation: Review DRAFT of Integrated Resource Plan BACKGROUND: Review DRAFT of Integrated Resource Plan (IRP).  Integrated Resource Plan 2018 to 2022 City of Fremont, Nebraska 2018 Integrated Resource Plan Page 1  Section 1 Introduction 2 Public Works Oversight 3 Community Outreach 4 History 5 Community and Customer Profiles 6 Electrical Distribution System 7 Environmental 8 Existing Supply 9 Fremont Electrical Load and Forecasted Growth 10 Conservation and Demand Side Management 11 Excess Energy 12 Summary 2018 Integrated Resource Plan Page 2 Disclosure This document contains estimates and forward looking trends and events, it is important to note that future events will affect this document and possibly alter the results of this document. Acknowledgement Electric production resource planning at the City of Fremont is an ongoing process. This integrated resource plan (IRP) is designed to evaluate the City’s electric production resources and the City’s electrical needs in the present as well as in the future. 2018 Integrated Resource Plan Page 3  1: Introduction The City of Fremont (COF) owns its municipal electric system for the benefits of its ratepayers. The Utilities and Infrastructure Board (UIB) has oversight over the electric system and makes recommendations to the COF City Council whom has the ultimate decision making authority. The COF electric production is part of a rapidly changing electric production environment. The electric industry is constantly changing; there are technological advancements, regulatory changes and customer preferences. COF understands it has to embrace and manage the changing environment, but still hold true to the mission of providing rate payers the safest, most reliable and cost effective energy possible. COF has made a dramatic shift in its generating assets from primarily fossil fuel by adding renewables such as wind and solar. The COF is participating in a long-term purchase power agreement with NextEra Energy in the Cottonwood Wind Project, LLC for 41 MW’s of wind energy. The COF also recently installed a community solar farm located in the COF that has an output of approximately 1.5 MW’s and is in the construction phases of building a second community solar farm totaling 1 MW. When it is finished, the total community solar output will be approximately 2.5 MW’s of electric power. 2: Public Works Oversight The Utilities and Infrastructure Board The Utilities and Infrastructure Board (UIB) consists of five (5) citizens appointed by the Mayor and approved by the City Council, to serve as oversight of public works activities. Each member serves a five- year term. The UIB makes recommendations to the COF City Council concerning public works activities. The UIB meets the second and last Tuesday of every month at 4:00 PM in the Municipal Building at 400 E. Military Fremont, NE. These meetings are open to the public and the public is encouraged to attend. The meetings generally consist of financial, project, and department updates. The City of Fremont City Council The COF’s governance structure consists of an elected Mayor and eight (8) elected City Council members. There are two councilmembers from each of four (4) voting wards, shown below. 2018 Integrated Resource Plan Page 4 The City Council meets on the second and last Tuesday of every month at 7:00 PM in the council chambers at the Fremont Municipal Building 400 E. Military Fremont, NE. The City Council receives recommendations from the UIB and acts on those recommendations. These meetings are open to the public and the public is encouraged to attend. 3: Community Outreach It is a priority of the COF to notify and engage the public regarding City projects. The COF uses several different methods of communication to provide ratepayers and the public with information on a variety of topics. The COF publishes a newsletter that is included in the monthly billing statements that updates ratepayers about City activities, safety topics and other related topics. A monthly electronic newsletter is also published and sent to customers that have provided the utilities with their e-mail address. This newsletter includes items such as updates for the community solar projects, links to engineering assistance, and natural gas safety. In addition to the newsletter, the COF utilizes social media as a means to notify customers of upcoming events and programs along with outage and storm damage updates. For further information, visit the COF Facebook page. https://www.facebook.com/City-of-Fremont-NE-273002179432953/ The COF provides a link on its web site (www.fremontne.gov) to information about safety and energy related topics. COF meets with community civic groups, public forums and educational institutions to engage the public and inform them of upcoming COF projects and activities. These events have been very helpful with the implementation of the community solar projects. 2018 Integrated Resource Plan Page 5 Annually, the COF has a booth at the Fremont Home Show. The booth is staffed with City employees that are available to discuss various topics concerning City functions. In addition to the booth, COF management participates in town hall type meeting with topics ranging from long term planning to community solar and wind projects, these meetings are open to the public and the public is encouraged to attend. COF staff also participates in a weekly radio session that provides information on various City topics. COF staff participates in the “Ecology Fair” sponsored by Keep Fremont Beautiful each year for middle school children. COF staff also participate with local elementary schools and provides an educational tool called the “Energy Detective” for elementary educators to utilize. Both teachers and parents have been very supportive of this program. The COF offers many opportunities for internships, school to career, and tours for students interested in the energy sector or to further their education. The COF annually provides tours of its facilities to students from the local high school and university. The COF staff also participate in mock interviews with the high school and local community college students. In addition to the City Council meetings and the Utility and Infrastructure Board meetings, the City held a public meeting to discuss the Integrated Resource Plan and took public comments prior to official acceptance by the City Council. 4: History: The COF electric system has been in operation since 1885, when the first “Light Plant” came online. The original light plant provided the streetlights from dusk to approximately 11:00 PM. The first power plant was located at 8th and Park St. (Downtown) Fremont. The plant began 24-hour electric service in 1907. The plant underwent many improvements resulting in five (5) steam driven turbine-generating units. The plant continued to operate until 1976, when it was officially decommissioned. LDW Unit 6, located at Lon D. Wright Power Plant (LDW), started construction in 1955 with commercial operation beginning in January 1958. Shortly after LDW Unit 6 construction and commissioning was completed, construction on LDW Unit 7, adjoining the existing LDW Unit 6, came on line in 1962. During this period, the downtown plant and the LDW units served City customers. In 1970 – 1971, the COF authorized the purchase and installation of LDW Unit 8, a 91.5 MW steam turbine generator and associated boiler and balance of plant equipment. LDW Unit 8 completed successful commissioning and established a commercial operation date in December 1976. Once LDW Unit 8 came online, the downtown plant was shut down and eventually all equipment was removed. The COF sold the downtown facility, and a developer repurposed the building as an apartment complex. In 2003, the Derril G. Marshall Generating Station (a simple-cycle gas combustion turbine) went into service. The primary purpose of this plant to provide electric energy during peak period and to maintain electric reliability when LDW units are offline. 2018 Integrated Resource Plan Page 6 In 2017, the COF entered into a purchase power agreement for approximately 41 MW of wind energy from the NextEra Cottonwood Wind Project, LLC., near Blue Hill Nebraska. In 2018, the COF built two community solar farms in the City. Ratepayers can subscribe to solar energy either by buying panels or by buying solar energy shares. 5: Community and Customer Profiles The COF is located in the Platte River Valley in Dodge County in eastern Nebraska. Fremont is a first class City as defined by the State of Nebraska. The COF serves a diverse customer base comprised of residential, commercial, and industrial electrical loads. Climate 2017 Data Table 5-1 Average Daily Temperature Average Low Average High Deg. F Average Precipitation Average Snowfall Deg. F Inch Inch January 13 33 .17 6 February 17 38 .83 7 March 27 50 1.93 6 April 38 63 2.91 2 May 50 74 4.21 0 June 60 83 4.72 0 July 65 87 3.62 0 August 62 85 3.43 0 September 52 77 3.15 0 October 40 65 2.13 1 November 28 49 1.38 3 December 16 34 1.02 7 Historic Growth – Table 5-2, below shows the population for Fremont and Dodge County from 1870 to 2016 (est.) based on U.S. Bureau of Census data. Table 5-2 2018 Integrated Resource Plan Page 7  Year City of Fremont Dodge County 1870 1195 4212 1880 3013 11263 1890 6747 19260 1900 7241 22298 1910 8718 22145 1920 9592 23197 1930 11407 25273 1940 11862 23799 1950 14762 26265 1960 19698 32471 1970 22962 34782 1980 23979 35847 1990 23680 34500 2000 25174 36160 2010 26397 36691 2016 (est.) 26519 36757 Projected Population – The 2012 Comprehensive Plan for the COF projected the following population data for the COF in 2020 and 2030 (see Table 5-3). The population in 2040 was estimated using the data from the 2012 Comprehensive Plan. Table 5-3 Year City of Fremont 2020 27,466 2030 29,794 2040 (estimated) 32,319 Fremont Demographics The COF currently occupies approximately 8.80 square miles and according to the 2010 U.S. Census data, there are approximately 11,675 households in the City. Housing characteristics are: owner occupied - approximately 7,147 units and renter occupied - approximately 4,528 units 1. Home ownership represents 61.2% of all residential property. The COF electric service area includes the COF and the surrounding area. A map of the service area is attached in the appendix of this document. City Electric Customer Profile: Residential Customers: 12,457, Commercial Customers: 2,311, and Industrial Customers: 497 1 Housing statistics derived from 2017 Dodge County housing study at www.dodgecountyhousingstudy.com. 2018 Integrated Resource Plan Page 8  Customer Profiles Residential Commercial Industrial 3% 15% 82% 6: City of Fremont Distribution System COF operates its distribution system in a manner to provide the most dependable and lowest cost electricity to the customer. Distribution circuits are periodically evaluated to determine load levels and areas where circuits need to be upgraded and/or added to provide for more flexibility in shifting loads and for future growth. The COF evaluates transformers to ensure they are not overloaded and operating as efficiently as possible. New transformers are evaluated when purchased for not only cost, but also for losses over the expected life of the transformer. The COF has replaced essentially all electro-mechanical relays with newer microprocessor-based relaying on both the 13.8 kV and 69 kV systems. The new equipment has resulted in fewer widespread outages and better system reliability. The COF periodically reviews fuse coordination on the system to minimize customer outages, and reviews outage records to identify potential weaknesses in the distribution system and determine placement of additional fusing. The COF has recently completed a power factor study on the distribution system, which resulted in a plan to install additional capacitors on various distribution circuits. The addition of these capacitor banks will optimize the power efficiency of the distribution system. In addition, COF currently offers an incentive to encourage industrial users to improve their power factor. In 2017, a large industrial customer installed 4,350 kVAR of capacitors as part of an electric system improvement to their plant, which improved their peak month power factor from 83% to 96% or greater. This resulted in reduced kVAR demand, which can now be used to serve other loads. The COF has recently completed three (3) long-term projects to improve the safety and reliability of the system. Replacement of old and obsolete oil filled 69 kV substation breakers with new sulfur hexafluoride (SF6) gas breakers, replacement of old and obsolete 13.8 kV substation breakers with new outdoor vacuum breakers, and upgrade substations to current code requirements. A pilot project was completed to investigate the cost/benefits and energy efficiencies of changing the existing streetlights to light-emitting diode (LED) streetlights. The pilot project results showed a reduction in the cost and increased energy efficiencies. Therefore, going forward, the COF will be 2018 Integrated Resource Plan Page 9 installing LED street lights on all new installations, and replacing existing high-pressure sodium, mercury vapor, and metal halide fixtures as they fail with LED streetlights. Although the changeover will take several years to complete, analysis has shown that switching to LED streetlights will result in a streetlight demand reduction of approximately 372 kW and an energy consumption reduction of approximately 1,600,000 kilowatt-hours annually. The COF is currently building two new distribution circuits (approximately 3.5 miles) to serve a new large industrial customer. The new electrical load is estimated to be 12-14 MW, and is scheduled to come online in mid-2019. Weather can have an impact on the distribution system. In June of 2017, a thunderstorm moved through the COF service area with 115 mile-per-hour straight-line winds. The storm resulted in widespread damage to the distribution system, with outages to approximately 4,560 customers. COF crews, along with one neighboring mutual aid crew, restored service within two days to all customers who did not sustain damage to their electrical system and were able to utilize the power. The storm also destroyed 1.2 miles of 69kV transmission line, which was rebuilt and back in service in the spring of 2018. To further improve the COF distribution system, the COF issued a request for proposal for a Supervisory Control and Data Acquisition (SCADA) Control System to upgrade/replace the existing SCADA systems for all four City utilities (water, natural gas, electric and wastewater). This will result in a common master SCADA platform for all four (4) utilities. The project also includes replacement/upgrading of entire control systems including programmable logic controllers (PLC’s), remote terminal units (RTU’s), human machine interface’s (HMI’s), radios, network servers, etc. Monitoring of 18 lift stations and 40 gas pressure regulator/gas metering stations will be added to the upgraded system. The project is expected to result in increased reliability, enhanced monitoring and control capability, and reduced operation and maintenance costs for the City. In addition to the SCADA upgrade, the City has contracted with a local communications contractor to install a substantial expansion of the City’s fiber optic communication network. The expansion in an approximate 18-mile fiber optic ring that includes COF electric substations, distribution warehouse, power plants, water treatment plant, and waste water treatment plant. The fiber optic network ring will be used for high-speed SCADA network communication, control, and direct transfer trip relay communications. The fiber network, along with the SCADA upgrade, will provide increased reliability, security and accommodate additional future functionality, such as outage management systems, distribution management system, and advanced metering infrastructure applications. Due to capacity constraints on the two existing 69kV transmission ties with Omaha Public Power District (OPPD), the COF has contracted with OPPD to build a new 161kV/69kV transmission tie line into the COF. The line is scheduled to be completed by January 2019. In preparation for the new line, the COF has contracted for the design and construction of a major upgrade to Substation B. The upgrade will include a new control building housing all-new relaying and control panels. The new transmission tie will 2018 Integrated Resource Plan Page 10 have 1200-amp capacity and provide the COF with the ability to utilize additional outside “grid” resources. In 2016, COF began using the American Public Power Association (APPA) eReliability Tracker software to track customer outages. The software allows the COF to calculate reliability indices for the distribution system and provides top-level reliability-related benchmarking information. In March of 2018, the COF was recognized by APPA for achieving excellence in reliability for 2017 by significantly outperforming the electric industry national average as reported by the Energy Information Administration (EIA). In addition, the COF earned a 2017 Gold Level Designation RP3 award from APPA, recognizing the COF as a Reliable Power Provider. The award recognizes utilities that demonstrate high marks in reliability, safety, workforce development, and system improvement. In February of 2018, the COF commissioned a new 1.5 MW Community Solar Farm. COF’s customers participating in the community solar project purchase the energy from the solar farm. The solar farm’s output is connected directly to one of the COF’s 13.8 kV distribution circuits. The Community Solar Farm was so successful that the COF contracted for a second, 1.0 MW solar farm that is scheduled to be completed by September of 2018. In 2018, the COF received a Grant from the Nebraska Environmental Trust to purchase five (5) electric vehicles and install two (2) electric charging stations. The dual 240-volt Level 2 chargers were installed on the distribution system in public locations to encourage use of electric vehicles and provide convenient locations for electric vehicle (EV) owners to charge their vehicles. The COF will apply for additional grant funding in future years for additional EV’s and charging stations to promote environmentally friendly EV usage in the COF. In addition, the COF is considering implementing additional EV incentives to build off-peak load. The COF continues to use an infrared camera to monitor hot spots in substations and switchgears, motors, and electrical equipment. Regular monitoring helps to minimize unplanned outages and breakdowns. This monitoring also reduces energy losses caused by loose connections and failing equipment. The camera is shared with other City departments to help improve their operations. In 2015, the COF purchased a commercial pole testing equipment so that COF personnel could perform wood pole testing in lieu of hiring a private contractor. From 2015 through 2017, approximately 2,454 poles were tested. The number of failed or “bad” poles is approximately 4 to 5 percent. As bad poles are found, they are replaced with new poles by COF staff. COF staff estimates that 1,000 poles will be tested each year. The COF’s goal is to have all wood poles on the system tested on a 10 to 15 year cycle. COF staff performs annual transmission line inspections, based on the inspection repairs are prioritized and completed in a timely fashion. Every two years the distribution circuits, both underground and overhead are inspected and issues are repaired as appropriate. The COF also has its own tree-trimming crew. The crew trims trees to maintain clearance on the City’s electrical system in a four-year cycle. The COF has maintained very good reliability numbers by performing these tasks. 2018 Integrated Resource Plan Page 11  7: Environmental One of the biggest challenges in projecting and planning for future power generation is the ever-changing environmental and regulatory climate. There have been several new environmental regulations that have affected the LDW Power Plant, including the Mercury Air Toxics Standards Rule, Cross State Air Pollution Rule and Coal Combustion Residuals Rule. The sections below discuss several environmental regulations that affect the LDW Power Plant. Acid Rain Program: Title IV of the 1990 Amendments to the Clean Air Act required acid rain to be controlled, thus creating the Acid Rain Program. The Acid Rain Program requires the monitoring, recordkeeping and reporting of sulfur dioxide (SO2), nitrogen dioxides (NOx), carbon dioxide (CO2), volumetric flow and opacity under 40 CFR part 75. The LDW Unit 8 and Derril G. Marshall Generating Station are subject to the Acid Rain Program and is allocated allowances annually for each unit from the Environmental Protection Agency (EPA). The LDW Unit 8 has the ability to operate on coal and natural gas. The unit also utilizes natural gas or propane for igniters and flame stabilization. The Derril G. Marshall Generating Station is a dual fuel simple cycle combustion turbine that can operate on natural gas or number two fuel oil. Annual allowances are maintained in an account and annual SO2 and NOx emissions are subtracted from the annual allocated allowances. Any remaining unused allowances can be banked and used in future year’s emissions. Cross-State Air Pollution Rule (CSAPR): The Cross-State Air Pollution Rule (CSAPR), also known as the Transport Rule was finalized by the EPA on July 6, 2011. After court challenges, the rule became effective on January 1, 2015 to reduce SO2 and NOx emissions by setting an annual limit on tons of pollutant emitted through the use of allowances. The rule does allow affected sources to determine how they will meet compliance. Affected sources must have enough allowances in their account at the end of the compliance period to cover the emissions for that period. Participants in the CSAPR are allowed to buy, sell or bank allowances. The LDW Unit 8 and the Derril G. Marshall Generating Station are subject to the CSAPR and holds allowances to cover annual SO2 and NOx emissions. Mercury and Air Toxics Rule (MATS): The Mercury and Air Toxics Rule (MATS) final rule became effective on April 16, 2012, and created technology based standards to limit mercury, acid gases and other pollutants emitted by power plant electric generating units (EGUs) with a capacity of 25 megawatts or greater. The MATS rule required sources to comply with the rule no later than April 16, 2015. Sources could apply to their permitting authority for a 1-year extension allowed under Section 112 of the Clean Air Act. The LDW Unit 8 is subject to the MATS Rule and installed a Spray Dryer Absorber (SDA) to control acid gases, a fabric filter baghouse to control particulate matter (PM) and a powder activation carbon (PAC) injection system to control mercury to comply with the emission standards. 2018 Integrated Resource Plan Page 12 National Pollutant Discharge Elimination System (NPDES): The National Pollutant Discharge Elimination System (NPDES) permit program was created in 1972 by the Clean Water Act to address water pollution from point sources that discharge to waters of the United States. The LDW was issued their current NPDES permit from the Nebraska Department of Environmental (NDEQ) on July 3, 2017. The permit included a compliance schedule to meet the requirement of zero discharge of bottom ash transport water set forth in the 2015 revision of the Steam Electric Power Generating (ELG) category of 40 CFR Part 423. Due to pending litigation of the ELG Rule, the EPA has proposed a reconsideration of the rule that applies to bottom ash transport water at existing sources. Coal Combustion Residuals (CCR): The Coal Combustion Residuals (CCR) Rule was published in the Federal Register on April 17, 2015 and became effective on October 19, 2015. The CCR rule details requirements for the safe disposal of coal combustion residuals from coal-fired power plants into landfills and surface impoundments under Subtitle D of the Resource Conservation and Recovery Act (RCRA). Based on the CCR rule, the LDW power plant meets the definition as an existing landfill and complies with the rule. 8: Existing Electrical Supply It is the mission of the COF to provide safe, reliable, economical electricity to their customer owners at the lowest cost. In order to accomplish this it is imperative that the assets of the utilities be properly maintained and operated. The COF serves approximately 15,265 electric customers located in and around the COF. A map of the COF electric service area is included in the appendix. The COF operates the electrical system for the ratepayers. The system includes three (3) coal and natural gas fired boilers supplying steam to three (3) steam turbine generators located at the LDW Power Plant. One (1) dual fuel combustion turbine located at the DGM Power Plant. One (1) solar farm (SF1) on the City’s distribution system near the existing power plant. One (1) solar farm (SF2) currently under construction on the City’s distribution system located at the City’s Well Field. In addition, a Purchase Power Agreement (PPA) for wind energy with NextEra Energy Cottonwood Wind Project, LLC, near Blue Hill, Nebraska. A summary of the units below: Table 8-1 2018 Integrated Resource Plan Page 13  Unit In-Service Nameplate Rating Net Fuel Supply Year Rating MW MW LDW Unit 6 1956 16.5 15 Coal / Natural Gas LDW Unit 7 1962 21 20 Coal / Natural Gas LDW Unit 8 1976 91.5 82 Coal / Natural Gas Derril G. Marshall 2003 40 36 Natural Gas / #2 Diesel Generating Station Solar Farm 1 (SF1) 2018 1.3 Renewable Solar Solar Farm 2 (SF2) 2018 1.0 Future (10/1/2018) Cottonwood Wind 2018 40.89 Renewable Wind (PPA) Project LLC (Joint) City of Fremont Resources – Nameplate Ratings City of Fremont Power Plants: LDW - Derril G. Marshall Generating Station The LDW Power Plant and the Derril G. Marshall (DGM) Power Plant serve the City’s demand and are able to produce additional electrical energy to the grid. The primary fuel for the LDW Power Plant is coal from the Powder River Basin in Wyoming. The coal is low sulfur and approximately 8,800 Btu’s per pound. Coal is supplied by rail and the COF receives shipments from late March through November. The COF stockpiles coal to provide adequate fuel supply for the winter months. The chart below indicates the national average price for coal and natural gas since 2008, plus the estimated cost of delivery to Fremont. The COF purchases approximately 315,000 tons of coal per year and approximately 175,000 MMBtus of natural gas. These amounts change based on weather and the COF’s demand. 2018 Integrated Resource Plan Page 14  National Average Fuel Cost* $35 $30 $25 $20 Gas ($/MMBtu) $15 Coal ($/Tons) $10 $5 $0 2018 2009 2010 2011 2012 2013 2014 2015 2016 2017 *Gas cost: Rate includes both commodity and pipeline transportation cost average for that year traded on the NYMEX. *Coal cost: Rate includes the commodity and rail transportation cost average for that year according to the Argus Coal Weekly Pricing and Rail rate. LDW Power Plant has seen many improvements and repairs over the years. Most of the improvements have been required to meet new state and federal regulatory requirements, while repairs are required to maintain high reliability standards. The following are some of the plant improvements made. 1978-1979: LDW Unit 6 and LDW Unit 7 were equipped with baghouses and new induced draft fan (ID Fan) for capture of fly ash. 1979-1980: An ash conveying and storage system was installed for all three (3) LDW units. This replaced the ash sluicing system. 1995: A continuous emissions monitoring system was installed on LDW Unit 8 as part of the Clean Air Act to monitor SO2, NOX, CO2, Air Flow and Opacity. 2002 The installation of the reverse osmosis system and the water analysis equipment was installed to better monitor the boiler water and increase the efficiency of the existing demineralized water system. 2002 LDW Unit 8 cooling tower replacement. 2000-2003 Honeywell digital controls were installed to replace the original pneumatic controls on all three (3) LDW units. This installation provided improved boiler and turbine control and tuning, enhanced data collection and logging, and allowed the utilities to combine 2018 Integrated Resource Plan Page 15  multiple control rooms to better staff the facility and increase communication within operations and maintenance. 2001-2003 LDW Unit 6 and 7 generator excitation systems were obsolete and replaced with new systems. 2006 LDW Unit 6 and LDW Unit 7 condenser tube replacement. This project was done to ensure reliability due to unexpected tube leaks and to aid in the efficiency. 2014 LDW Unit 8 electrostatic precipitator was rebuilt due to age and condition of the original electrostatic precipitator. The electrostatic precipitator’s function is to capture fly ash from LDW Unit 8. 2014 LDW Unit 8 cooling tower fill was replaced, this allows for increased efficiency and reliability. 2015 LDW Unit 8 boiler was stiffened to protect the boiler due to the installation of the new induced draft fan. 2015 An Air Quality Control System (AQCS) was installed on LDW Unit 8. The AQCS consists of a dry scrubber, carbon injection, baghouse, ash system, and associated equipment. 2015 LDW Unit 8 Generator field rewind. 2015 LDW Unit 8 generator and turbine inspections were conducted based on hours of operation. The inspections provide an opportunity to inspect, clean and repair all internal components to allow for safe, reliable and efficient operation of the unit. 2017 LDW Unit 8 excitation system replaced due to the obsolescence of the prior system. The new system provides for reliable generator control and protection. Ongoing Units 6, 7 and 8 turbines and generators are inspected on a periodic basis (approximately 40,000 hours of operation). Plant staff evaluates methods and practices to increase plant efficiency. When the units are in an outage, equipment is inspected, cleaned, and calibrated to provide efficient and reliable service. The LDW Power Plant has established a program to replace the original lighting with energy efficient LED lighting. Below is a brief description of each of the energy sources that serve City customers: LDW Unit 6 The construction of the LDW Power Plant began in 1955 with the construction of LDW Unit 6, a 16.5 MW General Electric steam turbine powered by a Babcock and Wilcox coal and natural gas fired boiler. LDW Unit 6 boiler operates at ~ 925° F @ 880 PSI. LDW Unit 6 is primarily a standby unit operated when LDW Unit 8 is offline or during high demand seasons. LDW Unit 6 has seen many modifications including the addition of a baghouse and new induced 2018 Integrated Resource Plan Page 16 draft fan, removal of original pneumatic controls and replaced with state of the art digital controls. LDW Unit 6 utilizes a non-reheat turbine and once through condenser. LDW Unit 6 Turbine / Generator inspection is performed based on hours of operation. The boiler is inspected twice per year depending on operation of the unit. A boiler life study was conducted and the results of the study determined that the boiler and associated equipment are suitable for service. LDW Unit 7 LDW Unit 7, commissioned in 1962, is a 21 MW General Electric Steam Turbine powered by an Erie City coal and natural gas boiler. LDW Unit 7 boiler operates at ~925° F @ 880 PSI. LDW Unit 7, is primarily a standby unit operated when LDW Unit 8 is offline or during high demand seasons. LDW Unit 7 has seen many modifications including the addition of a baghouse and new induced draft fan, removal of original pneumatic controls and replaced with state of the art digital controls. LDW Unit 7 utilizes a non-reheat turbine and once through condenser. LDW Unit 7 Turbine / Generator inspection is performed based on hours of operation. The boiler is inspected twice per year depending on operation of the unit. A boiler life study was conducted and the results of the study determined that the boiler and associated equipment are suitable for service. LDW Unit 8 LDW Unit 8, commissioned in 1976, is a 91.5 MW General Electric steam turbine generator powered by a Babcock and Wilcox coal and natural gas fired boiler. LDW Unit 8 operates as a load following generator, it is the primary unit utilized to serve the City’s customers. The fuel supply for LDW Unit 8 is primarily low sulfur nominal 8,800 btu Powder River Basin (PRB) coal. LDW Unit 8 also has the ability to burn natural gas, however seasonal gas supply to the plant is insufficient to provide the quantity of natural gas to achieve full output. When natural gas is utilized, it is during start-up or co-fired with coal. LDW Unit 8 utilizes natural gas and, in an emergency propane, for start-up fuel and flame stabilization. LDW Unit 8 utilizes a reheat turbine boiler and a cooling tower for condenser cooling. LDW Unit 8 Turbine / Generator inspection is performed based on hours of operation. The boiler is inspected twice per year depending on operation of the unit. Derril G. Marshall Generating Station The Derril G. Marshal Generating Station was installed and commissioned in 2003. The unit is a dual fuel (natural gas / liquid fuel) nominal 40 MW simple cycle General Electric Frame 6B combustion turbine. It is a standby unit used for reliability concerns and during peak demand. The natural gas supply for the unit comes from the City’s natural gas system at 120 PSI to the inlet of a natural gas compressor that raises the pressure to the required 310 PSI. 2018 Integrated Resource Plan Page 17 Cottonwood Wind Project, LLC In 2017, the COF entered into a power purchase agreement with NextEra for the purchase of nominal 41 MW of wind energy from the Cottonwood Wind Project, LLC. This is a joint project with the COF as one of the participants. The total Cottonwood Wind Project is approximately 89 MW. On December 1, 2017, NextEra completed commissioning and turned the City’s share of the wind farm over to the COF. On February 1, 2018, all documentation was completed and the City’s portion of the wind farm was registered with the Southwest Power Pool (SPP) as a COF generation asset. COF Community Solar Farm 1 and 2 The COF conducted multiple community outreach meetings to gauge the interest in a community solar farm. The response was overwhelmingly positive, prompting the COF to solicit proposals for a solar farm located on an 11-acre site adjacent to the LDW Power Plant. The solar farm was initially going to be approximately one (1) MW, however due to the large volume of customers wanting to participate, the solar farm was enlarged to approximately 1.3 MW. On March 27, 2018, the City Council approved the purchase of Community Solar Farm #2 to be located at the COF’s Well Field. The proposal for Solar Farm #2 is approximately one (1) MW. Western Area Power Administration (WAPA) The COF has a long-term firm energy and capacity agreement with Western Area Power Authority (WAPA). Table 8-2 below summarizes the energy received from WAPA on an annual basis. Table 8-2 Month Energy ( MWH) Capacity (kW) January 2,443 4,285 February 2,249 4,345 March 2,358 3,975 April 2,138 4,049 May 1,684 3,931 June 1,855 4,090 July 2,184 4,369 August 2,453 4,792 September 1,969 4,297 October 1,746 3,104 November 2,465 4,433 December 2,706 4,790 2018 Integrated Resource Plan Page 18  9: Fremont Electrical Load and Forecasted Growth The COF electric system presently serves approximately 15,265 customers. The COF has a total net generation capacity of 153 Megawatts illustrated in Table 9-1 below. The COF receives a maximum of 4.7 Megawatts per hour from the Western Area Power Administration (WAPA). Table 9-1 Unit Net Winter MW Rating Net Summer MW Rating (Capacity) (Capacity) LDW Unit 6 15 MW 15 MW LDW Unit 7 20 MW 20 MW LDW Unit 8 82 MW 82 MW DGM 0 MW 36 MW WAPA 3 MW 3 MW Capacity Reserve 13% 16 MW 20 MW Total Installed Capacity 120 MW 156 MW Total Installed Capacity – 104 MW 136 MW Reserve The COF operates the fleet of electric generating units to provide reliable, safe and cost effective electric energy to it ratepayers. LDW Unit 8 provides the majority of energy to supply the COF electric demand. Table 9-2 below illustrates the City’s demand and the energy produced from each resource for calendar years from 2012 through 2017. During unit outages and when energy prices are low, the COF purchases energy to serve ratepayers. In Table 9-2, the off system sales are a result of the net effect of purchases and sales. Table 9-2 Fremont LDW Unit LDW Unit LDW Unit Derril G. Off System Year Demand 8 7 6 Marshal WAPA Sales 2012 442,532.60 353,836.90 54,511.21 44,176.58 1,801.51 26,285.20 38,078.80 2013 437,914.07 341,597.65 80,914.23 59,920.49 7.54 26,218.80 70,744.64 2014 438,011.10 333,782.92 85,250.93 55,452.23 57.78 26,289.50 62,822.26 2015 435,002.80 306,728.04 81,542.68 43,860.50 5,745.58 26,243.90 29,117.90 2016 439,676.51 301,064.91 90,861.97 55,178.61 10,668.62 26,304.00 44,401.60 2017 432,645.96 351,918.53 66,301.22 36,070.77 499.24 26,249.50 48,393.30 2018 Integrated Resource Plan Page 19 The charts below illustrate the historical winter and summer peak demand for the COF from 1980 to 2017. The data assumes a 1% growth to the system from 2018 to 2038, based on historic growth of 1% from 1980 to present. The charts also include the additional industrial load that will be starting in 2019 and completed in 2020. This industrial load is assumed to be two (2) MW in 2019 and twelve (12) MW in 2020. The data for these charts is included in the appendix at the end of this report. As displayed below, the City’s current resources are sufficient to meet Fremont’s energy demands in both the winter and summer seasons. Winter Historic and Projected Capacity 180.00 160.00 140.00 120.00 100.00 80.00 60.00 40.00 20.00 0.00 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 2025 2028 2031 2034 2037 Net System Demand SPP Reserve Winter Installed Capacity Summer Historic and Projected Capacity 180.00 160.00 140.00 120.00 100.00 80.00 60.00 40.00 20.00 0.00 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 2025 2028 2031 2034 2037 Net System Demand SPP Reserve Summer Installed Capacity 2018 Integrated Resource Plan Page 20 The charts below illustrate various load growth scenarios for winter and summer peak demands. Chart 1 illustrates the COF’s historic summer peak demand and growth increases of 1%, 1.5%, 2% and 2.5%. Chart 1 180 160 140 120 1.00% 100 1.50% 80 2.00% 60 2.50% 40 20 0 Chart 2 illustrates the COF’s historic winter peak demand and growth increases of 1%, 1.5%, 2% and 2.5%. Chart 2 180 160 140 120 100 1.00% 1.50% 80 2.00% 60 2.50% 40 20 0 2018 Integrated Resource Plan Page 21 Chart 3 utilizes historic summer demand data, the assumed 1% growth, 12 MW of new industrial load in 2020, and growth increases of 1%, 1.5%, 2% and 2.5%. Chart 3 180 160 140 120 1.00% 100 1.50% 80 60 2.00% 40 2.50% 20 0 Chart 4 utilizes historic winter demand data, the assumed 1% growth, 12 MW of new industrial load in 2020, and growth increases of 1%, 1.5%, 2% and 2.5%. Chart 4 180 160 140 120 1.00% 100 1.50% 80 2.00% 60 2.50% 40 20 0 2018 Integrated Resource Plan Page 22 Chart 5 shows summer peak demand of 1% growth, 12 MW of new industrial load in 2020, and growth increases of 1%, 1.5%, 2% and 2.5%. Chart 5 180 160 140 120 100 80 1.00% 60 40 20 0 Chart 6 shows winter peak demand of 1% growth, 12 MW of new industrial load in 2020, and growth increases of 1%, 1.5%, 2% and 2.5%. Chart 6 180 160 140 120 100 80 1.00% 60 40 20 0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2018 Integrated Resource Plan Page 23  Chart 7 shows projected summer peak demands with and without the 12 MW of new industrial load in 2020. Chart 7 180 160 140 120 1.00% 100 1.50% 80 2.00% 60 2.50% 40 1.00% 20 0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 Chart 8 shows projected winter peak demands with and without the 12 MW of new industrial load in 2020. Chart 8 180 160 140 120 1.00% 100 1.50% 80 2.00% 60 2.50% 40 1.00% 20 0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2018 Integrated Resource Plan Page 24 10: Conservation and Demand Side Management Nebraska consistently ranks in the top 10 of the lowest electric energy prices in the United States. Electric energy prices in the COF are equally low making it difficult to justify a demand side program. The COF has seen a reduction in electric demand from ten (10) years ago. This reduction has been attributed to increased efficiencies in residential, commercial and industrial loads. An example is the COF’s efforts in changing out the streetlights in the City with LED lights to significantly reduce consumption. The COF will continue to monitor the COF’s demand and the available generation, and if necessary and economically feasible, the COF may adopt some form of Demand Side Management or energy conservation program. The COF is in the process of establishing an electric vehicle incentive program and has been working with multiple organizations to encourage the purchase of electric vehicles. The COF is also installing charging stations for public use. The charging stations will collect data to indicate usage patterns that can be used to promote electric vehicles in the future. 11: Excess Energy The COF participates in the Southwest Power Pool (SPP) market (map below). The COF schedules estimated demand and generation resources on a daily basis. As shown on Table 9-2, the COF has generation available for “off system sales” and makes that energy available into the SPP market when it makes economic sense. As COF’s load increases or there are unforeseen regulatory constraints, the amount of energy that the COF has available to place into the SPP market may be reduced. The COF monitors pricing and demand to determine which units that are placed into service. There are periods of the year and or conditions that warrant multiple unit operation due to reliability constraints. The COF manages the operation and loading of those units to provide a reliable source of energy, while being cognizant of the pricing per unit. 2018 Integrated Resource Plan Page 25  12: Summary: • The COF will review that electric demand of the City and compare it against the forecasted demands in this report. • The COF will monitor the regulatory agencies for impact to the existing fleet of generation sources. • The COF will provide outreach to stakeholders in the City. This will provide the COF the opportunity to gauge the ratepayer’s energy trends. This also provides the COF the opportunity for ratepayer input on existing and new generation sources. • As illustrated in this report, the City’s expected growth in demand, including the new industrial load, should not exceed available generation. • The COF will monitor customer preferences in electric supply and resource mixes. 2018 Integrated Resource Plan Page 26  Appendix City of Fremont service area map COF net summer and winter peak demand historic from 1980 through 2017, and estimated from 2018 to 2038, as indicated by the yellow text. Net Summer System Peak Demand Net Winter System Peak Demand Year Net System Demand Year Net System Demand 1980 72.60 1980 45.90 1981 71.00 1981 47.50 1982 64.70 1982 48.50 1983 66.90 1983 39.90 1984 65.32 1984 45.10 1985 59.48 1985 44.90 1986 65.23 1986 45.38 1987 69.60 1987 42.26 1988 73.45 1988 46.31 2018 Integrated Resource Plan Page 27  1989 69.94 1989 49.03 1990 72.69 1990 51.08 1991 71.15 1991 50.44 1992 61.92 1992 47.77 1993 72.88 1993 48.53 1994 73.86 1994 52.98 1995 84.22 1995 54.17 1996 85.97 1996 57.00 1997 83.39 1997 59.54 1998 87.44 1998 55.90 1999 91.44 1999 58.30 2000 84.90 2000 60.57 2001 87.23 2001 62.58 2002 85.68 2002 58.77 2003 89.54 2003 63.15 2004 89.55 2004 63.78 2005 91.49 2005 66.82 2006 96.52 2006 66.72 2007 90.91 2007 70.30 2008 87.34 2008 72.28 2009 86.93 2009 72.12 2010 92.49 2010 71.00 2011 94.58 2011 72.26 2012 96.77 2012 67.90 2013 90.31 2013 70.66 2014 89.99 2014 75.71 2015 88.76 2015 71.96 2016 93.87 2016 68.11 2017 94.91 2017 70.08 2018 95.86 2018 70.46 2019 98.82 2019 73.16 2020 109.81 2020 83.90 2021 110.90 2021 84.73 2022 112.01 2022 85.58 2023 113.13 2023 86.44 2024 114.26 2024 87.30 2025 115.41 2025 88.17 2026 116.56 2026 89.06 2027 117.73 2027 89.95 2028 118.90 2028 90.85 2029 120.09 2029 91.76 2018 Integrated Resource Plan Page 28  2030 121.29 2030 92.67 2031 122.51 2031 93.60 2032 123.73 2032 94.54 2033 124.97 2033 95.48 2034 126.22 2034 96.44 2035 127.48 2035 97.40 2036 128.76 2036 98.37 2037 130.04 2037 99.36 2038 131.34 2038 100.35 2018 Integrated Resource Plan Page 29  8/9/2018 City of Fremont 2018 Integrated Resource Plan 2018 Integrated Resource Plan Section 1 Introduction 2 Public Works Oversight 3 Community Outreach 4 History 5 Community and Customer Profiles 6 Electrical Distribution System 7 Environmental 8 Existing Supply 9 Fremont Electrical Load and Forecasted Growth 10 Conservation and Demand Side Management 11 Excess Energy 12 Summary 1  8/9/2018 Section 1: Introduction  Electric Production rapidly changing  Environmental  Regulator (SPP)  Customer Preference  COF Generation Asset Shift  Coal / Natural Gas  Wind Energy 2017  Solar Energy 2018 Section 2: Utility Oversight  Utilities and Infrastructure Board (UIB)  Five member board  Appointed by Mayor and approved by City Council  Meetings second and last Tuesday of every month at 4:00 PM  City Council  Elected Mayor  Four council districts with two councilpersons per ward  Meetings second and last Tuesday of every month at 7:00 PM 2  8/9/2018 Section 3: Community Outreach  Newsletters  Fremont Facebook Page  Fremont website (www.fremontne.gov)  Home show / town hall meeting / JC Fremont Days  Local schools programs / tours / mock interviews  UIB and City Council meetings are open to the public Section 4: History  Original Power Plant 8th and Park  LDW Power Plant  LDW Unit 6  LDW Unit 7  LDW Unit 8  DGM Combustion Turbine  Cottonwood Wind Project PPA  Community Solar Farm 1 and 2 3  8/9/2018 Section 5: Community and Customer Profiles Customer Profile Residential Commercial Industrial 3% 15% 82% Section 6: City of Fremont Distribution System  Ongoing testing  Updated protective relays  Power Factor correction – Utility and Customers  Circuit Breaker Replacement  LED Street Lighting  Large Customer infrastructure additions  SCADA implementation  Transmission Line and Substation installation 4  8/9/2018 Section 7: Environmental  Acid Rain Program  Cross-State Air Pollution Rule (CSAPR)  Mercury and Air Toxics Rule (MATS)  National Pollutant Discharge Elimination System (NPDES)  Coal Combustion Residuals (CCR) Section 8: Existing Electrical Supply Unit In-Service Nameplate Rating Fuel Supply Year Rating MW Net MW LDW Unit 6 1956 16.5 15 Coal / Natural Gas LDW Unit 7 1962 21 20 Coal / Natural Gas LDW Unit 8 1976 91.5 82 Coal / Natural Gas Derril G. Marshall 2003 40 36 Natural Gas / #2 Diesel Generating Station Solar Farm 1 (SF1) 2018 1.3 Renewable Solar Solar Fram (SF2) 2018 1.0 Future (10/1/2018) Cottonwood Wind 2018 40.89 Renewable Wind (PPA) Project (Joint) 5  8/9/2018 Section 9: Fremont Electrical Load and Forecasted Growth Unit Net Winter MW Rating Net Summer MW Rating Fremont Off System Year (Capacity) (Capacity) Demand U8 U7 U6 50T WAPA Sales LDW Unit 6 15 MW 15 MW 2012 442,532.60 353,836.90 54,511.21 44,176.58 1,801.51 26,285.20 38,078.80 LDW Unit 7 20 MW 20 MW LDW Unit 8 82 MW 82 MW 2013 437,914.07 341,597.65 80,914.23 59,920.49 7.54 26,218.80 70,744.64 Derril G. Marshall Assumption 2 36 MW WAPA 3 MW 3 MW 2014 438,011.10 333,782.92 85,250.93 55,452.23 57.78 26,289.50 62,822.26 Capacity Reserve 13% 16 MW 20 MW Total Installed Capacity 120 MW 156 MW 2015 435,002.80 306,728.04 81,542.68 43,860.50 5,745.58 26,243.90 29,117.90 Total Installed Capacity – 104 MW 136 MW 2016 439,676.51 301,064.91 90,861.97 55,178.61 10,668.62 26,304.00 44,401.60 Reserve 2017 432,645.96 351,918.53 66,301.22 36,070.77 499.24 26,249.50 48,393.30 Historic and Projected Capacity Winter Historic and Projected Summer Historic and Projected Capacity Capacity 180.00 180.00 160.00 160.00 140.00 140.00 120.00 120.00 100.00 100.00 80.00 80.00 60.00 60.00 40.00 40.00 20.00 20.00 0.00 1980 0.00 1980 1983 1986 1989 1992 1995 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 1998 2001 2004 2007 2010 2013 2016 2019 2022 2025 2013 2016 2019 2022 2025 2028 2031 2034 2037 2028 2031 2034 2037 Net System Demand SPP Reserve Net System Demand SPP Reserve Winter Installed Capacity Summer Installed Capacity 6  8/9/2018 Section 10: Conservation and Demand Side Management  Fremont rates among lowest electric rates in the state  LED street lights  Customer power factor correction incentive  COF system power factor correction  Fremont will monitor demand and if feasible implement DSM  EV incentive program for off peak charging Section 11: Excess Energy  When pricing makes economic sense Fremont puts excess energy into the SPP market  As Fremont demand increases the amount of energy available for off system sales will be reduced.  Units are dispatched based on reliability and economic conditions. 7  8/9/2018 Section 12: Summary  The COF will review that electric demand of the City and compare it against the forecasted demands in this report.  The COF will monitor the regulatory agencies for impact to the existing fleet of generation sources.  The COF will provide outreach to stakeholders in the City. This will provide the COF the opportunity to gauge the ratepayer’s energy trends. This also provides the COF the opportunity for ratepayer input on existing and new generation sources.  As illustrated in this report, the City’s expected growth in demand, including the new industrial load, should not exceed available generation.  The COF will monitor customer preferences in electric supply and resource mixes. Comment Period and Contact Information  Comments must be submitted by August 22, 2018 at 2:00 PM  Submit comments to the Integrated Resource Plan to:  Jeff Shanahan, Power Plant Superintendent  Jeff.Shanahan@fremontne.gov 8