CPS Energy Launches Community Dialogue About Its Flexible Path Resource Plan, Including A Focus On Coal

Author: CPS Energy / 2023-07-27 11:15 / Source: CPS Energy

CPS Energy Launches Community Dialogue About Its Flexible Path Resource Plan, Including A Focus On Coal

SAN ANTONIO,Feb. 9,2021 -- CPS Energy,the largest municipally owned electric and natural gas company in the United States,is launching a community-wide dialogue about future paths it could pursue to power San Antonio,Texas,the nation's 7th largest city.

CPS Energy Launches Community Dialogue About Its Flexible Path Resource Plan, Including A Focus On Coal

In 2021,the utility will launch a community-wide dialogue by publicly releasing its Flexible PathSM Resource Plan,whichis now accessible on their website. The Flexible Path Resource Plan directly addresses theretirement of several aging gas steam units that will reach their end of life during this decade.

Aligned with the company's broad Flexible Pathstrategy,CPS Energy developed the new and innovative FlexPOWER BundleSMRequest for Proposal (RFP). This important global RFP was issued in 10 languages in late 2020. The RFP submission process closed on February 1,2021. The company started its evaluation process and hopes to begin announcing selected projects by early spring or late summer.

The FlexPOWER Bundlewill help CPS Energy vet the most effective energy solutions to replace its previously mentioned older gas steam units that will reach their end of life (approximately 55 years) before 2030. The following shows the components of the bundle:

Up to 900 MW of solar resources that will support the EnvironmentalResponsibility Pillar.

Up to 50 MW of energy storage that will support the Resilience and Environmental ResponsibilityPillars.

Up to 500 MW of all-source firming capacity,defined as any technologies that can be called upon when renewables are not available,supporting the Pillar of Reliability.

NOTE: A Megawatt (MW) is the unit representation for power. For example,1 MW of solar can power 200 homes on an average summer day.

In 2018,CPS Energyshut down two older coal units,J. T. Deely 1 and 2,15 years earlier than planned. The company thoughtfully replaced that power generating capacity through the purchase of a newer natural gas plant. The new Flexible Path Resource Planalso includes a view of possible alternative options for their two remaining and newer coal units,Spruce1 and2.

To expand customer engagement,CPS Energy is opening the topic about coal up to its community. Part of that conversation will involve further explaining how the company aspires to come up with a balanced,thoughtful,and effective pathway forward. To facilitate the discussions,CPSEnergy will explain how it uses its balanced Guiding Pillars & Foundation,as shown below,to vet all major strategies and initiatives,including the Flexible Path,as well as any specific incremental power generating solutions.

The primary objective of this community-wide dialogue is to broadly engage customers while soliciting their questions,insights,and feedback. Included in this process will be a series of virtual town halls and meetings where customers will hear from leaders and have opportunities to ask questions and seek collaboration. Information about how to participate will be shared this month.

As a basis of the upcoming conversations,the Flexible Path Resource Plan's available reference materials will include key assumptions and scenarios,including estimated residential customer bill impacts and company financial metric projections. Importantly,the document also addresses potential impact to their workforce. Relative to the new Resource Plan's look at potential options for its two remaining coal units,two distinct scenarios have been developed.

BASE CASE:

• Spruce 1 – Replace with an Additional FlexPOWER BundleSM offering in 2029

• Spruce 2 – Continue to Operate as a Coal Plant

REPLACE SPRUCE 1 & 2 COAL UNITS:

• With Renewables & Batteries

REPLACE & CONVERT:

• Spruce 1 – Replace with an Additional FlexPOWER BundleSM

• Spruce 2 – Convert to Natural Gas

"When I took the helm of CPS Energy in 2015,I asked our employees to embrace a People Firstapproach,through which we look at our customers as our beacon and inspiration to provide excellent service and we continue to take caring actions to support our entire community. I am proud to say that our employees anchor to these beliefs every day,as they diligently serve Greater San Antonio. Our team looks forward to a robust dialogue with all our customers about our new Flexible Path Resource Plan," said Paula Gold-Williams,President & CEO of CPS Energy. "Extensive,broad,open,constructive,respectful,and frequent conversations,based upon facts,figures,and finance are the best way for San Antonio to determine how to move prudently to a decarbonized future by,and perhaps before,2050."

It is important to clarify that no specific decision has yet been made to close either remaining coal unit early. Such an assumption is only factored in the current modeling assessments to support the upcoming community-wide discussions.

Along with the Flexible Path Resource Plan document and supporting attachments,also included is an Executive Summary and Overview written by the President & CEO to provide helpful context. That broad document provides highlights and takeaways from the Resource Plan and can be accessed here.

While the utility focuses on actively engaging through this dialogue,it is important to note that the CPS Energy Board of Trustees must approve all major power generation decisions. At the appropriate time,after extensive and frequent conversations with our community and thoughtfully considering their suggestions,the Board will authorize management to proceed with a viable set of Resource Plan solutions.

Continue to check the CPS Energy website,www.cpsenergy.com,for other informational materials such as our latest Sustainability Report,Annual Reports,and helpful customer programs.

About CPS Energy

Established in 1860,CPS Energy is the nation's largest public power,natural gas,and electric company,providing safe,reliable,and competitively-priced service to 860,934 electric and 358,495 natural gas customers in San Antonio and portions of seven adjoining counties. Our customers' combined energy bills rank among the lowest of the nation's 20 largest cities – while generating $8 billion in revenue for the City of San Antonio for more than seven decades. As a trusted and strong community partner,we continuously focus on job creation,economic development,and educational investment. True to our People First philosophy,we are powered by our skilled workforce,whose commitment to the community is demonstrated through our employees' volunteerism in giving back to our city and programs aimed at bringing value to our customers. CPS Energy is among the top public power wind energy buyers in the nation and number one in Texas for solar generation.

CPS Energy Launches Community Dialogue About Its Flexible Path Resource Plan, Including A Focus On Coal