ML21225A719

Transcript for W18

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Issue date:	03/10/2021
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Official Transcript of Proceedings NUCLEAR REGULATORY COMMISSION

Title:

33rd Regulatory Information Conference Technical Session - W18 Docket Number:

(n/a)

Location:

teleconference Date:

Wednesday, March 10, 2021 Work Order No.:

NRC-1420 Pages 1-63 NEAL R. GROSS AND CO., INC.

Court Reporters and Transcribers 1323 Rhode Island Avenue, N.W.

Washington, D.C. 20005 (202) 234-4433

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION

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33RD REGULATORY INFORMATION CONFERENCE (RIC)

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TECHNICAL SESSION - W18 THE EVOLUTION OF THE U.S. ELECTRIC GRID:

IMPLICATIONS FOR NUCLEAR TECHNOLOGY

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WEDNESDAY, MARCH 10, 2021

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The RIC session convened via Video Teleconference, at 1:30 p.m. EST, David Wright, NRC Commissioner, presiding.

PRESENT:

DAVID WRIGHT, NRC Commissioner JETTE GEBHART, Director, Office of Energy Market Regulation, Federal Energy Regulatory Commission ARSHAD

MANSOOR, President and Chief Executive Officer, Electric Power Research Institute KEVIN LYNN, Director of Grid Modernization, U.S.

Department of Energy DEWEY SAMUEL ROBERTS, General Manager, Transmission

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Planning and Operations Strategy, Duke Energy CONTENTS Page Introductory Remarks...............................3 Introduction to the Electric Grid and FERC.........6 Accelerating Economy Wide Decarbonization.........16 Grid Modernization Initiative Overview............23 The Key Role of Nuclear Power in the Clean Energy Transition..................................34 Question and Answer Session.......................43 Closing Remarks...................................63

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 P R O C E E D I N G S 1:30 p.m.

COMMISSIONER WRIGHT: Good afternoon, everyone, and welcome to the RIC and welcome to Technical Session W18, "The Evolution of the U.S.

Electric Grid, Implications for Nuclear Technology."

Before we get started, I wanted to take a moment to thank our session coordinator, Candace de Messieres, and my chief of staff, Cathy Kanatas, and my administrative assistant, Kim Lora, for their guidance and support. And to my four incredible panelists today, as well as the RIC organizers, contractors, the NRC staff for their efforts in putting on not just a great panel but a great RIC.

And I'd like to begin by providing a little context on today's panel topic. Electricity generation sources, energy storage capability, and the operation of the transmission and distribution systems are evolving in response to many factors such as changing energy use demands and patterns, focus on sustainability and decarbonization initiatives, technology innovations, and enhanced security.

For

example, decarbonization and greening of the grid initiatives have spurred an

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 interest in increased renewable electricity sources as well as highlighted a role for existing and new and advanced nuclear technologies.

These changes underscore the importance of a smarter grid with increased resiliency. This session will explore how the evolution of the U.S.

electric grid is affecting nuclear energy today and in the future. A discussion on grid evolution and its impact is timely given the recent events in Texas as a result of the extended cold weather conditions last month.

So, to help us learn more on this important topic and a very timely topic, we brought together experts working in various roles from grid regulation and operations to grid thought leadership and modernization initiatives.

Our four panelists today are Ms. Jette Gebhart with the Federal Energy Regulatory Commission, or FERC; Dr. Arshad Mansoor of the Electric Power Research Institute, better known as EPRI; Mr. Kevin Lynn from the United States Department of Energy; and finally, Mr. Sammy Roberts from Duke Energy.

So before I more formally introduce our

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 first two speakers, I would like to get this panel started with a live polling question just to kind of integrate all of you.

So here is the question. What is the biggest challenge to a modern grid in the 21st Century? On the screen, you will see a list of possible responses so go ahead and lock in your answer.

The poll results are going to be displayed on one side the screen. And I would appreciate any comments from our first two presenters on how these challenges can be overcome in the modern grid. Your responses are not going to count against your presentation time either, so don't worry.

Our first speaker today is Ms. Jette Gebhart, as I said, Director of the Office of Energy Market Regulation at FERC. Among its several critical

roles, FERC regulates the interstate transmission of electricity, natural gas, and oil.

And, you know, personally I'm thrilled to welcome a fellow independent regulatory partner to introduce us to the U.S. electric grid and FERC's role.

And following Ms. Gebhart will be Dr.

Arshad Mansoor, President and Chief Executive Officer

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 at EPRI. EPRI provides thought leadership, industry expertise and collaborative value to help the electricity sector identify issues, technology gaps and broader needs that can be addressed through effective research and development programs for the benefit of society. And we look forward to Arshad's insights on the role of nuclear energy in economy-wide decarbonization.

So let's begin. Ms. Gebhart, the floor is yours.

MS. GEBHART: Thank you so much. I'm really happy to be here. I really appreciate the opportunity to speak at this very impressive conference and thank you for the invitation and for the introduction, and all the great organizers.

As the Commissioner noted, I will be giving a brief introduction to the electric grid and FERC at a very basic level to set the stage for the rest of the discussions.

Before I get started, I will note that these remarks and any views expressed are my own and not those of the FERC chairman or commissioners.

All right. So I am not actually seeing the slides right now. So I'm going to do my best as

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 I move through with knowing my slides and cuing. But please let me know if you have any issues.

So my first slide is an overview of the electric grid. And I'll talk about that and the transactions over that grid. There we go. I see my slide now.

So what we informally referred to as the grid is actually a massive machine that consists of three main functions: generation, transmission, and distribution.

Electric generation creates electricity, what we call supply using various generating technologies. You see that on the left side of the screen.

The transmission system transfers large amounts of power from generators over what are usually high voltage facilities. You see that in the middle of the screen. Transmission lines deliver power to the distribution system, which is usually comprised of lower voltage facilities and the distribution system routes that electricity to consumers. The demand for electricity is often referred to as load.

So the transactions that take place over

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 this machine are also divided up, this time between wholesale and retail. So wholesales are sales of electricity for resale, usually from a generator to a load serving entity or marketing entity, or sometime either by contract or through an essentially operated market.

Retail sales are sales of electricity to consumers, usually from a utility, like Dominion where I am, in Virginia, to residential, commercial, or industrial customers.

All right. So next slide, please. But the grid is not a national monolith, rather it's divided into three parts in North America called interconnections. The interconnections have only limited connections to each other. So you see how it's divided up there on the slide.

The eastern interconnection includes the eastern two-thirds of the United States and eastern parts of Canada. The western interconnection includes the western third of the continental United States, excluding Alaska, western parts of Canada, and a portion of northern Mexico.

The Electric Reliability Council of Texas interconnection comprises most of the State of Texas.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 And so, as we've heard a lot recently, its roots are in some ways a separate grid.

Within each interconnection, electricity is consumed the instant it is produced. So each interconnection itself is constantly in balance.

All right. Next slide. So how are the grid and the related transactions regulated? What is the role of FERC? The responsibility for regulation on energy transactions, and here I'm focused on electricity although, as Commissioner Wright noted, FERC has responsibility over some natural gas and oil transportation rates as well.

But responsibility for regulation is divided between the federal government and the states.

With respect to rate regulation, that is how much can we charge for electricity, transmission and related services, FERC is responsible for regulating the rates with the transmission of electric energy and wholesale commerce, interstate commerce, excuse me, so the middle portion of that first slide, and the sale of such energy at wholesale, also an interstate commerce. So we're talking about commerce across state lines.

FERC also has authority over practices

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 affecting those rates. The states, on the other hand, are responsible for rates for retail sales of electricity, the sales to consumers, and rates for use of the distribution system. So, the right-hand part of that first slide.

States also have the authority over what generation gets built, including the choice, siting and construction of generation. There are some interactions, of course, between what states choose and the wholesale markets because that generation --

it makes sales in the wholesale markets, but it is ultimately the state's authority to determine what generation it is built.

With respect to Texas, as we saw in the previous slide with the interconnections, the ERCOT grid is largely functionally separated from the other states. So the rates for sale and transmission of electric energy in ERCOT are regulated by the State of Texas, not FERC.

Reliability and marketing manipulation authority are somewhat different. And I'll touch on those later.

Next slide. So very briefly, no --

sorry, next slide, which I think is Slide 5. Great.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 While we're talking about what FERC does, I'm going to put a short plug in for what FERC is. Again, FERC is an independent agency of five commissioners, or up to five commissioners, with no more than three being from one political party at any time.

The work of the Commission is divided up among 13 program offices, one of which is mine, Energy Market Regulation. There are also offices that govern reliability and that oversee enforcement. So those are some of the areas we'll be talking about later.

Next slide. So who are the entities that participate in transactions over this grid? So who are the regulated entities?

The wholesale electric industry is made up of a variety of sectors, all different types of entities that provide all different kinds of products and services. So this slide is not exhaustive but it's sort of illustrative of the diversity of types of participants in the industry.

The historical model of a utility still exists. It's called a vertically integrated utility.

That's a company that owns all levels of the supply chain, generation transmission and distribution.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 There are also independent power producers, which sort of started out in the 70s and have evolved over time. They only own generation facilities and they contract to sell power outlet to buyers.

They are transmission owners, again, which are sometimes part of vertically integrated utilities and sometimes independent and then load serving entities can take a lot of forms.

Sometimes they're local utilities.

Again, my Dominion example, or municipal, for example, utilities. And they buy energy wholesale and sell it to consumers. So there are a whole host of market participants that are involved in these complicated transactions.

So next slide. One last sector of the industry, one of the most prominent types of organizations that gets a lot of attention, is called the RTO ISO, that is the regional transmission organization or independent system operator. And this map shows the ones currently in North America and their footprints.

Two-thirds of the nation's electricity demand is located in an RTO ISO footprint. So most

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 of the country's electricity demand is served under that structure.

RTOs and ISOs are not for profit entities that are independent from market participants. They perform both grid operation and market functions.

First, RTOs and ISOs have exclusive responsibility for grid operations and transmission services within their footprint. They don't own any transmission. We talked about transmission owners at the last slide. Transmission owners turn over functional control of the facilities they own to the grid operator for a central operation.

All of the RTOs and ISOs also now administer both day ahead and real-time power markets that commit and dispatch the available generation, generation that's running or available to run to meet demand, the current power needs of the system at the lowest

cost, considering all of the physical limitations of the grid, or the transmission system.

Again, RTOs and ISO don't own any generating facilities. They just administer the markets.

Finally, very complicated and could be its own talk, some RTOs have centralized capacity

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 markets that set requirements for how much generation capacity is required to meet load at a point in the future plus a reserve margin and procure that amount of capacity for the load on that system. Not all of the RTOs have these centralized markets but three do.

Next slide. And this is my last slide.

I think I have it. I talked about rates and that's sort of the world that I live in, rate setting. But FERC also has an Office of Energy Market Regulation.

So, that's my office. But we perform other functions, market monitoring, enforcement as well as reliability. So I'm going to touch on those just very briefly.

On reliability, in 2005, Congress gave FERC jurisdiction to oversee the reliability of the nation's bulk power system. This actually does include ERCOT's bulk power system. It's different from our rate regulation.

Specifically, FERC is charged with ensuring that owners, operators and users of the bulk power system comply with mandatory reliability standards. And these standards are set by NERC, the North American Electric Reliability Corporation, which FERC has certified as the nation's electric

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 reliability organization.

So NERC develops the standards. They're approved by FERC. And NERC and FERC work together to ensure that all of the relevant entities comply with those mandatory standards.

As you can see on the slide, I think, NERC has divided certain responsibilities up among designated regional entities across the country.

With respect to enforcement, FERC has the authority to assess penalties for violations of statutes, orders and regulations.

And in 2005 again, Congress enhanced our enforcement authority so that the Commission can penalize violations for up to $1 million per day per violation and also gave the Commission explicit authority to penalize instances of market manipulations and not just violation of, you know, Commission order but a manipulation of a market in connection with Commission jurisdictional activities.

So all of these are relevant to some recent events. And they could all be talked about for hours and hours on end. I had eight minutes. So hopefully, this is a useful kickoff to the rest of

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 the panel discussion. Thank you very much for your attention.

COMMISSIONER WRIGHT: Thank you so much, Jette. That was a good presentation. I am personally this whole capacity market thing is something that -- I'm wondering how that is all going to play into the future of some of these, you know, periods like we just had down in Texas.

Would it have been a help, an asset? And then, you know, it's all about how these are put together, right?

Anyway, thank you so much. It was very educational and informative. And we could probably give you a whole hour, and you probably couldn't cover everything you needed to cover so thank you.

Arshad, the floor is now yours.

DR. MANSOOR: Thank you, Commissioner Wright. It's an honor and a pleasure to be here today.

In my introductory remarks, I'm going to focus on three key areas. One, what's the role of our existing U.S. nuclear fleet in the transition of the grid that we are envisioning over the next 10, 20, 30 years?

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Second, what is the opportunity to reimagine what flexible operation means for a nuclear power plant?

And third, the opportunity for the U.S.

to take the leadership back in the next generation of nuclear plants, like we did in the 80s when light water reactor and advanced light water reactor has formed the basis of what we have today, which is the largest carbon free source of energy.

But before I do my introductory remarks, I think all of us realize this is the week, this is the 10th anniversary of the earthquake in Japan and the terrible loss of life from the earthquake and the tsunami.

The event also resulted in the accident in the Fukushima Daiichi Nuclear Power Plant. And deservedly, there was scrutiny on the global nuclear industry. Ten years ago we had that event. And if you look back, the industry is actually stronger than where we were 10 years ago.

The industry came together, focused on resiliency, focused on high impact, low frequency events and the performance of the industry. You could see it even in the two weeks ago when we were

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 all talking about Texas events.

If you look at the Texas events, the high impact, low frequency events, and if you cut through all of the discussion but look at the data, the nuclear power plants at the ERCOT region, they contributed 80 percent of what they were expected to do to meet the peak load, every resource the grid operator and planner expects to meet a certain part of the peak load. No other resources contributed to even 60 percent of what they were expected to do.

If you look at polar vortex events in the past in New England and the PJM area, you see the same performance. So the resiliency of nuclear power plants, the diversity that nuclear power plants bring, we cannot lose that in the near-term when we transition to this low fuel carbon grid.

It's okay to have three cars in your garage and you have enough capacity. But if none of them start in the morning, you don't have any reliability.

And we need to value reliability. We need to value resiliency. We need to value inertia, not just value kilowatt hour. The largest source of carbon free energy, which is the U.S. nuclear fleet

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 today, to keep it operational the research that we're doing is looking into digitalization, modernization of the plant.

We've got to bring it to a place where it's safer, but it's also more affordable. We're doing a lot of work on what is thoughtful way to go and extend the life of these plants from 60 to 80 years.

But we also need to bring in the analytics to make sure that we are valuing the diversity, the resiliency, the reliability that the nuclear power plant will play in this evolution.

So that's what we need to do now. But let's step back and see what we can do in the next five years, which is reimagining what a flexible, nuclear operation needs.

So, flexibility typically means when electricity is not needed because there is excess wind and solar, you will reduce the power output of the plant. And as we know, some plants can do that.

For some plants it is difficult.

But we need to reimagine flexibility.

Imagine flexibility where when you have excess electricity, the nuclear power plant is producing

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 hydrogen. It's producing liquid ammonium. It's producing clean water, water desalination.

So we're producing another form of clean energy where electricity is not needed. And this is not just a vision. There is work underway at nuclear power plants, Xcel and Exelon, Department of Energy.

EPRI is working to redefine what flexibility means. Because if we can redefine this flexibility and come up with a way to operate the nuclear power plants to produce another form of clean energy when electricity is not needed, that will just provide another value stream and make it more affordable to continue to run the existing nuclear power plants. So that's the second thing.

The third one is actually the best opportunity we have for the U.S. to take the leadership role. We did that in the 1980s. EPRI was fortunate to work with the industry. What has evolved now, almost 40,000 utility requirements documents that forms the basis of light water reactor and advanced light water reactor.

We need to make sure that the U.S. takes the same leadership role in the next evolution of nuclear power plants. And if you look at the

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 research that is underway, the focus the Department of Energy has, private sector has and the industry has on reimagining the next generation nuclear power plant, before this decade is over, there will be an operational microreactor.

There will be an operational small modular reactor but that's flexible, that's safer, that's affordable but more importantly it is not constructed. It is actually fabricated. And there will be a non-advanced light water reactor.

So we have to redouble. We have to supersize innovation to make sure that this is the decade where we continue to operate the nuclear plant that we have today, continue to look at life extension, continue to look at how existing plants can be a flexible resource, but also do the research, do the innovation, do the technology advancement so that we can recreate the U.S. in a leadership position for the next generation nuclear power plant.

So that concludes my introductory remarks. It's always a privilege to be here. And I will be looking forward to Q&A in the chat session.

Thank you.

COMMISSIONER WRIGHT: Thank you. Thank

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 you, Arshad. You're always fun to listen to. You always have a wealth of information and knowledge to share, which I appreciate, and I know everybody else does, too.

Before I introduce the next two speakers, we're going to pause for a second and introduce another live polling question. And at the end of the Q&As, we're going to go back to those two questions with the results. And we'll talk about that for a moment before we go to the formal Q&A.

So the question this time is, what will be the first widespread new megawatt resource technology to become common with installed megawatt resource portfolios?

Again, you have a number of possible answers listed for you to choose from. So I would appreciate it you would lock in your answers while we proceed with our next speakers. And like before, the results will be displayed on the screen and any follow-ups from the presenters will be much appreciated either now or again at the end of the next two presentations.

So now let's proceed to our third presenter, Mr.

Kevin

Lynn, Director of Grid

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Modernization at the U.S. Department of Energy.

In his role, Kevin coordinates all activities focused on resolving the technical challenges that limit the integration of electricity generation technologies, electric vehicles, demand response and other technologies into the grid in a safe, reliable and cost-effective manner.

We're grateful for Kevin's insights on how DOE initiatives can help to modernize the electric grid.

And following Kevin will be our last speaker, Mr. Sammy Roberts, General Manager of Transmission Planning and Operation Strategy with Duke Energy.

Sammy is going to present on the key role of nuclear power in the clean energy transition. His operational experience provides a unique look at the real-time impacts of grid evolution from, you know, a utility and licensee. So, Kevin, we'll start with you. The floor is now yours.

MR. LYNN: Thank you so much. Thanks for the opportunity to speak. This is my first time being here so I'm very excited. Again, my name is Kevin Lynn, and I work for the Office of Energy

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Efficiency and Renewable Energy at the Department of Energy. And I also co-chair the Grid Modernization Initiative.

And so before I get started talking a little bit about the Grid Modernization Initiative, you know, we within the Department of Energy and the Energy Efficiency and Renewable Energy and the number of other offices we coordinate really focus on research and development.

So a lot of our technologies, you know, in EERE focuses about $2 billion annually in terms of a variety of technology research in solar and vehicles and hydrogen and a number of other technologies.

I originally came from solar. So I was going to talk a little bit about where I came from and how I ended up being here involved in grid modernization.

So about 10 years ago I was part of the SunShot Initiative. We were trying to lower the cost of solar by an order of magnitude.

By the end of the decade, by 2020, this was about 10 years ago, I was leading an effort that really focused on systems integration. How could we

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 integrate solar in a safe, reliable and cost-effective manner into the grid as it became more and more prevalent?

And it became very clear to me during that, while in that role, that we could never be successful in that role just focusing from a solar perspective.

And I think one of the people I'd really like to thank is Mark McGranaghan, who was from EPRI.

He was with Arshad. He was very instrumental and was one of the people that really sort of pointed that out to me. And I always really thanked him for that.

But I think now is where we actually looked at -- you know, if you're really going to be successful at integrating technology, like solar into the grid, you have to think about how your coordinate it with buildings, electric vehicles, hydrogen fuel cells, the power system itself and other generators on the power system.

And so that's how we ended up within EERE focusing on how can we coordinate and serve a grid integrational? How can solar and wind and vehicles and all these different buildings, all these different pieces work together in a coordinated way

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 to develop a more safe, reliable and cost-effective power system? That was the only way we were going to be successful even from a solar perspective thinking about coordination.

And working from 2015 through 2016, working with Dr. Moniz, we started the Grid Modernization Initiative, where we not only focused on energy efficiency and renewable energy technologies, but we worked with the Office of Electricity to develop a research plan, how we focused both of those offices working together to have a coordinated research portfolio to address some of the challenges with the power system.

And then moving into 2017, we are very excited to add the Office of Fossil Energy, the Office of Nuclear Energy, which we are working with very closely, and CESER, which focuses on cybersecurity, on electricity security and emergency response. All of this is sort of the foundational research activities that we all need to be working on together to maintain this research platform for the power system.

So that was sort of where I came from.

And it really became -- I think one thing that I would

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 take away that's really clear for me, and as part of this introduction, is you really have to think about how all those pieces work together to be successful.

And that's one of the things that I've definitely learned. And it's why I was really excited to work in this area.

So if we could move to the next slide.

So some of the drivers of change, you know, some of them are very familiar to you. We have a changing electricity generation portfolio, a lot more wind and solar coming online.

We have a

lot of new resiliency challenges. We talked about Texas a little bit already. Cybersecurity has become more of a challenge. And I think we have a lot of really interesting things, drivers at the edge of the grid.

So if you're thinking about consumers who typically have been using electricity, but now we're thinking about those consumers who actually cannot just use electricity but can actually provide services to the grid so they can actually make it a more safe and reliable power system as well.

So some of these things are coming together sort of to change the actual -- not only

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 from a technology perspective but from a business model perspective. And I think some of the other

things, you

know, from a

new administration perspective, the zero-carbon goal for 2035, that obviously is a major driver for us. And I think nuclear will play a major role obviously in that, achieving that goal.

And I think, you know, other things like social equity, trying to think about in the context of Texas, trying to make sure when power does go out, people, you know, it's not just one class or one economic strata that actually get affected most, you know. There are opportunities for everyone to have resiliency as part of their system, of having a more reliable system.

So those are some of the other sort of drivers of change that I think we think about as we move forward, especially from a research perspective, into this new administration.

Next slide. So this is, you know, if you look from -- if you've seen a slide similar to this, I think, in the beginning where we're looking from the transmission to distribution system, generation transmission and distribution, I think one of the

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 things that we look at, you know, there's going to be a less discrete, you know, transmission generation and distribution, you know, somewhat discrete now but some of them are coming together a little bit, sort of a confluence between the transmission and the distribution system that's happening today.

I think the other thing that we're also looking at when we first started this, we were looking at just mainly the power system. But we were also looking at the confluence of other infrastructures.

So obviously with Texas, what was the impact of natural gas? It had a major impact on the way the power system operated. So what's the confluence with the communication system, with electric transportation?

All those other infrastructures are working together within the power system and have impacts on its reliability and resilience. And those are things that we think as part of this Grid Modernization Initiative moving forward.

Next slide. So if I were to say, what is this grid modernization R&D portfolio in one slide, if you look in the center, that sort of formulates the areas of activity that we think are

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 important.

We don't know -- we're the first ones to say that we don't know what the electric power system of the future is going to look like, but we do know what the no regret strategy looks like.

We know that we have to focus on intelligent devices -- sorry, if we could go back one

slide, thank you sensing a

measurement, observability is incredibly important, controls, planning, technologies, new types of generation and how do they impact the power system, security, cybersecurity, all these different pieces of resilience. All of these pieces have to be part of our research strategy moving forward.

And I think the final one is sort of the institutional support. And that's sort of broad.

Like there are all sorts of things changing so rapidly on the power system. And it's really important for commissioners and others and important stakeholders to make decisions about when the power system is happening to have the latest information about what are the implications of that R&D moving forward.

On the left and right-hand side, you can see some of the offices that I have mentioned already

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 that are part of this Grid Modernization Initiative from the Department of Energy, Fossil, Nuclear, EERE, Office of Electricity and CESER.

On the right-hand side you can see 14 of our 17 Office of Science national labs who are working together to help us develop the strategy and some of the activities that we do within the Grid Modernization Initiative.

I'm really happy the way that they have all come together from discrete labs working together to help solve this major challenge and address some of the challenges that we have with grid modernization. That's been a real success for us.

Next slide. This just sort of outlines some of the activities that we've done. We've done about $300 million of research over the last five years in an integrated way across multiple offices, through three major solicitations.

Our first one focused on our multiyear plan that we developed in 2016. We then focused on resilient distribution systems, really looking at the resiliency of the distribution system. And those projects are coming to fruition this year after 3 years.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 And then in 2019, we actually did another

$80 million of work out of research to look at 25 different projects that are underway right now. And I'll touch on a few of those projects just to give you a feel about what kinds of research that we're doing.

But just to let you know that we are --

over five years, one of the longest coordinated efforts, we're co-funding across multiple offices to work on foundational challenges with grid modernization so how we try to coordinate and find those pieces together.

So next slide. So this is just an example, if you could go through this slide and the next slide, some of the partners that we have. I mean, it's really important -- for us to be successful, we have to work with our utility partners, a variety of stakeholders, utilities, industry, non-governmental organizations like EPRI and others, thePSC, Public Utility Commissions, all of those are just key for us to be successful. And if we're not working with those partners at this level

-- and we have about 150 partners that we work with has been really core and important for us.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 So I think with that, I mean, there's a couple of different projects that I'm going to mention and I'm going to ignore some of the slides here. But the first one I wanted to talk about was HELICS. And it's called -- we love our acronyms.

It's Hierarchical Engine for Large-Scale Infrastructure Co-Simulation.

This is an actual -- as I mentioned before, looking across infrastructures is so key.

And we don't really have models that do a very job at looking across all these different gas and power system and transportation, how all these different models work together.

So HELICS is a way for us to start trying to piece together some of the models and find the interdependencies between those models and actually try to understand implications.

What happens when natural gas pressures drop? What happens when you start putting in hundreds of thousands of electric vehicles into the power system? What are the implications of putting in a 5G communication network? Those are the kind of questions that we need to really have answered.

And that's the kind of co-simulation that we've

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 developed to try to work on.

I think a second one that I wanted to mention that I think is interesting, especially from a nuclear perspective, we call it flex power.

So flex power is, you know, we're really looking at trying to think about, you know, a lot of times you can think about if you have a particular generator, I'll say a solar generator. I'll say a solar generator or energy storage or wind or a nuclear generator or a hydrogen, you know, what is the benefit of having those things working together as a hybrid system?

And, you know, part of the question is, does one plus one equal three? Do we get more from a hybrid system working together than we would if they were all working independently? And that's part of what we're trying to look at from a flex power perspective.

And then I think of a third project that we're actually working together with EPRI on and we mentioned with ISOs is we're actually trying to look at that with all the independent system operators that manage the grid at different retail wholesale markets.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 How can we look at and understand what they see as some of their challenges over the next 5 or 10 years from a technical perspective and how can we work with EPRI and others to try to help address some of those challenges that they see coming on the horizon in the next 5 or 10 years?

So there's a variety of both technical and sort of market driven challenges that we see as very important as a no regret strategy moving forward. So hopefully that's helpful to give you a little flavor of what we do at the Department of Energy in this coordinated effort. And I look forward to any questions that you have. Thank you.

COMMISSIONER WRIGHT: Yes. Thank you, Kevin. That was good stuff. And, you know, before we introduce Sammy, you know, one, I can tell there's never a dull moment over at DOE. You all are -- we kind of look at you all as the promoter, and we're the safety regulator, right, especially on the nuclear side and FERC's role as well.

So in a way, and I'm kind of teeing this up a little bit because Sammy's coming up next too, but, you know, what happened in Texas kind of made people start thinking, you know, is the old way kind

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 of a new way again, right? There's differences between vertically integrated systems and markets.

And one of the things that is, I think, a key driver and something that was highlighted, I think, during this time was, you know, in the vertically integrated markets, like in the South where I come from, the integrated resource planning is really critical, and it's key.

And I wonder is -- you know, there's got to be more discussion about how that's going to be actually taken into account in some of these areas that had issues during the last month.

So with that, you know, Sammy, you're up next, and I want to thank you for patience. And the floor is now yours.

MR. ROBERTS: All right. Thank you, Commissioner Wright. So what I want to talk about is Duke Energy's key role of nuclear in our clean energy transition.

Next slide. And really the area I want to talk about is in the Carolinas. We actually have a service territory in the Midwest, and we're in both MISO and PJM in the Midwest. We have some gas service territory in Tennessee and then also Florida.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 But today I just want to talk about the Carolinas. And as Commissioner Wright was saying, they are vertically integrated utilities as is our Florida business unit.

Next slide. So we heard about the importance of resource planning, integrated resource planning. It just has different components to look at now, and it needs to integrated. I think all of our speakers hinted on that with respect to integrating everything from fuel planning right down to customer behavior.

All of it has to be looked at holistically now with respect to your resource plan.

In the future, you're going to have demand response and customer behavior, probably EVs as a resource, EV to grid resources that participate in this resource plan. And so you're going to have to know how powerful it is on your transmission systems.

The same with DERs with Order 2222 that FERC recently published and that the RTOs and ISOs will be filing plans for soon, that's going to affect how power flows occur on the transmission grid and how upstream generation needs to respond.

So I think integrated resource planning

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 is going to be extremely important going forward.

This picture graph just shows one of our portfolios, one of our six portfolios in our recently filed 2020 integrated resource plan.

We had to file resource plans in North Carolina and South Carolina with their respective commissions every other year, every two years we file a comprehensive plan. We file an update the alternating years. But this one reflects our 2020 filing, and you can see we started our journey all the way back in 2000 with respect to emissions reductions. And it was primarily associated with NOx and SOx then with NC Clean Smokestacks Act, but we did reduce coal over 3,000 megawatts, 3 gigawatts, going from 2000 to 2020.

Going from 2020 to 2035 for this portfolio, reducing coal yet again another I think it's 6,000 megawatts. And so you can see there's going to be significant coal reductions.

What are we replacing that with? There's going to be a lot of solar. There's going to be some battery storage. There's going to be gas. We need to gas a transition fuel. And these pie charts reflect that going from 2020 to 2035.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Next slide. So what has influenced our changing resource mix in the Carolinas? As I mentioned, we have NC Smokestacks Act back in 2001.

And that primarily was targeted at reducing NOx and SOx by 2013. Also our general stack with respect to resource planning, we have least cost requirement in North Carolina in the general stack, too. And we have a least cost consideration along with some other considerations for our resource planning in South Carolina with the new Energy Freedom Act, Act 62.

In addition to that, we had a renewable energy and energy efficiency portfolio standard introduced in 2007 in North Carolina where it mandated that 12-1/2 percent of our retail electricity sales had to come from renewable energy resources by 2021, this year.

We met that easily. One of the reasons is we had a confluence of favorable factors for PURPA solar. One was high avoided cost rates. At the time it was between $55 and $85 a megawatt hour.

We had a state income tax credit and then you had the federal income tax credit. And the federal income tax credit is still going. And now it's 26 percent through 2022, stepping down to 10

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 percent by 2024.

So all of that gave us a lot of PURPA solar on our system connected -- a lot of it connected to distribution.

Then we had House Bill 589, which was a competitive procurement for a renewable energy bill that passed through the House and Senate and got signed into law. And that was to procure an additional, about 2,700 megawatts of renewable energy, primarily solar, over the next 25 months.

And more recently you had, as I mentioned before, the South Carolina Act 62 and that had some provisions for requiring purchases of PURPA solar for 10 year contracts.

And if you look at the percent of load, that's a little over 1,000 megawatts of solar in South Carolina.

Next slide. So what is that starting to look like for us? Well, we've got a little bit over 4,000 megawatts of solar and we're about -- if you combine the systems, at a 36,000 megawatt peak, so about a ninth of our total megawatt nameplate resource is solar.

And you can see we're not the irradiance

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 capital of the world with this graph to the upper right. You can see one blue sky day there with a pretty nice solar curve, but all the others were influenced by cloud cover or rain. And we have consecutive days of cloud cover and rain.

And we're not the Mojave Desert or, you know, southern Arizona or near Las Vegas Nevada where you have a lot of consecutive clear blue-sky days where you can get a lot of solar production. We have varying amounts of solar from day to day and sometimes, again, consecutive days of low solar.

Also, intermittent cloud cover, we have to maintain operating reserves on our system to handle the volatility of solar as you can see in the lower right-hand corner.

So when we're planning resources to integrate more solar, we need to take this into consideration. And we need to have a back stand for those days that the solar output is not high. And if you have consecutive days and you're counting on solar for storage, it may not be there for that storage purpose.

Next slide. Another impact that we've seen that we've been challenged with, we've had to

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 deal with, and we have dealt with it, is with respect to our network modeling in our energy management system.

So as you can see on the right with our winter-type curve, solar is not conforming to that winter-type curve. And in the past, state estimation that estimates the current state of the system with respect to voltages and power angles, it basically assumes that each one of those little triangles there which are T to D subs, transmission to distribution subs, it assumes that the load on the other side of that is fitting this traditional shape. Do you see that winter gray shape on the upper right graph?

Once you connect solar to those distribution feeders, it dramatically alters that shape. And if you have an estimation tool where those statistics say I'm going to assume that you're meeting that traditional gray shape, you can get in trouble with your state estimation, and it won't be accurate.

Well why is that important to nuclear plant operations? Well, that state estimation is very critical to our real-time assessments and our real-time contingency analysis. And that tool is

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 critical to determining post-trip switchyard voltage at nuclear plants.

And post-trip switchyard voltage, making sure you can maintain minimum required post-trip switchyard voltage is a nuclear plant interface requirement tied to their license.

And so we've had to wrestle with that.

And we're going to have to wrestle with it again when we start connecting storage to distribution as well.

Next slide. So what is our future going to look like? You know, we're optimistic that it's going to be sustainable. It's going to be reliable.

It's going to be resilient. It's going to be cost-effective. It's going to be clean. And it's going to co-exist with all the resources that are connected and the new customer behavior with electrification that we're going to see.

And so we're planning in that manner.

We're going more and more toward 8760 type integrated planning all the way, once again, from fuel at the beginning down to the customer connected to that distribution feeder.

We do have some new policy coming into place. We have an NC governor Executive Order that

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 says we'll reduce greenhouse gases, power sector greenhouse gases, by 70 percent by 2030 and go to carbon zero by 2050.

And then also in-house, we declared about 10 days before that we declared our goals for Duke Energy being 50 percent by 2030 and 0 by 2050.

And then more recently you've had House Bill 4940 in South Carolina, which is going to require studying the potential benefit for market reforms.

Are there markets that can create value for the customers?

And so all of that is going to combine into affecting our resource nets of the future. And what will this pie chart look like in 2050? I don't think anybody can concretely say this is what it's going to look like.

So I just took a guess at all the different types. Looking at kind of where some of our portfolios are aggressive where carbon reduction are going, and it's got hydrogen in it. It's got small modular reactors in it. It's got more solar.

It's got wind, offshore and onshore. It's got battery storage.

And there's going to be tons of new

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 technologies coming about as well. I have a feeling this battery storage won't be lithium ion in the future. It will be more flow batteries because I think lithium ion is going to be consumed by the EV sector.

And so those are things that we have to plan for and integrate into our planning to make this work to accomplish all those different attributes that I mentioned with our future.

Next slide. All right. Well, that's the end. The one thing I would like to add though is our nuclear fleet is going to be super important in that mix.

Our nuclear fleet currently have extended licenses for 60 years. And we're going to go after subsequent license renewals to go out to 80 years.

And I think it's going to be a must have with respect to being able to accomplish our clean energy goals.

COMMISSIONER WRIGHT: Thank you, Sammy.

I appreciate that very much. That was a good presentation and very educational. And I will say it brought back memories of my time serving down in South Carolina on the Commission. I would go all the way back to even before the old Save-a-Watt program

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 down there. That's good memories and thank you so much.

I want to thank each of you for your presentations today. This has been a lot of valuable information. A lot of stuff to digest and to consider as we go forward.

And to the producer, before we go to the Q&A, I'd like to revisit the first two polling questions. If you could put the first question up, I want to see the results. Let me see if anybody has any comments on it.

So the first question to the panel, to everybody, was what is the biggest challenge to a modern grid in the 21st Century? And as you see the answer that got the most looks like it was the dispatchable small modular reactors.

And then on the second question, what was the biggest challenge to a modern grid, is that one

-- can you put that one up, the second question? You can't?

So anyway let's just address the first one, the answer to that first one, did any of you have any comments that you'd like to make based on what you saw in those responses? Anybody?

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 MR. ROBERTS: Yes, I will, Commissioner Wright. So I think eventually small modular reactors or molten salt thorium reactors, I think, eventually that will get commercial and will be a great asset in the future portfolio.

Initially, though, I think with, you know, kind of the kick-start that FERCs 2022 has pushed along with aggregated DER participating as a resource, I think we'll see that start to take off a little bit with respect to being a viable resource.

The one thing that we need to get right there though, we've got to get right, is with respect to making sure it's visible, making sure you're aware of it, making sure it's coordinated and making sure it fits or is considered in the transmission plans because even if the DER doesn't push reverse power onto the system, it still impacts transmission flows and still needs to be considered.

But I do see aggregated DER as being a first mover. It already is moving. And eventually I see the small modular reactor or like the thorium molten salt reactor coming along and being commercial and being a viable alternative.

COMMISSIONER WRIGHT: And I did notice

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 on that first question that the electric vehicles along with the aggregated DER, they came in at like, 40 combined, so about 20 percent each.

So did anybody else want to comment on that first one, that first question? If not, we'll go to the second question, if you could put that second question up for me. What is the biggest challenge to a modern grid in the 21st Century?

So aging infrastructure looks like it's leading the charge and changing mix and types of electric generation, load following, it looks like it's -- does anyone want to comment on that? Do you agree with it? Don't agree with it?

DR.

MANSOOR:

Well, I

think, Commissioner Wright, the way I see it is the one that's missing there is if you are looking in the future in the not too distant 2040, 2035, you will have two things that's

happened, which is electrification will result in societal dependence on electricity to be significantly more than what we have today. And even if we reach net zero, our weather pattern will change and one of the ten-year events will become one of the five year events.

Both of these will require us to have a

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 grid that is much more resilient than what it was designed for. And how do you make the grid resilient?

Is it just a

generation

issue, transmission issue, microgrids? And who pays for it?

I think that would be all of the biggest challenge to achieve a low carbon future is how do you get to that level of resiliency that society will expect from an energy source, electricity, which may be double in 40, 20 years on how much we use today compared to what we have in 2040.

COMMISSIONER WRIGHT: Thank you. Anyone else? No. All right. We're going to get into --

we've got about roughly 20 minutes or so left. And, Jette, ladies first, I guess. I want to come to you.

You explained in your presentation that FERC had some authority related to reliability of the grid in Texas. So is FERC taking any action in response to the recent cold weather events and the reliability issues we saw in Texas?

MS. GEBHART: Yes. So because, as I mentioned, FERC's reliability authority does govern the supply to the ERCOT grid, FERC has announced it is doing a joint inquiry with NERC into the operations of the bulk power system during the extreme weather

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 conditions.

So, you know, they will look into the event, causes, effects and make any recommendations as needed. So we're doing that reliability inquiry.

The Commission also announced that, as the Commission always does, our Office of Enforcement monitors market operations to see if they detect any instances of market manipulations. So that's also an ongoing activity related to the Texas events.

COMMISSIONER WRIGHT: All right. Thank you.

MS. GEBHART: I also wanted -- also I think relevant to some of the comments that other folks made on extreme events, extreme weather events, is that FERC is separate from Texas but looking into kind of what are the challenges of the grid and how can we better prepared in the future.

FERC has announced that we will be conducting a technical conference looking into the effects of climate change and extreme weather events on the reliability of the grid.

COMMISSIONER WRIGHT: Okay. Thank you.

So, Jette, I'm going to stay with you because I think

-- I'm looking at one of the questions that was

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 submitted in here. And it might be that each of you might maybe want to add something or talk to this one.

It's a very simple question. Do we need RTOs and ISOs? And if the southeastern U.S. grid operates without an RTO or ISO, what does the Mid-Atlantic, the Northeast and Midwest do? That's a pretty big question.

MS. GEBHART: Yes. That's a big question. But I think, you know, all of the RTOs and ISOs study their value propositions. And over the years, they have shown billions of dollars in savings that result from RTO/ISO operations. And largely it's because of access to a broader portfolio of resources.

So you have access to lower cost power supply that you wouldn't necessarily, if you were just looking at a small footprint, for example, in the Southeast.

So that is one of the advantages of RTOs and ISOs. You also have the access to broader transmission planning so planning for more cost effective or efficient transmission facilities over a larger footprint.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Those are the values of RTOs and ISOs that are often expressed. And I think that the value of markets is being played out, even in the areas that don't currently have RTOs and ISOs, because different areas of the country are looking at more market type functions where, again, resources can be shared more broadly so there's the energy imbalance market that covers much of the Pacific Northwest.

They work with -- as administered in the California ISO.

SPP is working with the western states, the Rocky Mountain states, to provide an in-balance energy service there.

And although I can't talk about it because it's pending before the Commission, even a group of southeastern utilities has filed a proposal to basically administer -- it's not a full market construct but, again, a more efficient way of buying and selling power so that there's broader access to low cost resources.

COMMISSIONER WRIGHT: Anybody else want to take a shot at that question? Anybody? Okay.

We'll move to the next question.

So, Kevin, I'm going to come to you. So

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 I got a couple of things for you. One, you know, and this is your opinion, your opinion only, right? You don't get -- how likely is that you think that zero emissions can be achieved by 2035 because I think we hear different things from different people.

And then I'm going to come with a second question that has to do with -- that was asked, what are your thoughts on application if risk informed approaches, you know, like probabilistic methods to the grid, you know, for resiliency evaluations. What are your thoughts on that?

MR. LYNN: Well, thanks, yes. I saw those questions. You know, I think from my perspective, you know, 2035 for a zero-carbon power system is an aggressive goal. But, you know, I grew up in Florida pretty near Cape Canaveral, and we went to the moon in 10 years. So it's definitely a possible thing to do.

And I think there are things that, you know, I feel very confident from a research and development perspective that we can look and investigate and answer the questions that need to be answered regarding what do we have to do to actually implement the right kinds of technologies in order to

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 reach that goal.

Obviously, there's a lot of policy levers that have to be pushed in order to get there. I mean, DOE just does the research and development and does some demonstration and appointment. But, you know, it's going to be the utilities, you know, thousands of different utilities making those kinds of decisions, our policy, you know, federal policy making or state policy making that makes those decisions in order to get to those goals.

Do I think we can get there from a research and development perspective and have the right technologies in place? Yes, I do. But, you know, it's an aggressive goal, and it's going to take a lot of things falling together for us to actually be able to reach it.

Jumping to the second question regarding probabilistic methods for risk. I think, you know, that's something that we are constantly looking at different probabilistic methods for a variety of different things, including risk, you know, whether

-- even like renewable forecasting probabilistic methods for that.

You know, we've been working with our

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 Grid Modernization Laboratory Consortium to think about what some of the different ways are that we can think about resiliency and risk around a variety of different resiliency challenges. And each one can be different, you know, whether it's wildfires in one place or hurricanes in another place or ice storms in another place, all of those are going to have different risk profiles.

And I think as Arshad said very well, one of the things that I think we all should be a little concerned with is the one in ten year event becomes the one in five year event. Or even, you know, it could be a completely new or different event depending on how climate changes over the next, you know, 5, 10, 15 years.

So one of those things is, you know, a lot of times your probabilistic is based on data that you've had in the past and how accurate is the data going to reflect what happens in the future?

So, yes, we are definitely looking at different probabilistic approaches. But it's going to be a challenge as we move potentially into a different climate region, you know, trying to make sure that we're addressing all of the appropriate

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 challenges in an unsure future.

COMMISSIONER WRIGHT: Thank you for that. Anybody else want to tackle that?

DR. MANSOOR: Maybe just one thing related to -- if you look at is it achievable? By 2035, can we go net zero in the power sector? I think the right question is how much more we can go by 2035 when we look across the economy.

If you look at today, the carbon emission in the U.S. is approximately 5 gigaton per year. Of that, 1-1/2 gigaton is electricity. The rest is transportation, buildings and industry.

If you take the electricity sector, that has to be the tip of spear. But to get to 100 percent clean if it impacts the price of electricity, it will actually deter electrification of transportation.

So the optimization we have to do is how can we go to 2035 and maybe take the 5 gigaton emission that we have today and make it half of what it is but look at it economy-wide? The optimization has to be done economy-wide because the electricity is the fuel to decarbonize the other sectors and the other sectors are now 3-1/2 gigaton compared to electricity at 1-1/2 gigaton.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 COMMISSIONER WRIGHT: Okay. Thank you.

All right. Sammy, I'm going to come to you. Several nuclear plants have been retired due to market pressures in the last few years. So with the current emphasis right now on reducing greenhouse gases, do you think that changes that trend or that outcome?

MR. ROBERTS: I mean, I think nuclear generation is definitely going to be viable for a long time. And that's one of the reasons we're looking at subsequent license renewals.

And also, if you look at the current viable zero carbon resources that are available to replace the zero carbon electricity we get from nuclear generation, produced by a nuclear plant, the results are a little bit eye opening.

If you wanted to replace a zero-carbon electricity produced annually by our 1,000 megawatt Harris plant with solar plus storage, it would acquire approximately 6,300 megawatts of solar, nameplate solar. It would require 3,800 megawatts of 6-hour battery storage. It would take up 61 square miles of land area. And it would cost $14 billion over a 20-year period.

COMMISSIONER WRIGHT: Okay. Thank you.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 So, Sammy, I'm going to stay with you for a second.

Do you have any life -- it's a question we got. Do you have any life cycle information regarding your solar fleet and also if gas is used as that transition fuel, what is the destination power source?

MR. ROBERTS: Right. So gas is what we're looking at as the transition fuel because once again we're required under general statutes to pursue least cost. And if that fuel is -- that generation is least cost and allows us to meet those clean energy goals and absorbing more renewables -- you saw the solar variation from day to day. We've got to accommodate that.

We've got to still be reliable and serve all of the energy under the demand curve with the resources that we have from day to day. And if we're getting reduced solar from one day to the next and then the next few days, we get blue sky days. And we get about the full, almost the full nameplate at peak solar output, we've got to use that energy that's being produced to serve that energy under the curve day in and day out, 24/7, 365.

And so I think if we're going to absorb a lot of solar on our grid to be able to move towards

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 those clean energy goals, then we're going to have to have the flexible generation to manage that to meet the NERC standards, to serve all the energy under the curve to regulate, et cetera, balance. And that generation resource, firm dispatchable resource, is looking like gas generation to us in our resource analysis and planning.

So that's what we're seeing as the bridge fuel. And then we're hoping that those nuclear technologies emerge. And, you know, we can count on something like a small modular reactor or a molten salt reactor, something to that effect, to be that replacement generation for that gas fire generation.

COMMISSIONER WRIGHT: Thank you, Sammy.

So, Arshad, I'm going to come back to you here.

Nuclear plants have traditionally been seen as baseload assets focused on a capacity factor, getting to 100 percent and staying there for as long as they can. And, you know, that's been the definition of success.

Some markets now are leading the nuclear plants to operate at some limited level of flexibility. And some of the future with these increased renewables and maybe hydrogen generation,

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 how do you see the role of nuclear evolving?

DR. MANSOOR: I think in the introductory remark, I think I mentioned that we have to reimagine flexibility. And the Department of Energy is actually funding several projects, demonstration projects with Xcel Energy, with Exelon -- EPRI is fully involved -- which is can we produce something other than electricity when electricity is not needed? Instead of just backing off from the plant, let the plant continue to work at the 100 percent capacity factor that works best but not all of the electricity goes to the grid. Some of the electricity goes to produce hydrogen through electrolysis.

And as Sammy mentioned, I think, what is the destination power source? In addition to nuclear, we have this low carbon resource initiative, which is a five year initiative, 40 utilities engaged. It could be the transition fuel from natural gas becomes a combination, a mixture of natural gas and hydrogen and renewable gas.

And we actually are running on gas turbines on this combined fuel. and over the period of the next 10, 15, 20 years, there are already

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 designs for running gas turbines on 100 percent hydrogen. And nuclear could be a resource to produce that hydrogen. So that's the future flexibility we are looking at on the nuclear power plant, not just to back off on power.

COMMISSIONER WRIGHT: Very good. So what do you -- from your perspective again, Arshad, and anybody else who can chime in on this one, what are the major headwinds that are facing nuclear, right? And here in the long-term, you know, is there anything -- what can we do or what can be done maybe to address that? Arshad, I'll start with you.

DR. MANSOOR: I think two things. One, in the near-term, we've got to make sure we are modernizing the plants so they are operating safely but at a lower cost. And if you look at the plant in the last five years, we have been able to reduce the cost and actually enhance safety. But that's one piece of the puzzle.

The other piece of the puzzle is especially in markets we have to value reliability, resiliency, inertia, diversity because if we don't, and if we are only valuing capacity and energy, then it will continue to take nuclear out of the mix.

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 And in the long run, forget about net zero, even if you want to go 80 percent clean in our sector by 2035 and if we lose the 100 gigawatt of nuclear power plants we have today, there is no chance we'll get there.

COMMISSIONER WRIGHT: Anybody else want to address that? Anybody? All right. So we've got about five minutes to go or so.

Let me ask a question of everybody here.

So do renewables plus maybe battery storage long-term, right, have the capacity to replace nuclear over the course of the next 30 years? Any opinions on that? That was a question that was asked.

Anybody?

DR. MANSOOR: I'll step in. I mean, Sammy already answered the question. Is it doable?

Yes. We can put PV in the space and bring back power to the arc. Technically, it's doable.

Is it feasible? Is it practical? Is it economical? Is the right use of land? No. Where solar and wind and battery comes in, it will become a peaking resource. We are looking at a four-hour peaking resource, six hour peaking resource, in the future maybe an eight hour peaking resource. If you

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 want 24/7, 365, yes, you can do solar, wind and battery but that will neither be feasible nor economical to replace these type of baseload plants.

COMMISSIONER WRIGHT: Okay. And I've got a couple of questions here I think we can -- one is a general question for everybody. So do you foresee an integrating grid from coast to coast in the future or perhaps communities becoming more standalone or more independent off the grid somehow?

Any thoughts or feelings on that? And what would that mean?

MR. LYNN: Maybe I'll take a shot at that one. I mean, I think that, you know, either is an interesting path forward, right? I mean, I think we've looked at how could you build a more regional power system or how could you build, like, large --

we had a project called Seams where we were looking at how you can build a high voltage DC transmission grid across the west and east.

So both are feasible, I think, you know, and both may have a role. I don't know if you necessarily have to choose one over the other. And I think, you know, even though we have one large power system, there's a lot of different attributes to that

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 power system in different regions of the country, and they have different needs.

So it's not really a one size fits all for everything. So I think there will be aspects of more of a regional or more microgrids where that plays a role. And there will be somewhere, you know, larger transmission whether it's, you know, regarding offshore, offshore wind or something like that, where large scale transmission will play its role as well.

So I don't think it's necessarily an either or.

COMMISSIONER WRIGHT: Anyone else? No?

So, Sammy, I'm going to come back to you really quick.

In your presentation, and there's a question asked, you mentioned that SMRs might be a part of your future mix.

Are existing nuclear power plant sites potential locations for those new power sources?

MR. ROBERTS: Yes. I think wherever the interconnection is best suitable. And you can take advantages of shared staff and that sort of thing.

I think, you know, you look at those economies to determine your best locations. But I could see one being co-located out of our nuclear suburb.

COMMISSIONER WRIGHT: Okay. And I'm

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 going to give you one last chance here to kind of say something to close out the panel session and maybe your thoughts on, you know, what do you see happening next? What is the next step in this whole process and what can we expect, right? And then what is it that we don't know that we need before we can really make that next step? If you all want to take a shot at that, we've got a minute and a half. Anybody?

DR. MANSOOR: I'll take a shot at it.

And I think the next step -- the Texas has clearly opened the discussion that we're focusing on a net zero future. That focus needs to be even more heightened on a more resilient future.

Resiliency and decarbonization needs to be put in the same setting. And we've got to look at how to do both.

And the second biggest unknown is if both of your cars are electric and society is using 40 percent of the energy as electricity compared to 20 today, what is the expectation of the society on how reliable and resilient that grid needs to be?

We don't know that. How do you value that? How do you pay for it? How do you make the investments? I think those are some profound

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(202) 234-4433 WASHINGTON, D.C. 20005-3701 (202) 234-4433 questions that we will have to answer in order to get to this net zero future.

COMMISSIONER WRIGHT: It kind of gets us to the chicken and the egg, right, again? Somebody has got to go first and be willing to do it, right?

DR. MANSOOR: Mm-hmm.

COMMISSIONER WRIGHT: Well, so to each of you, to Jette, to Arshad, Kevin and Sammy, thank you so much for your insights and your willingness to make this the panel that it was.

Thank you so much. It was good. Nice conversation. I really appreciate the time. And if that's all we have; we're going to close this session and tell everybody thank you for watching.

(Whereupon, the above-entitled matter went off the record at 2:44 p.m.)

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