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SRP Board Approves System Plan Strategies to Bring Customers Affordable, Reliable and Sustainable Power

Oct. 2, 2023
The strategies are outlined in SRP’s new Integrated System Plan, which was developed as part of a two-year, data-driven planning process that incorporated perspectives from Arizona universities, businesses, and environmental organizations.

SRP’s District Board of Directors today approved power system strategies to be implemented between 2025 and 2035 that prioritize affordability, reliability, sustainability and customer focus. The strategies are outlined in SRP’s new Integrated System Plan, which was developed as part of a two-year, data-driven planning process that incorporated perspectives from Arizona universities, businesses, environmental organizations, limited income advocates, nonprofits and more.

SRP is one of the first U.S. utilities to shift from an Integrated Resource Plan (IRP) to an Integrated System Plan. The previous planning process is traditional for the utility industry and mainly considers what power resources will be needed. SRP’s Integrated System Plan is a holistic roadmap for its future power system that factors in evolving customer energy needs and achieving SRP’s 2035 carbon reduction goals. The new plan was developed through collaboration with stakeholders and involved modeling potential system plans under varying Valley growth scenarios and possible regulatory and supply chain environments.

"We are projecting energy demand increases of more than 25 percent by 2030," said Angie Bond-Simpson, Senior Director of Resource Management at SRP. "The Integrated System Plan will strengthen and prepare our grid for a future that’s largely powered by renewable energy without sacrificing the affordability and necessary power reliability to best serve one of the nation’s fastest growing areas."

Findings from Integrated System Plan customer focus groups and two customer surveys with more than 1,400 respondents underscored the need for SRP to primarily ensure affordability while maintaining power reliability. Customers are in favor of SRP progressing toward its carbon reduction goals, though showed preference to future system plans with lower generation costs and reduced bill impacts.

Resource Additions Must Include Wide Range of Technologies

The Integrated System Plan process determined SRP will need to double or triple power resource capacity from a wide range of technologies in the next decade to continue serving SRP’s growing customer base affordably, reliably and sustainably.

SRP’s plan prepares to add 7,000 megawatts (MW) of new renewable resources, which includes 6,000 MW of new, large-scale solar resources by 2035. This is enough solar energy to power more than 1.3 million average size homes and will triple SRP’s current extensive portfolio of solar resources scheduled to come online by the end of 2025.

The Integrated System Plan also prepares to add 1,500 MW of new battery resources and 1,000 MW of long-duration energy storage capacity from pumped hydro by 2035. This is enough energy to power more than 560,000 average size homes. This new storage will be in addition to SRP’s existing large investment in storage resources, including more than 1,100 MW of battery projects to be online by the end of 2024. 

The strategic resource additions from the Integrated System Plan will also contribute to a 56% overall reduction in SRP’s water used by power generating resources from 2005 levels. 

Power Reliability with a Customer Focus

This summer SRP saw a multi-day, record-breaking peak energy demand on its power system that beat previous summer records by more than 7% for an extended period.

To help ensure continued reliability of SRP’s power system, the Integrated System Plan recommends SRP prepares to add 2,000 MW of natural gas by 2035. These resources will support the grid as SRP integrates more solar, battery and other renewable resources, and SRP moves forward with the planned retirement of more than 1,300 MW of coal.

"With the Valley’s extreme temperatures, customers can’t afford blackouts like some of our neighboring states have experienced," said Bobby Olsen, SRP’s Chief Planning, Strategy and Sustainability Executive. "It’s critical we use technology and infrastructure like fast-ramping natural gas to keep the lights on, families safe, and monthly bills low as we deliver more clean energy."

Compared to SRP’s previous IRP, the Integrated System Plan studied a broader scope of system needs and implications beyond adding new power generation. The Integrated System Plan also factored in construction of large electrical transmission to carry power across the state, local electrical distribution to deliver power to new homes and businesses, and transforming customer energy programs and usage patterns.

As part of this, the Integrated System Plan analyzed the anticipated influx of electric transportation and electric heating and cooling in the next decade. To account for greater customer adoption of these technologies, the Integrated System Plan recommends SRP will need to evolve customer programs – such as demand response and energy efficiency programs – to help shift when energy is consumed and conserved.

"SRP has provided water and power to Arizona homes and businesses for more than 100 years. Our plans for a sustainable future will continue this legacy without compromising reliability and affordability," said Olsen. "SRP will continue to report on its progress carrying out the Integrated System Plan strategies and find innovative ways to decarbonize while leading the industry in investments in affordable, reliable and sustainable power generation."

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