Scenario Development Overview1

Background

In 2010, WECC initiated its first-ever scenario development process, funded primarily by a grant from the U.S. Department of Energy. This effort established a context for long-term (20 years in the future) reliability assessment process at WECC. This paper provides an overview of the scenario development process and its role in WECC’s reliability assessment process.

What Are “Scenarios?”

The term “scenarios” can mean many things to many people. In this context, the term refers to descriptions of plausible futures of the Western Interconnection 20 years in the future. Importantly, scenarios are not predictions—no one can predict accurately what the future will be, especially as far as 20 years in the future. Scenarios are:

  • Stories about tomorrow that help us make better decisions today;
  • Narratives that stretch thinking, but are always plausible and logical;
  • A range of possibilities about the future—not predictions; and
  • A framework for recognizing and adapting to change over time—ahead of time.

Why Does WECC Use Scenarios?

Scenarios help to manage uncertainty, especially over the long term by identifying strategic choices that need to be made along the way. Scenarios also are based on the participation of diverse stakeholders and dovetail with WECC’s modeling processes. By establishing the context for long-term reliability assessments, scenarios provide the first step leading to an integrated study program.

How Does the Scenario Development Process Work?

WECC’s scenario development process follows seven foundational steps:

  1. Define the focus question. The focus question is a clear question about the area of the future that WECC would like to understand. For WECC scenarios, the focus question will likely be related to developments in electricity infrastructure and markets that impact electric reliability. The intent of the question is to organize the thinking of the group and set a clear focus on which subject matters are important and relevant.
  2. Identify key scenario drivers. These are factors and issues that are expected to influence the course of electricity infrastructure and markets and can include areas such as technological innovation, economic growth, policy development, environmental issues and fuel prices.
  3. Create a scenario matrix. The stakeholders developing the scenarios define two drivers that are both extremely important and different from each other to define the axes of a matrix. The quadrants of the matrix, in turn, describe four possible futures that include high and low values of each axis.
  4. Create scenario narratives. Once the four futures are described generally, the stakeholders develop “stories” about how each future could come to pass. Here, too, it is important to recognize that the stories are not predictions. But, they must describe a plausible series of events, starting from the present, that leads to each plausible future.
  5. Model each scenario. There are no set rules for how scenarios are modeled to understand their impacts on the BES. WECC has used existing tools, such as capital expansion, production cost and power flow models, to understand potential impacts of scenarios on the BES.
  6. Review and interpret modeling results. By analyzing the results of modeling activities, WECC and its stakeholders can better understand potential reliability risks related to each scenario.
  7. Identify and follow early indicators. These are events and activities that, if they occur, could indicate progress toward one of the future scenarios. By tracking early indicators, decision-makers will understand strategic choices that will guide future infrastructure development, identify potential reliability risks and suggest possible risk mitigations.

What Are the Next Steps?

WECC’s current scenarios have led to a series of analyses and reports in 2013 and another set of reliability analyses in 2017. In 2018, WECC will work with its stakeholders to develop new scenarios based on current needs, drivers and trends. The new scenarios will establish the context for reliability analyses over the next five-to-ten years.

Western Electricity Coordinating Council