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INDEPENDENT, INNOVATIVE, RELIABLE TRANSMISSION MANAGEMENT SERVICES FS-LGE-2015-002 Facilities Study Report (Modified) January 22, 2016 Study & Preliminary Report Completed By: LG&E and KU Transmission Report Prepared By: TranServ International, Inc. (ITO) Firm Network Service OASIS # 80661550 TranServ International, Inc. 3660 Technology Drive NE Minneapolis, MN 55418 Phone: 763.205.7080 Louisville Gas & Electric/Kentucky Utilities FS-LGE-2015-002 Facilities Study Report January 2016 Page 2 of 7 Legal Notice Neither TranServ International, Inc. (TranServ), nor Louisville Gas & Electric Company /Kentucky Utilities Company (LG&E and KU) nor any person acting on or in the behalf, makes any warranty, expressed or implied, with respect to the use of any information or methods disclosed in this document, or assumes any liability with respect to the use of any information or methods disclosed in this Report. Recipients of this Report release TranServ and LG&E and KU from any liability for direct, indirect, consequential, or special loss or damage whether arising in contract, warranty, express or implied, tort or otherwise, and regardless of fault, negligence and/or strict liability. Louisville Gas & Electric/Kentucky Utilities FS-LGE-2015-002 Facilities Study Report January 2016 Page 3 of 7 1. Executive Summary A Facilities Study was performed by LG&E and KU for the following request: Table 1 Request Details Assign Ref POR POD MW TS Increment TS Type Request Type Start Time Stop Time Q-Time 80661550 LGEE LGEE 34 YEARLY NETWORK ORIGINAL 2015-05-31 23:00:00 CS 2017-12-31 23:00:00 CS 2015-01-02 10:08:09 CS TranServ as Independent Transmission Organization (ITO) completed a Transmission Service Request (TSR) System Impact Study (SIS). This study identified constraints to providing the requested service that resulted in the need for both direct assignment facilities and network upgrades. Therefore, the Facilities Study Agreement was issued. The LG&E and KU Open Access Transmission Tariff (OATT) states that the Facilities Study will include a good faith estimate of (i) the cost of Direct Assignment Facilities to be charged to the Eligible Customer, (ii) the Eligible Customer’s appropriate share of the cost of any Network Upgrades, and (iii) the time required to complete such construction and initiate the requested service. LG&E and KU Transmission initially performed a Facilities Study for the subject request that was submitted to the customer in July 2015. After review of the Facilities Study report the customer recommended an alternate solution to mitigation of the identified constraints. In accordance with 19.6 of the OATT, the Facility study was reopened. This report details the required new Facilities and Facilities upgrades identified through evaluation of the proposed option. TranServ has reviewed the Facilities Study results and draft Facilities Study Report from LG&E and KU and prepared this final report in accordance with the LG&E and KU OATT. Louisville Gas & Electric/Kentucky Utilities FS-LGE-2015-002 Facilities Study Report January 2016 Page 4 of 7 2. Facilities Study Results from LG&E and KU TranServ completed a TSR SIS and identified the following thermal and voltage constraints in Table 2-1 for providing the requested transmission service for the subject request. LG&E and KU performed a Facilities Study and determined that mitigation of the thermal and voltage constraints can be achieved through installation of direct assignment facilities and network upgrades. Table 2-1 Mitigation Needed By Facility to Mitigate CORYDON 69 TO HILAND M 69 2015S 1025:TRMCLFROCJEF 2015S RIVRVW COAL 2015W MORGNFLD OVRL N T 2016S 69.000 TO 69.000 1 OVRL N T 69.000 TO RVRVW CL TP 69.000 1 RIVRVW COAL 69.000 TO RVRVW CL TP 69.000 1 MORGNFLD 69.000 TO OVER S T 69.000 1 DIXON 69.000 TO NEBO 69.000 1 HILAND M OVER S T 69.000 TO 69.000 1 2016S 2017S 2017S 2017S 2017S OVRLND N 2017S OVRL N T 2017S OVRLND N 2017S RVRVW CL TP 2017S UNIONTWN 2017S ASHYBURG 2018S ADVENT MINE 2019S ONTON 2019S ASHBY EL 2020S SEBREE 2020S 2834:WILMATGRVWIL 2020S DODGE HL 2023S STURGIS 2023S POOLE 2024S Louisville Gas & Electric/Kentucky Utilities FS-LGE-2015-002 Facilities Study Report January 2016 Page 5 of 7 2.1 Direct Assignment Facilities There are direct assignment facilities required at Morganfield to accommodate the installation of a 69 kV radial circuit from the delivery point to Morganfield substation. Table 2-2 breaks down the required projects, and provides cost estimates and anticipated inservice dates: Table 2-2 Cost ($k) Anticipated In-Service Date Install a 69 kV exit at Morganfield for the new line (radial 69). 434 5/2017 Install 69 kV metering for the Riverview Coal load. 350 5/2017 Relocation of existing 69 kV and 161 kV lines to accommodate new 69 kV radial. 500 5/2017 Construction The cost estimate for direct assignment facilities is $1,284,000 USD. 2.2 Network Upgrades TranServ completed a TSR SIS and identified thermal and voltage constraints for providing the requested transmission service for the subject request. LG&E and KU performed a Facilities Study and determined that mitigation of the thermal and voltage constraints can be achieved through installation of network upgrades in combination with the direct assignment facilities discussed in the section above. Table 2-4 breaks down the facilities which can be mitigated through network upgrades. The numbers in the Mitigation column correspond to the project descriptions in Table 2-5. Table 2-5 also includes the cost estimate for each mitigation and the anticipated in-service date. Table 2-4 Mitigation Needed By Mitigation 2015S 1 1025:TRMCLFROCJEF 2015S 4 RIVRVW COAL 2015W 2 2016S 2 2016S 2 RIVRVW COAL 69.000 TO RVRVW CL TP 69.000 1 2017S 2 MORGNFLD 2017S 1 2017S 1 2017S 1 Facility to Mitigate CORYDON 69 TO HILAND M MORGNFLD OVRL N T DIXON HILAND M 1 69 69.000 TO OVRL N T 69.000 1 69.000 TO RVRVW CL TP 69.000 1 69.000 TO OVER S T 69.000 TO NEBO 69.000 1 69.000 1 69.000 TO OVER S T 69.000 Louisville Gas & Electric/Kentucky Utilities FS-LGE-2015-002 Facilities Study Report January 2016 Facility to Mitigate Page 6 of 7 Mitigation Needed By Mitigation OVRLND N 2017S OVRL N T 2017S OVRLND N 2017S RVRVW CL TP 2017S UNIONTWN 2017S ASHYBURG 2018S ADVENT MINE 2019S ONTON 2019S ASHBY EL 2020S SEBREE 2020S 2834:WILMATGRVWIL 2020S 5 DODGE HL 2023S 1 STURGIS 2023S 1 POOLE 2024S 1 1 3 Table 2-5 Mitigation 1 A. Install high side breaker on existing Morganfield 161/69 kV transformer. B. Install second Morganfield 161/69 kV transformer. 2 Mitigation is achieved through 69 kV distribution radial 3 Install capacitor bank near Ashbyburg 4 Existing operating guide. 5 Two year acceleration of an existing project. Total: Cost ($k) Anticipated InService Date 6,014 A. 05/2016 B. 05/2017 0 05/2017 450 05/2017 0 N/A 0.422* 05/2020 6,464.42 *Total cost of the project is estimate to be $4,500 USD. The cost of the two year advancement is estimated to be $422 USD. The total cost estimate for network upgrades is $6,464,420 USD. The Transmission Customer’s share of the Network Upgrades cost is $0 USD. 2.3 Project Completion Timeframes The time frame required for Engineering, Procurement, and Construction of the necessary facilities is provided in the Tables 2-2 and 2-4 above. It is anticipated that the majority of the initial projects will not be completed until 2017, which is beyond the 2015 and 2016 need dates discussed above. The Transmission Customer’s load is currently served from a radial, which eliminates the possibility of an operating guide. As such, the maximum load that can be served at Louisville Gas & Electric/Kentucky Utilities FS-LGE-2015-002 Facilities Study Report January 2016 Page 7 of 7 the Transmission Customer’s existing delivery point is approximately 31 MW (98% power factor) during the interim period. This load level was tested assuming that the breaker on the high side of the Morganfield 161/69 kV transformer could be in place prior to Summer 2016.