- Published: January 09, 2013
Industry and state and community leaders located in the oil and gas Bakken Formation within the Williston Basin in eastern Montana and western North Dakota are strategizing how to accommodate the projected 208 percent increase in electrical demand needed through 2032. The findings are found in the Williston Basin Oil and Gas Related Electrical Load GrowthForecast (PF 12) study, a 20-year forecast of electric power needs for three regions in the Williston Basin that spanned 43 counties in North Dakota, South Dakota and Montana. TheNorth Dakota Transmission Authority (NDTA) partnered with two regional electricity providers,Basin Electric Power Cooperative (Basin Electric) and Montana-Dakota Utilities, Co, (MDU) employed KLJ to facilitate a power forecast study, which would assist utilities and three states in electrical infrastructure assessment and planning.
Recent improvements in hydraulic fracturing and horizontal drilling technologies have led to an unprecedented growth in oil and gas development and escalated North Dakota to the second top producing state of crude oil in the United States. A correlated effect of localized increases of electricity required to power new wells and related infrastructure is helping industry experts and state and community leaders plan for the continued future growth.
The rapid increase in electrical demand can create complications for electric utility forecasting methods, as a typical power forecasts involves analyzing historic usage trends through econometric methods – a mathematical process that is easily skewed with any sudden and drastic changes to an average demand. Because the recent development occurring in the Williston Basin is a non-traditional resource play – as opposed to a traditional trap-play – a comparable history of electrical load growth does not yet exist.
The study required intense coordination across a variety of sources to address an extremely complex matrix of criteria, including factors associated with employment, population, housing, oil and gas infrastructure build-out; local, regional and global factors affecting oil and gas development; as well as political aspects and regulatory constraints. KLJ completed the study with assistance from the University of North Dakota Department of Petroleum Engineering andNorth Dakota State University Department of Agribusiness and Applied Economics.
To gather analytical information related to the oil and gas industry, KLJ facilitated high-level interviews with stakeholders associated with the development of the Williston Basin’s oil and gas resources. Research and assumptions generated from the stakeholder interviews were validated through industry experts, government officials, Basin Electric, MDU and the North Dakota Transmission Authority.
Following validation, KLJ used the factors to develop a modeling process to forecast the electrical demand, which involved combining spreadsheet calculations with GIS spatial analysisin order to allocate year-by-year demand within the study region for each of the 43 counties over the 20-year study period (2012-2032). The GIS-based modeling process allocated the total demand per square mile for three scenarios—a high amount of development, a consensus (or expected) amount of development and a low amount of development.
KLJ’s study results projected a 208 percent increase in electrical demand through 2032. Specifically for North Dakota, the forecast indicated electrical demand would reach 3,030 megawatts (MW) by 2032, nearly tripling current demand. Additionally, the study incorporated forecasts related to employment, population growth and housing demand correlated to the study area. The study validates and supports growth opportunities and significant investment needed by each of the three states, as well as provides a benchmark for public and private electric companies, who often must substantiate investments to lenders and shareholders.
Since publication, the study has not only validated several parallel reports such as the Upper Great Plains Transportation Institute, North Dakota State University–An Assessment of County and Local Road Infrastructure Needs in North Dakota transportation; North Dakota Housing Finance Agency’s Statewide Housing Needs Assessment; and the North Dakota Pipeline Authority’s Natural Gas Study, but due to the wide range of modeling factors incorporated into the modeling process, will be providing valuable information as the Williston Basin region continues to grow. The PF 12 report is currently used as a 20-year planning tool, and is utilized by cities, towns, legislators and industry to plan for current and future power requirements and infrastructure development within the Williston Basin.