Long Term Energy Plan 2016 …

Long Term Energy Plan 2016

 

EBR 012-8840

 

Comments submitted December 14, 2016

 

It should be a given that all energy projects should be awarded contracts based on sound social, financial and environmental considerations, not by ministerial directives.

 

SOCIAL CONSIDERATIONS - COMMUNITY ENGAGEMENT

 

Recommendations:

 

1. Any energy project MUST have the support of the community being asked to host it.  Support by any other groups, including First Nations, should not supersede the wishes of the local community and should not be used in the ranking of proposed projects.

 

2. Community support should consist of ALL adjacent landowners to project infrastructure, 75% of all residents with the project area, and 50% of all residents within 2 km of the project boundaries.

 

3. If the government wishes to encourage participation by First Nations groups, it could grant tax incentives,  providing funding options, etc., to these groups.

 

4. Revise the community engagement process to prohibit any “cash for support” schemes.  This often places the elected community representatives in a conflict of interest and at odds with a majority of the residents.  It is insulting for elected community representatives to hear energy project proponents state they will receive funds if they support their project, but if the project is approved without their statement of support, they will get nothing.  At least one rural mayor has called this practice “extortion”.

 

EVALUATING AND RANKING ENERGY PROJECTS

 

Energy Minister Thibeault recently commented during a speech given at the Empire Club that future energy contracts would not have quotas based on the type of technology and would be awarded based on cost.

 

Recommendations:

 

This should not be limited to the commodity price quoted by the proponents, but must include ALL costs, both direct and indirect.  The indirect costs include:

 

1. the ability, or inability to deliver electricity during peak hours.

 

2. ALL costs of curtailment that the project in question will generate

 

3. Loses incurred from the export of surplus electricity.

 

4. Costs incurred for any required backup generation.

 

5. Costs incurred for any additional transmission line construction or expansion.

 

ABILITY TO DELIVER ON-PEAK VS OFF-PEAK

 

Commentary:

 

Hydro and nuclear are able to deliver 80 to 90 % of their nameplate capacity and are not weather dependant as wind and solar.

 

Wind projects typically are able to deliver about 30% to 40% of their nameplate capacity due to the availability of suitable wind conditions.

 

In addition to the nameplate capacity, wind energy is often out-of-phase with demand; wrong time of day, wrong time of year.  In their 18 month forecast published in October 2015, the IESO has estimated that the installed wind generation capacity will produce about 12.6% of nameplate capacity during the peak summer months June – September.

 

Thus a 100 MW wind project would deliver 30 MW per hour when averaged over a year, but only 12.6 MW per hour during peak summer hours.

 

Recommendations:

 

1. For the purpose of evaluating and ranking the desirability of any new contracts,  the amount of electricity able to be delivered during peak demand AND the amount of electricity that can only be delivered during off-peak demand should be taken into account, with preference to projects with higher peak demand capability.

 

2. Only non-intermittent sources should be considered for base load requirements.

 

3. Any new projects producing electricity during times of surplus base load should be curtailed without compensation for the “potential” electricity to the project owners.

 

4. The output of existing projects that have contracts requiring the IESO to accept their output during times when all requirements, including those of the North America Electric Reliability Corporation and the Northeast Power Coordinating Council Inc. can met with base load generating capacity from nuclear and hydro, should be taxed to cover the difference between the price paid to the generator and the price the surplus electricity is sold for. These costs should not be included in the Global Adjustment for the ratepayers, nor should they be a burden on the taxpayers through tax rebate programs.

 

CONSIDERATION FOR THE OTHER COSTS OF CURTAILMENT:

 

Commentary:

 

Since September 2013, the IESO has been able to curtail some wind after reaching an agreement with the wind developers that requires those developers to be compensated for the majority of the curtailment.  This cost is currently included in the Global Adjustment.

 

When wind is accepted into the grid during off-peak hours, the IESO has curtailed nuclear and hydro to give wind its preferential access.  This results in additional costs from nuclear and hydro that are included in the Global Adjustment.

 

Due to the intermittent nature of wind energy, the IESO requires standing reserves of gas generating capacity.  These generators are compensated for their standby hours.

 

Recommendations:

 

For the purpose of evaluating the true cost for wind or solar, all these indirect costs must be included in the cost evaluation:

 

1. The cost paid to wind or solar generators when their output is curtailed to balance the grid.

 

2. The curtailment costs to nuclear and hydro when those sources are curtailed to accommodate wind or solar.

 

CONSIDERATION FOR COSTS INCURRED WHEN STANDBY GENERATION IS REQUIRED

 

Recommendations:

 

1. For the purpose of evaluating new project proposals, the additional costs paid to gas generators on standby for wind or solar should be included in their proposed price.  The IESO has sufficient historical data to determine the amount of backup generation is required.

 

2. If a new energy project requires additional new backup generating capacity, those capital costs should be included into their proposed pricing unless the proponent pays for the full cost.

 

3. If a new energy project requires additional transmission capacity, those capital costs should be included into their proposed pricing unless the proponent pays for the full cost of the additional transmission capacity.

 

OTHER CONSIDERATIONS

 

Recommendations:

 

1. Environmental considerations must be evaluated based on the full life cycle for projects under consideration.

 

2. Environmental considerations must include the carbon footprint of manufacturing the components, including offshore, used in the equipment, as well as any costs for the decommissioning and disposal of components, such as wind turbine blades and solar panels, at the end of their life cycle.

 

3. For wind turbines that are direct drive requiring the use of rare earth magnets, the extensive damage to air and groundwater quality from the extraction and processing due to a lack of adequate environmental controls in China should also be an environmental consideration.

 

4. For proposed projects, the carbon footprint of the backup gas generators, if required, should be included as part of their carbon footprint.  The Ontario Society of Professional Engineers has produced yearly assessments for the amount of carbon emissions produced by the renewable/gas hybrid generation.

 

5. The IESO should establish a hierarchy of generator sources with nuclear and hydro running at their full available capacity without any curtailment. This should be followed by any available renewables, followed last by natural gas generation.

 

6. The new tunnel at Niagara, built at a cost of $1.5 Billion, should actually be used to increase the hydro generation.

 

7. For new energy projects, priority should be given to hydro and nuclear sources; both are non-intermittent, and do not require back up gas generation.

 

[Original Comment ID: 206866]