Comments on ERO Number 019…

Comments on ERO Number 019-7853 – Ontario Regulation 429/04 Amendments Related to the Treatment of Corporate Power Purchase Agreements.

The City of Ottawa is interested in the opportunity presented by these prospective amendments which will give scope for affordable and innovative clean energy generation. The City’s energy and emissions transition strategy, Energy Evolution, was unanimously passed by Ottawa City Council in October 2020. The strategy includes a model with 35 actions which both the corporation of the City of Ottawa and the community at large need to meet Council approved greenhouse gas emission reduction targets and ensure that Ottawa is doing its part limit global temperature increase to 1.5 C. As clean electricity is a key aspect of this strategy, we see a direct link between our strategy and prospective amendments that would accelerate the growth of new clean electricity generation in the province.

The City of Ottawa notes that the proposal detail discussed ‘qualifying ICI participants’ suggesting that not all Class A customers will be eligible. Most class A customers are embedded and are currently not market participants; we anticipate this results in a small pool of customers as there are only 92 customers who are currently market participants in Ontario. For example, all of the City of Ottawa’s 19 Class A accounts are embedded and connected to the distribution system, and we currently have no plans for a non-embedded Class A account that is attached to the transmission system. The Ministry of Energy may be considering starting off small by not including embedded Class A customers. While a gradual approach is understandable, including some embedded Class A customers could present opportunities. These could relate to learning how embedded customers approach this initiative, opportunities to source more energy in an affordable way, and the ability to further reduce bulk system capacity demands while sourcing clean energy in Ontario.

Relating this to a municipal context, we recommend this program include municipally controlled embedded Class A accounts. This would be advantageous because it is a potential avenue for municipalities to cut energy costs in rate supported services such as water and sewer and electrified transit services which are currently struggling financially as well as tax supported services such as recreation facilities or an electrified municipal fleet. This will give municipalities opportunities to affordably work towards their climate goals.

More broadly, inclusion of embedded municipal Class A accounts will have general benefits. Municipal class A accounts tend to be close to load centres and their inclusion will give scope for generation close to existing load. In terms of program development, municipalities would be well positioned to relate their experience in this prospective program back to the Ministry of Energy so that adjustments and possible program expansions could be undertaken. Looking further ahead, learnings from this type of credit transfer may eventually be useful in other electrical account classes.

Finally, the City of Ottawa notes that types of generation discussed include wind, solar, hydro, energy storage, and biofuels. The Energy Evolution model contemplates wind, solar and hydro generation as well as electricity storage. The use of green hydrogen for electricity generation is compatible with our model while the use of biofuels in electricity generation is not. The model assumes that biofuels have a limited supply that are better applied in other sectors such as heating, transportation and industry and must be therefore used very sparingly in electricity generation.

Overall, the City of Ottawa is very pleased to see these prospective amendments come forward. The City of Ottawa thanks the Ministry of Energy for this opportunity to comment and would be pleased to discuss this further.