Cold Air

Ford government contracts new solar (and wind) generators

2026-04-10T08:09:00.002-04:00

Yesterday Ontario’s electricity system operator (IESO) announced its first procurement of grid-scale solar, and wind, generators in over a decade. The reported average price of $87.80 per megawatt-hour is presented as attractive in a historical context, but analysis reveals a far different trend for wind and solar within Ontario.

The government’s press release following the IESO publishing results of its “Long-Term 2 Energy Supply (Window 1)” procurement (LT2) includes:
Unlike the former government, Ontario is following the Auditor General’s recommendation on competitive procurements resulting in a 73 per cent cost reduction for ratepayers when compared to the previous Feed-in-Tariff contracts and 21 per cent lower than the Large Renewable Procurement (LRP). These results have proven more affordable than similar procurements in comparable jurisdictions across North America…
There’s a few reasons to wince at this boasting. Regarding pricing across places and time, it is not unimportant that the federal government introduced Investment Tax Credits (ITCs) and Accelerated Capital Cost Allowances (ACCAs), benefiting the latest pricing. More notably, if the results are 73% below the awful Feed-in-Tariff (FIT) contracts of 16ish years ago, but only 21% below the LRP of a decade ago, that’s a pretty good indication the previous Wynne government had acted on pricing.

Shortly after achieving power the current governing party, under Premier Doug Ford, cancelled the contracts from the previous government’s last procurement (LRP-Large Renewable Procurement). From the March 2016 announcement of the LRP results:

five wind contracts totalling 299.5 MW, with a weighted average price of 8.59 cents/kWh;
seven solar contracts totalling 139.885 MW, with a weighted average price of 15.67 cents/kWh; and
four hydroelectric contracts totalling 15.5 MW, with a weighted average price of 17.59 cents/kWh.

Yesterday’s announced price is 8.78 cents/kWh, which is quite similar to 8.59 cents/kWh: although they come a decade apart, and there is a time-value adjustment that ought to be made, there is also the increase in federal incentives for project developers. Wind pricing is little changed.

Whatever the government wants: The only explanation for Ontario electricity costs in Premier Ford’s 3rd term

2026-02-19T17:09:00.002-05:00

I hastily posted some nasty thoughts on X today after looking up an obscure “Final RPP Variance Settlement Amount”. It will take some work to explain what that is, and why it affirmed my worst thoughts of some people in current government and the formerly public service areas of the energy regulator (OEB), and perhaps the electricity system operator (IESO).

Here’s the OEB’s description of the RPP Variance Settlement amount (the amount):

This amount will reflect the consumer’s share of any accumulated variance between the actual price paid to generators and the forecast price paid by RPP consumers. If consumers have been paying more for electricity than was paid to generators, this amount will be a credit. If consumers have been paying less, it will be a charge.

The best I can do to estimate and evaluate the amount posted on February 18, 2026 is to use figures for January. To use the OEB’s method: If the $128/MWh regulated price plan is more than the average of approximately $98/MWh class B commodity rate for the month, there is a credit.

There is not a credit: there is an increase of $343 million.

The timeframes don’t line up and it’s only one month: but applying my estimation method and the OEP’s reported amounts back to 2000, it is a month that is exceptional in a way my most cynical self anticipated. For the statistically inclined, the average difference between my method’s estimates and the OEB’s reported variance change was a little under $6 million prior to yesterday, but the standard deviation was about $75 million – which indicates the expected inability to line up timeframes but most months the moves are directionally the same, and larger deviations correct in the following months. This monthly the difference in my estimate is $545 million, breaking the previous record of $211 million in what is a 4-sigma event; probability of which is 1 in 15,787.

But I expected something like this.

Much ado about Ontario’s new export charge on electricity

2025-03-11T14:30:00.002-04:00

Ontario’s Ford government directed the electricity system operation (IESO) to begin levying a $10/MWh ‘surcharge’ on electricity exports to the United States. The official news release states that, “At this level, the surcharge will generate revenue of $300,000 to $400,000 per day, which will be used to support Ontario workers, families and businesses.” All other factors holding unhanged, that would be true, but the other factors involved in Ontario’s electricity pricing make it extremely unlikely that the move will generate any revenue.

Ontario’s electricity exports have relatively recently become dominated by supply from natural gas generators, unlike the exports over the previous decade which were driven by an excess of committed, trivial-emission, supply from nuclear, hydro, wind and solar. One way the switch is visible is in the increased average cost of exports. The simplest measure of costs is the Hourly Ontario Energy Price (HOEP). The average HOEP for exports to the US over the past 3 years isn’t quite $40/MWh, but it’s close enough that the government can excused for using a $10/MWh surcharge to carry out a threat of a 25% increase.

simple rubbish told around the world: an anti-nuclear data story

2025-01-13T15:49:00.002-05:00

Australian energy policy personality Simon Holmes à Court posted to X, “the simple fact is *every* new nuclear power project in ontario’s history went way over budget.” I think ‘fact’ needs to be examined. The facts in his post are a distortion of what was, for the most part, delivered much more truthfully 37 years ago.

In Ontario this month the Canadian Nuclear Safety Commission (CNSC) is holding public hearings on an application by Ontario Power Generation (OPG, the public generator), “for a licence to construct one BWRX-300 reactor at the Darlington New Nuclear Project Site (DNNP).” Regulator hearings are an income opportunity for groups permitted to act as intervenors. The anti-nuclear Ontario Clean Air Alliance (OCAA) is one such intervenor, and it is from their presentation at the hearing relayed to Australia as “simple fact.”

Many online quickly observed an issue with this table in its disregard of real values in adjusting currency values for time. I will explore that after checking the data sources noted in footnotes.

on building nuclear to create hydrogen

2024-09-25T14:35:00.000-04:00

The head of the IESO, the operator of Ontario’s electricity system, recently delivered a speech at an event organized by both the Ontario Energy Association and the Association of power Producers of Ontario (APPrO). I read the notes as it’s always interesting when the contractor speaks to the potentially contracted. Being a nuclear advocate this jumped out at me:

“We continue to work with Bruce Power and Ontario Power Generation to assess the feasibility for 17,800 MW of new nuclear in the province – consistent with our Pathways to Decarbonization report”

As a nuclear advocate, and a consumer advocate, and as a commentator whose supply mix suggestions following a procurement orgy from 2009-2011 closely match where we ended up today, I felt obliged to follow up. It’s not feasible, but it is fashionably ridiculous.

The Pathways to Decarbonization is a report delivered by the IESO to the Ministry of Energy, at the request of the Minister, intended to, “evaluate a moratorium on new natural gas generation in Ontario and to develop a pathway to zero emissions in the electricity sector.” I didn’t pay much attention because I think those are facile topics, but seeing it cited as a reason for 2-3 times more nuclear, it was now worth ctrl f’ing the document.

There’s some lovely bar charts, with related data tables, displaying capacity that exists and is planned to still be operating in 2050, along with new capacity needed and the totals for both. The figure for capacity includes the 17,800 MW “New Capacity Online by 2050.” What slowed my enthusiasm was the energy number expected from this 17,800 MW: 63 TWh.

That’s very low. Upon checking, the only years of nuclear output below that level, since 1985, came when we’d deliberately idled the 5,000 MW of capacity a Pickering A and Bruce A (1998-2003), which would have put active capacity around 8,200 MW , so getting that same level of output out of 17,800 MW seemed a mistake. Unfortunately, it’s a little worse than that.

This presentation of the data lacks context for those not aware of today’s actual supply, but compared to now this is roughly doubling solar, imports and nuclear (not adjusted for the decreased real capacity due to refurbishment), and nearly tripling wind. Gas is disposed of and replaced, in its capacity role, largely with hydrogen.

Where, oh where, will we get the hydrogen?

Will the new version of Ontario Energy Minister prove to be Smitherman 2.0?

2024-09-07T10:36:00.003-04:00

"Minister Lecce needs to step back and gain knowledge on the existing costs to us Ontarians of our electricity needs instead of charging ahead..." -Parker Gallant

Parker and I have been communicating on Ontario’s electricity sector for over 13 years. We both started due to the wreckage of a brash new minister casting aside the policy of a professional planners to boldly undertake a new direction intended to make Ontario a leader in wind and solar energy. Back in 2009 an Integrated Power System Plan (IPSP) was cast aside and a directive from a freshman Energy Minister, and trusted Deputy Premier, signed an enormous 2,500 MW deal with a Korean consortium that was supposed to kick off the rush to 10,700 MW of non-hydro renewables. There is not, anything certain I wish to communicate today, but I have collected and formatted data throughout, so I thought I’d collect a number of the graphics and data sources I’ve been using on social media to communicate the concerns I have about returning to a GEA-era procurement debacle.

“With energy demand growing rapidly, our government is stepping up by advancing our largest energy procurement in our history.” -Stephen Lecce, Minister of Energy and Electrification [emphasis added]

I don’t generally focus on semantics, but “energy” is used very poorly in Lecce’s communication. Let’s look for “growing rapidly” in annual electricity supply in Ontario over the past 88 years.

Ford Channels McGuinty in directives to new Energy Minister

2024-07-31T10:26:00.001-04:00

Ontario recently swapped Energy and Education Ministers. Early comments from the new Minister of Energy (and Electrification), Stephen Lecce, indicate a type of student we see far too often in the fields of environment and energy; one willing to take direction without putting much thought, or study, into them. Of particular concern are comments on exporting power. In a recent interview[1] Lecce describes ‘three key priorities” in his “marching orders” from the Premier. Presumably the current Premier, Doug Ford, but maybe not.

First, we are absolutely committed to ensuring an affordable electricity system for families, seniors and small businesses.
Second is the expansion of clean-energy generation for the people of Ontario. We already have one of the cleanest grids on the continent. The vision is to continue to generate more as our population increases, our industry expands and our manufacturing electrifies.
Third is to help build out Ontario as a clean-energy superpower, able to export our energy – as we already do. We’re already a net exporter to New York and other places. We want to strengthen our clean-energy advantage and export technology and electricity around the world, particularly in the United States. [emphasis added]

I have long-standing concerns about exports.My first blog post to garner significant attention, and spur mainstream stories bringing comments from then Premier Dalton McGuinty, reported on the high exports and negative pricing of January 1st, 2011. “A full decade later I was still writing estimates on losses incurred on exporting electricity, which grew rapidly along with the growth in supply spurred by McGuinty’s Green Energy Act. This post is going to build off of another discussion on losses on exports in the context of “affordable electricity for families”, using a presentation I’ve added to reporting built on basic data shared from the system operator (IESO)..

screen capture from Power BI reporting

Anti-Nuclear by necessity

2024-02-12T11:26:00.003-05:00

On January 30th the government of Ontario, currently headed by Doug Ford, announced it was advancing the refurbishment of the four “B” reactors at the Pickering Nuclear Generation Station (PNGS), Initial media response has been largely positive, with Ontario’s public broadcaster (TVO) noting, “ it’s hard to see a future government changing course”. Apparently TVO, and other news outlets, felt compelled to offer their readers articles opposed to the refurbishment for balance. At TVO the negative response came shortly after the news broke in an article by Taylor C. Noakes. Rebutting that work is one goal of this one, but it may be more important to explore the emerging tools for producing an article to counter a narrative in another.

There is a commendable aspect of TVO attaining the work by Noakes, who I believe to be ‘stringer’ - which is an independent producer of content: Noakes has produced multiple articles for, at least, TVO and Desmog, on a wide variety of topics. If you wanted an article with a perspective, Noakes is exactly the type of person you’d go to - particularly, if you’re familiar with Desmog and want an anti-nuclear position. The most obvious alternative approach, and the one taken by The Globe and Mail, is to publish an op-ed from a career antinuclear personality. Mark Winfield’s The folly of Ontario’s nuclear power play (subscription) is exactly what you’d expect from a person with a career based on opposing nuclear - I’ve previously highlighted his mid-2000’s publication at Pembina that planned for a nuclear-free Ontario by 2020 that would have had electricity-sector emissions 400% higher, and will simply emphasize that his status as an expert relies not on the the wisdom in his past work, but simply in his opposition to nuclear power.

Noakes’ stringer work may be enhanced with the emergence of Artificial Intelligence (AI) tools. Given a topic a writer can simply use an AI tool such as that embedded with the Bing browser, or OpenAI’s tools (I tested only the free version), and get the skeleton of an article. Bing’s Co-pilot, responding to my prompting, “argument to oppose refurbishment of Pickering nuclear generating station”, produced bullet points supporting 5 themes: Environmental Concerns, Cost and Overruns, Safety and Aging Infrastructure, Changing Energy Landscape, and Public Consultation and Transparency. ChatGPT gave paragraphs supporting 7 possibilities for opposing: Cost, Safety Concerns, Environmental Impact, Technological Obsolescence, Public health, Opportunity cost and Community opposition. These themes do emerge with every announcement of continued nuclear operations.

To acquire an article opposing nuclear power in 2024 a polymath isn’t required, but mostly somebody who can wrap readily attainable content in a story. Noakes’ TVO story is titled:

The Ford government’s decision on nuclear will set Ontario back 30 years
OPINION: Our politicians keep subsidizing old technologies and industries — and putting opportunity and ideology ahead of basic economics

That sets the stage: a villain is presented (Ford, who heads what is actually Ontario’s government - but Ontario can’t be the villain), driven by ideology instead of rationality (a.k.a. ‘Basic economics’). You can almost hear a pantomime’s audience booing the modern “not following the science” villain..

Read more »

Opportunities and Obstacles for nuclear in Alberta

2023-08-09T12:31:00.001-04:00

The prospects for new nuclear reactors has been a hot topic this summer, particularly following Ontario’s announcements exploring new builds of large reactors and additional consideration of smaller (modular) reactors (SMRs). Ontario had been exploring SMR’s with other provinces, initially with New Brunswick and Saskatchewan, and more recently Alberta joined the group. Alberta’s electricity mix last week became a second hot topic. The current Canadian government is also a topic as it threatens to force, "a net-zero electricity system by 2035."

This seems an appropriate time for me to revisit Alberta’s electricity system in search of a route to nuclear power in that province.

Alberta’s electricity system underwent radical changes since I wrote on a former government’s activities in 2017’s Alberta.Bound. In this post I’ll concentrate on data from the Alberta Electricity System Operator (AESO) in this post, mostly from their Annual Market Statistics data visualization which currently contains data from 2015 thru to June 2023. The AESO's data indicates rapidly declining potential for nuclear in the AESO’s market in recent years.

Alberta’s coal generators saw the wish for them to disappear grow for over a decade. In 2012 I wrote on the rapid opposition to federal regulations that would see emissions from new coal-power plants limited to something impossible with any operational technology, and a maximum lifespan of 50-years mandated, then, through emissions regulation, the goalpost essentially moved to 40 years within Alberta, and then a 2030 death data was mandated, and other generation sources incented. Alberta's Climate Leadership Plan (CLP) of 2017 noted the, "drive toward the development of 30 per cent of electricity generation capacity from renewable sources connected to the grid by 2030." [emphasis added] While the CLP itself spoke of efforts to remove, "policy barriers of the conversion of coal units to natural gas," many of the people that set policy had already created an understanding that ,"Two-thirds of the coal-generating capacity (4200 MW) will be replaced by renewable energy, and one-third (2100 MW) by natural gas."

Summarizing the changes in generation capacity since 2016 by grouping fossil fueled generators together (gas, coal, dual fuel), “green” together (wind, solar and storage), displaying co-generation alone and lumping everything else in under “other” (including hydro), the decline in generating capacity of firm generators fueled by coal and/or gas is apparent, as is the, related, meteoric rise of “green” ones.

on the risk of power shortages in Ontario this summer

2023-06-06T17:11:00.003-04:00

A regulatory body with a mission “to assure the effective and efficient reduction of risks to the reliability and security of the grid,” delivered its “Summer Reliability Assessment” for North American jurisdictions last month. The brief news release for the document:

warns that two-thirds of North America is at risk of energy shortfalls this summer during periods of extreme demand. While there are no high-risk areas in this year’s assessment, the number of areas identified as being at elevated risk has increased. The assessment finds that, while resources are adequate for normal summer peak demand, if summer temperatures spike, seven areas — the U.S. West, SPP and MISO, ERCOT, SERC Central, New England and Ontario — may face supply shortages during higher demand levels.

Toronto Centre MPP, the NDP’s Peter Tabuns, used that document to launch an attack on the government’s management of the electricity system in the Ontario legislature on June 1st:

“…the body that oversees electricity grids in North America reported that Ontario risks power outages this summer. In fact, Ontario is the only province in Canada that is rated with elevated risk that it can’t meet peak demand. After five years, this government’s policies of cutting funding for efficiency and conservation, of demolishing wind farms and cancelling other renewable projects have led to this.”

This has gotten the rabble roused - if the media is any indication. The Toronto Star and CTV news both reported on topic. CTV’s reporting included comments from an expert, who advised, “There really is not any cause to be alarmed”, but also commentary from the opposite sort - politicians Tabuns and the leader of Ontario’s Green party.

Since this topic doesn’t seem to be going away I’ll explain some of the structure and content of reporting on reliability, and address the substance, or lack thereof, in the criticism of the government as reducing reliability through canceling plans for additional ‘green’ energy.

87 years of electricity demand history ought to be relevant for planning

2023-04-30T08:35:00.009-04:00

I’ve assembled a long view of annual Ontario Electricity production and/or consumption, from 1935 to 2022. There should be policy implications to take from the data.

Over 12 years ago I published the first article on my first blog: “The Current and Future State of Electricity, as the [Ontario Clean Energy Benefit (OCEB)] comes to Ontario.” I noted in that work that 2010, “[Seemed] like a good time for a big picture overview…” The OCEB was a 10% reduction of bills to, “help consumers manage rising electricity prices for the next five years.” Twelve and half years later the discount has a different name (Ontario Energy Rebate), and is 11.7%. 2023 strikes me a lot like the period running up to the Green Energy Act, so here’s the long view of Ontario’s demand history as information to protect for a repeat of that heist as we renew interest in procuring new sources to meet future provincial demand..

The graph of demand for the last 88 years contains 4 data sources, none of which are matched precisely to another:

“Porter” refers to the chair of 1980’s “The Report of the Royal Commission on Electric Power Planning”, and specifically data contained in appendix A of Volume 2. The figures shown are cited as originating in “Ontario Hydro’s Power Resources Report No. 790201.” In terms of comparison to other data sources in the graph the notable thing about this is that the figures represent production (not demand), and they’re a partial representation of production as there was electricity generated by entities other than Ontario Hydro.
CANSIM 127-001 is a Statistics Canada monthly dataset built from survey data that existed, at a couple of levels of complexity, from 1957-2007. For purposes of attempting alignment with other data sets, I’ve subtracted from the report’s “Total Available” value the figure shown for “Total Industrial Generation.” Without diving into the exact meaning of the latter field I assume it is self-generated (or behind-the-fence) generation which, while nice to know, is not a component of the other data sets in the chart. It must also be noted “Total Available” includes imports and excludes exports, unlike the “Porter” data
“IESO Demand” is the figure reported by the Independent Electricity System Operator (IESO) as “Ontario Demand” - by which I understand they mean demand for supply from the IESO-controlled Grid (ICG). This differs from CANSIM 127-001 in a couple of ways: it will not capture generation from generators embedded within local distribution companies’ grids but it is data based on data far more reliable that that collected through surveying
“IESO Consumption”is a figure from the calculation of global adjustment charges as that proportional chargeback tool (for costs of supply not recovered through market revenue) requires calculating a consumers usage as a share of all consumers’ usage. As confusing as that sounds, this measure essentially differs from Ontario Demand in that it does capture the impact of distributed generators in supplying demand, although it omits the share of generation that is lost in transmission lines (as does the CANSIM 127-001).

The initial graphic is minorly distorted as Porter misses some generation, the survey data is inherently more prone to error, and at the latter years show the growth of distributed generation as the IESO’s “Demand” diverges from its “Consumption”.Read more »

Nuclear bros and environmentalists

2023-04-05T05:45:00.002-04:00

I'm Scott.

You may know me as a nuclear bro' as I'm male and staunchly support nuclear energy. I need to preface the following as I'm only now publishing work I wrote mostly last summer, slightly edited with some extra paragraphs to complete the work. The motivation to put it out in the wild comes from events over the past couple of days. On a positive note the federal government has shifted to include nuclear in programs aimed at eliminating emissions - perhaps it needs a push to reconstruct the Ministry of the Environment to align it with the new government position and this will provide it. Ignobly the greater motivation comes from reading this interesting Twitter thread from the Patrick Brown associated with the Breakthrough Institute, and the invasion of my Twitter thread with formerly curious and interesting climate commentators/academics who stagnated intellectually a decade ago and now come out mainly to bless the words of other old stale 'environmentalist'.

__________

One benefit I’ve gotten from social media is learning I am hated by some people I’ve never met - or even heard of. It comes when I enter arcane discussions on obscure topics and some viciousness enters from the periphery. I recognize the emotion in the irrational histrionics as I’m not immune to behaving similarly when losing my composure. I empathize with my haters. After viewing profiles to learn something about them I realize they have reason for animosity as they draw income from some pursuit I’ve attacked, repeatedly, in the past. This has worried me - I do know and like some people in fields I am not keen on (such as solar and efficiency), and I think in recent years I’ve worked at remaining civil. Unfortunately, this is now problematic. The same institutions, and people, I railed against over a decade ago in fighting the assault on the Ontario electricity consumers launched by the Green Energy Act, and related feed-in tariffs, are being manipulated in the same way by many of the same people with the same playbook as they perceive a political environment receptive to their same manipulation. If there’s hating to be done, I’m damn well going to be doing it!

What is an environmentalist?

I suggest an environmentalist is somebody considered an environmentalist by others marketed as environmentalists. There’s some requirements for that group to emerge: money, influence/access to media, communication and social skills… cinematographers.

What there hasn’t been is any requirement for accomplishment.

Ontario Residential Electricity Rates are dropping. Bills aren't.

2022-10-22T12:00:00.003-04:00

The Ontario Energy Board (OEB) released Regulated Price Plan (RPP) rates for the next 12 months, and they're down 10% from the current period. Other changes were not as clear from the material published along with the new rates, which I've come to realize is necessary for residential consumers to understand that their bills will change very little. I was waiting to see what the mainstream media would publish regarding the steep, and internationally rather unique, decline in rates, but I've seen nothing - which is somewhat of a blessing given the poverty of understanding demonstrated in recent reporting on Ontario electricity. I'll explain what is happening to rates, why they're dropping for one category of consumer, why it won't change individuals' bills, and the impact on other categories of consumers from recent changes in the so-called market's pricing.

I've added summary columns to the OEB's presentation of rate changes in the following tables, to demonstrate the reduction is rates. For those hoping to find information of which rate plan is best for them I'll point to my work 2 years ago as there's no real change in the mechanics: if your usage is primarily in the lower threshold of the tiered pricing plan, use that plan - if it's mostly in the upper tier, stay with the default time-of-use (TOU) rate plan.

Refurbish Pickering Nuclear Generating Station

2022-05-25T14:53:00.001-04:00

I was approached some time ago about supporting the refurbishment of the Pickering Nuclear Generating Station (PNGS). While I tried to be positive in offering to support proponents with data work, I didn’t add my name to the campaign primarily because, in addition to supporting nuclear, I try to support consumers. Things change, and the argument for a full refurbishment of reactors at PNGS has recently grown much stronger.

When I began this blog back in 2010 I pushed back against increasing electricity supply and the enormous costs unnecessary expansion was having on consumers, despite over half a century of declining growth rates in demand that had become no growth at all. In hindsight this was correct, and consumers benefited from the analysis. While Ontario has been awash in surplus supply for most of the ensuing 12 years, 2010’s desire to contract 10,700 MW of “clean, renewable energy from wind, solar and bioenergy” was never realized and today we have about 3,000 MW less than that under contract. For perspective, 3000 MW of wind at the prices the government in 2010 was contracting would have added about $25 billion in cost to Ontario’s consumers (over 20 years).

‘Renewables’ were not the only supply options being rolled back after 2010-2011. The “Oakville Generating Station” was contracted in 2009 (eventually built as the Napanee Generating Station), and that remains the last procurement initiating a major gas-fired generation station. Ontario Power Generation (OPG) not only abandoned plans for new nuclear builds but also for the refurbishment of the Pickering B, opting instead for life extension options on a far smaller scale.

I’ve long been unenthusiastic about all potential new generation which, in hindsight, was marked by high pricing due to unnecessary contracting, stagnant demand and excess generation. Including nuclear.

I shared my opinion on a supply mix for the province over 11 years ago:

The [Ontario Power Authority] is likely to determine that 8 Bruce units, and 4 Darlington units, will be able to supply 50%, of total electricity generation necessary to meet demand within Ontario… I would suggest the minister revise the wording of the directive to nuclear generation should be targeted to account to meet 50% of Ontario Demand. Looking back on statistics back to 1990, that is the level above which we become major exporters of electricity

During the next Ontario electricity planning cycle, in 2013, I developed planning tools to test different mixes under different assumptions on productivity and pricing. Again I found the most economic lower-emission scenario was the 10,000 megawatts (MW) of refurbished nuclear capacity (comprised of 8 Bruce units and 4 Darlington ones). In one scenario I’d run based on stagnant supply, adding another 2,000 MW of nuclear (roughly the combined capacity of the 4 Pickering B units) reduced gas use, and emissions, but about half the added nuclear would have been wasted, dumped or displacing other trivial emission supply.

A lot has changed for modeling since 2013: I would use much different pricing, I’d have to adjust my expectations of output from industrial wind turbines (they’re bigger and have higher capacity factors), sharply reduce solar pricing, review storage aspects, etc. But the biggest issue would be forecasting demand, and it is there that I’ve been convinced the tide is turning and the long period of stagnant electricity consumption in the province is ending.

Fake news and professional planning

2022-05-11T15:25:00.002-04:00

As somebody who has observed, measured, critiqued and discussed Ontario’s electricity sector for a dozen years I feel compelled to discuss a couple of harmfully poor articles that have recently appeared in Toronto’s sleaziest newspapers.

Retiring Ontario’s natural gas-fired power plants would be cheaper than official estimates released last fall, critics say, adding that they believe the government suppressed the publication of modelled scenarios that would have supported closing the carbon-intensive facilities.

That begins an article that appeared in The Globe and Mail last month, ascribed to a Matthew McClearn who the paper’s website comically describes as, “an investigative reporter and data journalist with The Globe and Mail's Energy, Natural Resources and Environment Team.” McClean’s article, “Documents raise questions about costs to retire Ontario’s natural gas power plants”, quotes a single critic from his “investigation”. That critic is Jack Gibbons.

I’ll admit that Jack Gibbons is a critic. As am I. I’ve also thought of him as a self-promoting snake, but realize now he’s more of a chameleon. In 1998 Gibbons’ “Ontario Clean Air Alliance” (OCAA) was promoting gas as a replacement for coal, as it continued to do even beyond 2009 when Gibbons was advocating for the Oakville (gas-fired) Generating Station - which turned out to be the last major gas-fueled new-build generator contracted in the province. Emissions today are far lower than under any of the scenarios the OCAA lobbied for during it’s first decade-and-a-half of existence and, simply put, when the OCAA called for a gas phase-out it called for something that began while they were advocating for new gas plants. In the past couple of years the aging OCAA members seem to have yearned for the years they received attention and collected ignorant municipal councillors to sign on to a campaign putting an end date on gas-fired generation.

... we recommend that the Government of Ontario take the following actions to achieve: i) a complete gas plant phaseout by 2030; and ii) an interim 2.5 million tonne per year cap on the gas plants’ GHG pollution as soon as possible. - OCAA Feb. 2021

The OCAA gas phase-out campaign steals from the strategies of the McGuinty Liberals in Ontario, who seized the coal phase-out issue as their own in the election of 2003 by promising to end coal 7 years earlier than the other parties planned - which they subsequently didn’t, but still credited for the policy. No new-build gas generator has been initiated with a contract since 2009 in Ontario. The long-term energy plan of 2013 invented a "planned flexibility" category, which had exactly the same attributes as simple cycle gas turbines specifically because it was non palpable by that time. In response to the OCAA campaign to be seen as against what they promoted for well over a decade the Minister of Energy issued a moratorium on procuring what hadn't been procured for the past dozen years.

Ontario Electricity Exports: losses, benefits, and transmission charges

2022-02-19T15:31:00.004-05:00

In 2021 Ontario’s electricity market sold exported electricity for $1.25 billion dollars less than Ontarians paid to have it supplied. That amount is calculated with a methodology I described one year ago. 2021’s $1.25 billion loss is an improvement on 5 of the past 6 years, and $563 million better than we fared in 2020.

Others look at exports differently. Today we visit the murky world of the Ontario Energy Board (OEB) as it deals with a transmission charge for exports - which is where we find the IESO providing expert opinion.

A quick review of my work estimating losses on exports for those who haven’t memorized last year’s article: I copied (or attempted to) the methodology of the Office of the Auditor General in its 2015 annual report, which tallied up total system cost and usage to find an average cost of supply, takes revenues and volumes of exports, and does the math on how much lower the overall cost of exports was at the rate exporters paid than if they’d paid the average rate.

If I had to present a one-sentence hit on that I’d borrow from professionals on the wording and put in my calculated figures:

exports of electricity from Ontario have contributed between $1.2 and $1.8 billion of costs annually to Ontario’s Global Adjustment Charges between 2017 and 2020

2021 Ontario Electricity Data Summary and discussion

2022-02-13T13:17:00.009-05:00

Ontario’s system operator (IESO) was tardy in publishing its “year in review” summary - and I was content to delay mine until their’s appeared. Before diving into the analysis I want to note the some challenges facing the sector as they’ve emerged in my media world:

the role of electricity in the broader energy sector;
the role of natural gas in the electricity sector;
decarbonization;
the role of Quebec supply in Ontario’s electricity mix;
the role of pricing to encourage electrification of transportation;
the role of nuclear and desirability of refurbishing Pickering B,
the role of storage,
the future supply mix,
pricing policies to shift consumption to periods of excess supply.

An annual analysis provides metrics that have utility, but it should be kept in mind this summary level of analysis has limitations. I’ll summarize annual statistics for not only 2021 but also for the years from 2014-2020 to give a perspective on where we were as well as where we are.

If you follow me on Twitter you may have seen the first numbers in the IESO’s summary, albeit in different units, days before the IESO posted them. Whereas the IESO posts these separately I’ll show the past 8 years here:

Read more »

ignore those promoting a death date for natural gas in Ontario's Electricity System

2021-10-28T17:26:00.006-04:00

The last contracting of a new and significant natural gas-fired generating station in Ontario happened 12 years ago.

It's been 7 months since my previous post. Among the reasons for my blogging hiatus is the prominence of the future of natural gas as discussed in the mainstream media, at municipal councils, and at the province’s electricity system operator (IESO). This has put me in the uncomfortable position of advocating for Ontario’s natural gas generating capacity, which I do unenthusiastically, but responsibly must in advocating for consumers. My previous post was titled ‘Ontario’s electricity system has not yet passed gas.’ This post will provide background on the building of natural gas-fueled generating in Ontario with the intent of altering the popular perception of expertise on environmentalism and electricity.

11 years ago I began communicating that the extremely generous feed-in tariff contracts (FITs) being awarded had to result in steep increases in electricity rates. I demonstrated what must, and consequently did, happen in writing driven by my research and data work. Today most ‘experts’ say there were obvious flaws in the procurement of electricity supply in Ontario a decade ago that any idiot could see, but I assure you few idiots, and only a tiny minority of allegedly ‘expert’ ones, did at the time. My target market in writing was primarily the people working in government who had to sit around a table listening to spectacularly poor direction from a Minister or Premier to arm them with better information than the politicians and lobbyists in the hopes of allowing public servants the weaponry to resist those people and actually serve the public. Today the situation is considerably different: the IESO has produced a solid report in response to calls, from lobbyists and politicians, for natural gas to be phased out by 2030.

It’s been several years since direction from the provincial government was obnoxiously poor.

The problems today are elsewhere.

The Ontario Clean Air Alliance (OCAA), led by Jack Gibbons, has seized the opportunity to return to the limelight in Ontario’s energy discourse in calling for “a complete gas plant phase-out by 2030,” an idea it’s actively working to get municipal councils to endorse and commit to desiring. The campaign has had some success as municipalities join on, but phasing out gas has long been a desire of the provincial legislature. Want is not the issue.

Here’s how the OCAA began its response to the system operator’s report:

Yesterday the so-called “Independent” Electricity System Operator (IESO), under the helm of climate denier Joe Oliver, released a report that seems more like a pre-Halloween prank than a serious analysis of how Ontario can lower its climate pollution by phasing out gas-fired electricity generation.

Jack Gibbons is not one who should be talking about emissions in anything but an apologetic manner - as is true of many people the press considers both environmentalists and experts in Ontario electricity policy.

Ontario's electricity system has not yet passed gas

2021-03-15T17:49:00.000-04:00

Ontario's electricity system has not yet passed gas 1 Ontario’s electricity system includes generators fueled by natural gas. This is suddenly a hot topic as a campaign lobbying councils to say no to this type of generation moves through municipalities. The “no gas” lobbying appeals to a desire to reduce greenhouse gas emissions, exploiting predictions of increased use of natural gas in generating electricity in the province. This article will explore what entities have been the key drivers of emissions in Ontario’s electricity system, the credibility of the body being cited predicting increased generation fueled by natural gas and, if all goes well, convince the reader they are not willing to decrease global carbon emissions at any cost.

Background on the IESO’s pretend market

My previous post reconstructed a method to estimate losses on electricity exports out of Ontario. The measure does not indicate Ontario would be better off if it didn’t export its excess, but that Ontario would be better off with data discipline and consistent metrics capable of informing, and influencing, the managers of the system. Most years we pay more, per unit of electricity, and receive less from exporters of that electricity. It’s a bad trend, but not one Ontario’s electricity system has been structured to notice.

In Ontario the system is operated by the IESO. The IESO’s system includes what should be called a pretend market - it was called a hybrid market when introduced in 2005 after a collapsed attempt at a real market, but it’s deteriorated significantly since then. From a recent report:

...Over 98% of Ontario’s generation costs are controlled through either regulation or contracts, and even the fixed costs of most of the assets that trade on the market are contracted. As a result, less than 2% of the total system costs are actually price-exposed and influenced by the market (the dark blue area)

The creation of a market for electricity in Ontario revealed itself as a fantasy in four acts:

the freezing of the market price shortly after its birth in 2002 killed any chance of merchant generation getting built;
the introduction of the global adjustment mechanism (2005) separated the contracting of new generation from a need for revenue from sales into the market, and was accompanied by regulating rates for public Ontario Power Generation (OPG) nuclear and very large hydroelectric generators;
the introduction of contingency payments to keep coal generators operating after the market collapse of 2008, and,
Regulating the rates for the remainder of OPG’s hydro-electric facilities for 2015.

Ontario lost a record $1.8 billion dumping excess electricity in 2020

2021-01-08T10:11:00.002-05:00

$1.8 billion dollars: that’s how much Ontarians lost selling electricity to neighbours in 2020 once the revenues earned from the sale are subtracted from the cost of producing the power.

By one accounting, which I’ll show is an Auditor General’s.

It’s been a while since my last post, during which period this blog turned 10. A decade ago, this month, a Premier noted some people think discussing losses on exports is fun, and at the same time lectured, “what you want to do of course is try to manage your system as best as you can so that there's as little extra electricity as possible.” Looking at the longer trend with the benefit of hindsight will be fun (of course), and as an added benefit it will provide a measure of the quality of the system’s managers.

Last month I was contacted by a friend looking to update claims from the 2015 Annual Report of the Office of the Auditor General of Ontario (the Auditor), including:

From 2009 to 2014...Ontario exported 95.1 million MWh of power to other jurisdictions, but the amount it was paid was $3.1 billion less than what it cost to produce that power

From a statistics viewpoint the biggest part of this challenge is figuring out what that $3.1 billion claim was based on. It turns out it’s demonstrated by Figure 10 in that 2015 report - and now we descend into the sordid world of Ontario’s electricity data to determine the origins of the numbers visualized in that graphic.

I’ve added a tabular table which shows the figures I transcribed from the Auditor’s Figure 10 - not a precise process but one that provides valuable estimates for what is visualized. The difference between the cost of production and revenues in the graphic equal $3.1 billion. Before discussing the “cost of producing Exported Power...as estimated by [Office of the Auditor General of Ontario]” I will note both figure 5 and figure 10 in the 2015 Auditor’s report cite the IESO (Ontario’s hybrid electricity system operator) as the source of revenue from exports: figure 5 prints the figure for 2014 as $636 million while my transposition of the graphics - -done as it’s clearly not that - puts the figure a little below $750 million.

Same source, same measure, same year: two numbers. I’ll revisit this after I discuss a methodology behind the cost of producing exported power that reproduces the results graphed in the Auditor’s Report.

Changes: choosing Time-of-Use or Tiered billing

2020-10-18T12:13:00.000-04:00

The Ontario Energy Board recently announced Regulated Price PlanS (RPP) for the winter (November-April). New for this year is consumer choice: Time-Of-Use (TOU) pricing will remain the default option, but individuals can opt to switch to the tiered pricing structure that many will be familiar with from before they were forced onto TOU pricing. Some have asked my opinion on switching - which I'd given without thinking it worthy of blog post. Now that I've heard others opine I offer a blog post to defend my very simple advice - and comment on the choices in the context of cleaner energy policy.

If you use less than the level of usage set for the lower-price tier (1,000 kWh) you should switch to tiered rates.

That's it: no gathering up all your bills, getting your hourly usage by registering on the web with your local distribution company (LDC), and crunching the numbers.

Just switch.

Now for me rambling on to justify that one line if only to justify my simply statement while everybody else I hear is advising researching ...

Messages from July's Global Adjustment figures

2020-08-18T10:47:00.000-04:00

Ontario's electricity system operator (IESO) released the final July global adjustment figures yesterday. July is the first month of new global adjustment "Peak Demand Factors" for participants in the Industrial Conservation Initiative (ICI), and therefore it's the month that gives an idea how severe the cost shifting from the Class A consumers participating in the ICI to the other consumers in Ontario (Class B).

"To B." - Ontario electricity rate designer.

Collectively class A consumers share of the global adjustment costs shrunk to 16.7% from 17.7%, which had shrunk from 19.2% the previous adjustment period. From July 2019 thru June 2020 the shrunk share for Class A meant $215 million more transferred to Class B consumers - or the taxpayer that subsidize them - and that will increase by about $150 million a year for the next 2 years due to the Ford government's decision to suspend the requirement to reduce consumption during peak periods during the current adjustment period.

Some good news from the global adjustment reporting is Class A consumption is continuing to recover since sharply dropping towards the end of March

Government manufactured high electricity demand should end the ICI

2020-07-20T15:29:00.001-04:00

Each day from July 7th to 10th saw an IESO "Ontario Demand" peak higher than any day since July 2013, and July 6th saw the 7th highest peak since 2013's summer. The government had made some announcements that encouraged this month's higher peaks:

On Saturday, May 30th, the government announced the suspension of time-of-use (TOU) electricity pricing, replacing it with a flat rate until the end of October, and,
On the afternoon of Friday June 26th the government announced, "companies that participate in the Industrial Conservation Initiative (ICI) will not be required to reduce their electricity usage during peak hours"

The second of these announcements was the most impactful in spurring higher peak consumption, but a review of multiply pricing impacts, and our ability to measure them, will provide a perspective for controlling systemic costs.

Consequences of Ontario's Green Energy Act warn against creating green new deals as stimulus

2020-05-03T14:55:00.001-04:00

As economic activity takes a seat way back from the driving priority of halting the spread of COVID-19, recession is looming, and proposals popping up for spending to spur recovery. People, particularly those in Ontario, should be informed on the actions to spur stimulus during the last big recession, for two big reasons. This post will concentrate on the first - which is the cost, and benefits, of the actions initiated by the Green Energy and Economy Act of 2009. I'll tally up costs incurred due to the electricity procurement than followed, and note the impact on post recession Ontario in quickly noting how those costs have been getting paid - and then I'll conclude with the second reason people need to know this history and its current impacts.

The Green Energy and Green Economy Act (GEA) was introduced to the legislature early in 2009, and received Royal Assent 3 months later. It provided the basis for a contracting orgy that persisted until the fall of 2011 before slowing to occasional carnal encounters. The impetus of the "green energy" push was a waning economy, as described by Karen Howlett and Renata D'Aliesio in 2011:

[Ontario Premier Dalton] McGuinty began looking at where to place his strategic bets during the global economic recession in 2008, when manufacturing jobs were quickly vanishing in Ontario. He solicited many opinions, said a source close to the talks, and the jurisdiction that kept coming up was Germany.
Mr. McGuinty turned to David Suzuki, Canada's best-known environmentalist, to set up a meeting with the father of Germany's green energy revolution, Hermann Scheer, in June of that year. The German parliamentarian arrived in Mr. McGuinty's office in the Ontario Legislature with a blueprint for building a new economy from scratch.
The McGuinty government heeded the now-late Dr. Scheer's advice. George Smitherman, then the new energy minister, adopted the "feed-in tariff" model that Germany used to become the world's first major renewable energy economy, committing to pay above-market prices for green power.
Liberal MPPs learned about their government's push into green energy in the fall of 2008 during a caucus retreat at the Benmiller Inn in Goderich, where Mr. Smitherman talked about the potential to create 50,000 jobs...

Ontario's green energy procurement were far from Keynesian economics. Instead of government borrowing to invest in the infrastructure that would aid productivity and grow wealth in the future, the government avoided borrowing by attracting private capital by offering generous contract terms trusting its existing global adjustment mechanism would allow the costs to be paid by electricity ratepayers. My understanding of economic theory is deficit spending on infrastructure during bad times allows for productivity to jump when better times return - but the GEA's contracting avoided growing government debt in return for making electricity more expensive in better times.

The Government of Ontario is committed to fostering the growth of renewable energy projects, which use cleaner sources of energy, and to removing barriers to and promoting opportunities for renewable energy projects and to promoting a green economy.
...
The Government of Ontario is committed to promoting and expanding energy conservation by all Ontarians and to encouraging all Ontarians to use energy efficiently. -Preamble to Bill 150 2009

The obvious costs from the GEA period are due to contracts awarded under the feed-in-tariff (FIT) program and related Green Energy Investment Agreement (GEIA) - better known as the "Sumsung deal". Less well known are the Hydroelectric Contract initiative (HCI) and Hydroelectric Energy Supply Agreements (HESA). Another stated goal of the Green Energy was the promotion of a 'culture of conservation' - with 'energy efficiency' and 'demand management' prominent phrases being joyously bandied about in and about the legislation. I've pulled the figures for those contracts, and conservation spending, from my database of estimates:

Influence Peddling: lobbying in Ontario's electricity system

2020-04-28T12:16:00.002-04:00

Prior to COVID-19 arriving here in Ontario, and paralyzing society, I'd read some papers dealing with the electricity system. These papers may seem a trivial topic today, but the last major economic shock saw the Green Energy Act successfully lobbied and implemented by people who'd been laying in wait for a crisis to manipulate.

_____

In a conversation on January 24, 2020, at an Ontario Energy Network Event, Terry Young, (IESO Vice President Policy, Engagement and Innovation) interviewed IESO President and CEO Peter Gregg.[1] The VP lobbed a question he figured the head of a storage company would ask if she could use the app for questioning, and the President and CEO responded with what a big area of focus the niche was for the IESO.

40 Days after the IESO’s leadership channeled questions for the head of NRStor Inc., with the President acknowledging even if storage wasn’t economic they’d figure out some tricks to make it so, Blackstone, “one of the world’s leading investment firms”, completed the acquisition of NRStor C&I L.P. The head of NRStor congratulated some financial firms on the sale, indicating it was likely the company was being shopped as the heads of the sole contractor of their products were having a conversation pumping their products.

Storage may be important.

Influence definitely is.

Blackstone would not be the first company deciding the way to get into the Ontario market/bonanza is through purchasing existing “stakeholders” - the industry’s preferred euphemism for insiders.

_____

Three documents I read this year (prior to the COVID-19 pandemic hitting the province) either target the IESO to form policies for the lobby’s technology, or suggest actions that fit into the IESO’s preferences (which are, unfortunately, often dictated by the Electricity Act):

With the likelihood governments will be looking to stimulate economies should we ever exit lock-down mode, and assuming they’ll forget the long-term damage done by the very stupid procurements done in Ontario following the financial crisis, it might be worthwhile to quickly review what’s being pitched.

_____