Friday, December 30, 2016

Nuclear Ontario - and giving electricity away

Since I posted Reliable Electricity Generation Capacity declining in Ontario the IESO's NPCC 2016 Ontario Interim Review Of Resource Adequacy was published.
It's exciting stuff:
The Independent Electricity System Operator (IESO) submits this assessment of resource adequacy for the Ontario Area in accordance with the NPCC Regional Reliability Reference Directory #1, “Design and Operation of the Bulk Power System.” 
Spoiler alert!
The report concludes Ontario's system can meet Loss of Load Expectation (LOLE) criteria for the 2017 to 2020 planning period once Emergency Operating Procedures (EOP) are assumed. EOPs are indicated to be essentially 1/3rd public appeals to reduce consumption, and 2/3rds voltage reductions.


I wrote "With the exception of 2013 the capability at peak has declined every year since 2010, despite IESO-connected generator capacity being greater now than it was six and a half years ago," so I thought it only fair I offer a brief analysis of how the IESO is meeting the reporting requirements for resource adequacy - and the repercussions of how they are doing so.

The first thing the IESO has done is knocked down "high demand growth" potential - for 2017-2019 about 3 times more than they knocked down the "median Demand Growth" scenario.

The second thing the IESO has changed, in the past year, is raising the "Available Resource Forecasts" to meet summer peak demand:

2 interesting aspects of this table:

  1. 2016's review increased available resources for summer peak - which my review of the IESO's 18-month outlooks indicated have been in a long decline, and
  2. 2016's review, from this IESO document approved December 6th, 2016, has resources for summer peak at 28,177 megawatts (MW), which is 2,510 MW - or 10% - higher than the "Forecast Capability at Outlook Peak" the same IESO reported in its December 15th 18-Month Outlook.
Regarding the second point, the resource assessment indicates its much higher number is due to calculating 100% availability from thermal units (after "discounting for seasonal derating") and "Projected effective capacity of the following demand-side resources: Peaksaver, Demand Response (DR)/ Capacity-Based Demand Response (CBDR) and Dispatchable Loads." 

This approach may have merit, of course, but the resource assessment's 2017 normal weather, median demand growth, peak is only 168 MW greater than the 18-month forecast's normal weather peak for Summer 2017. Effectively the IESO's resource assessment provides demand figures after demand-side resources are applied while also counting on those resources to meet demand. 
That could be problematic.

The increase in the IESO's expected "available resources" is due, entirely, to the extension of pre-refurbishment lives of nuclear units at Bruce Power.
  • A nuclear refurbishment outage that was previously expected to take place commencing in 2017 has been deferred, leading to increased resource availability in 2017, 2018 and 2019.
  • Additionally, in 2019, another nuclear refurbishment outage that was previously expected to take place has been deferred leading to even more resources available in 2019
Revisiting Ontario's 2013 Long-Term Energy Plan (Figure 14) indicates the deferred refurbishment outages are at Bruce A units 3 and 4 - both beneficiaries of the operator's maintenance program's innovative shifting of fuel channels.
Note the increases in 2017 and 2018 are less than the total benefit of extending Bruce Unit 3, so aside from nuclear capacity expectations shrunk in the latest resource adequacy assessment.

There is an expensive downside to leaning on nuclear units to provide a greater share of resource adequacy, particularly in Ontario where the saboteurs of 2008-11 succeeded in intermittently flooding the grid with output from industrial wind turbines and solar panels. The term "Surplus Baseload Generation" became known when supply dropped rapidly during the 2008-09 recession. "Baseload" refers to anything in Ontario contracted on a "must take" basis, which includes generation from nuclear, significant hydro, some gas (now declining), wind and solar. The Hourly Ontario Energy Price (HOEP) tracks the price of natural gas when Ontario is not in a surplus baseload situation - when it is the HOEP will drop to $0, and beyond. Counting the number of hours the HOEP fails to rise above $0 each year, it's possible to spot the return of Bruce units 1 and 2 late in 2012, and the relentless rise of wind and solar capacity since that time:
I've designed this graphic to show the number of hours by time-of-use period because surplus supply situations are often described as overnight occurrences, but this is not longer true. Another view of the same data, this time showing the percentage of hours the HOEP fails to rise above $0, demonstrates the rapid rise in daytime (On-Peak and Mid-Peak) electricity giveaways.

What the IESO forecasts, and reliability reporting, is indicating is the nuclear industry is vital to resource adequacy in the province. This would be a better thing if the IESO and its political masters understood what resources will never be vital to our resource adequacy.

The reality of needing nuclear's full capacity in the coming years should spur programs to utilize all generated power - much of which is now dumped on export markets or curtailed altogether.  If the IESO, and their political masters, understood this,  and wished to be useful, it's unlikely they'd be dropping their "High Demand Growth Forecasts" concurrent with their own market's price collapsing and rising interventions, by them, to curtail committed generation.

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