Ontario's Regulator exploring charges on behind-the-meter generation

Two of the best Ontario electricity commentators have written on an Ontario Energy Board (OEB) notice that it is is:

"initiating a policy review to address the question of how a commercial and industrial customer should be billed when they have a Load Displacement Generator (LDG) behind the meter."

It's an important, but obscure issue I feel best explained by looking at the situation in Germany - but let's start with Tom Adams' Selfie Power (With and Without Transmission Charges):

March 31 tweet on tour of, presumably, preferred consumer CHP site

The Ontario government has identified load-displacement generation as “conservation” and provided big businesses with massive incentives and even direct subsidies to expand investment in this type of behind-the-fence generation. A little brew-your-own power is looking like a lifeline for your business. Right?
Not so fast.
The Ontario government is instituting a rate change designed to punish those with behind-the-fence generators...
The rate change seeking to wipe out the incentive to invest in load-displacement generation but will only apply to non-preferred smaller customers.

Bruce Sharp's Linkedin post on the letter is Ontario CHP (Combined Heat and Power) at Risk ?

The primary purpose of the letter is to discuss the retail transmission treatment for CHP, with the possibility of aligning the treatment of LDC-served customers with transmission-connected customers or perhaps leaving LDC-served customers slightly worse off.
Much more ominous is the reference to the Global Adjustment (GA).
GA Class B customers with or contemplating CHP depend on avoiding this charge when they generate. Recently, the GA Class B charge has been near-stratospheric, clocking in at a simple average of $ 95/MWh for the period of Dec15 – Feb16. Meanwhile, the total net benefit of a base-loaded CHP (including the avoided GA Class B charge) ranges from approximately $ 70 - $ 85/MWh.

So, if all of a sudden the GA Class B is charged on a gross load (total load, i.e. net load + generated power) versus net load basis, CHP economics go poof. CHP as a Conservation and Demand Management (“CDM”) measure would be dead in the water

Most of the commodity charge for electricity in Ontario is now in the Global Adjustment charge.

Weekly roundup:ISO's, CSP, nuclear, at the Post,

Solar thermal troubles, no plans for new nuclear, big overbuild due to variable renewable electricity sources (vRES)...

Things from around the web that caught my attention this week included the article I co-wrote with Tom Adams being the first story at the top of the National Post home page for a couple of hours Thursday.

There's a lot I could ramble on about connected to the article, but the one I'll pick to emphasize is communication. It was terrific to collaborate with Tom Adams. Our histories are different, with me being perceived as pro-nuclear, and Tom not so much. My favourite comment received regarding this week's column was "Never thought I would "like" an article (co-)authored by Adams."

Well, there's reason to like most of the posts at tomadamsenergy.com

On the nuclear topic...

holding errorists to account

The fifth anniversary of the the Tōhoku earthquake and tsunami passed this week.

Stephen Aplin has an extraordinary post on authority - earned and fearmongered

Accurate and inaccurate predictions, garbage dumping, and death threats: an easy lesson about nuclear power, still not learned after 1,827 days

...While I am immensely pleased that nobody has died or even gone to the hospital because of the effects of ionizing radiation released because of the meltdowns (radiation has of course been released, but in amounts simply too small to cause harm to anybody or anything), I have found these past 1,827 days to be rather frustrating. I harbour this naive fantasy that those who were surprised to hear me tell anybody who would listen to expect few if any casualties might revisit their initial surprise.
I understand why they were surprised. I was one of very, very few people saying what I was saying. The vast majority of other commentators on the nuclear situation in Japan following the earthquake were saying just the opposite. They were telling everybody who would listen that there would be untold death and disease because of the release of radiation.
I also understand why these prophets, false prophets I should say, got on the air: from the point of view of a media vehicle locked in mortal hyper-competition with other media vehicles for readers/viewers/listeners, it is much much sexier to prophesy doom and destruction. Reassurance is boring, even if it is bang on. I get that.
What I find disappointing is that the prophets of doom, having been proved laughably wrong, are not being called to account. I mean, they said this stuff in public. You might think that having said things that prove they do not know what they are talking about, somebody might, you know, call them on it.
Apparently such correcting of the public record is not a priority in the current media universe.
It should be. There are real consequences to allowing alleged experts to utter falsehoods in the public sphere.

Please read the full post at Canadian Energy Issues.

The deteriorating era

I attended a concert the other night. Donovon Woods opened for Matt Anderson. I was surprised how few young people were there.

That struck me, particularly as I was with my son, and then today I received a link to the following article from my father - the writer of a post on an historically edgier blog I have, After the boom - what?

From the Guardian, Revealed: the 30-year economic betrayal dragging down Generation Y’s income:

A combination of debt, joblessness, globalisation, demographics and rising house prices is depressing the incomes and prospects of millions of young people across the developed world, resulting in unprecedented inequality between generations.

...Where 30 years ago young adults used to earn more than national averages, now in many countries they have slumped to earning as much as 20% below their average compatriot. Pensioners by comparison have seen income soar.

Dylan and the law and electricity and carbon pricing - in Ontario

Today Ontario is announcing its carbon pricing scheme.
Newspapers are writing on it.
Natural gas utilities have some relevant numbers on it.

Also, there is a new report out on electricity in Ontario from Energy Probe and the Consumer Policy Institute, and another from the C.D. Howe Institute.

I want to note the error being broadcast about Ontario protecting electricity consumers from price exempts in effectively exempting the sector from paying for CO2 emissions, and I want to write on less specific issues with Ontario's electricity sector culture.

Two days ago the New York Times wrote on the Supreme Court and Bob Dylan, featuring in the article:

“‘When you got nothing, you got nothing to lose.’ Bob Dylan, Like a Rolling Stone, on Highway 61 Revisited (Columbia Records 1965).”

 The quote was introduced on the topic of "standing" - but it's relevant to Ontario's low emissions electricity sector too. Here's how Union Gas presented the impact of a $100/tonne carbon price:

Ontario's electricity sector doesn't emit much CO2, so there would be little lost in charging for what there is.

$42/year at $100/tonne said Union Gas - in 2025. Many Ontarians, using electricity for heat, will see increases of more than $42 in February 2016 over February 2015.

Keeping in mind $100/tonne would cost $42/year, and that's a dreamy /tCO2e figure given all current price schemes world-wide, here's how the Globe and Mail's Shawn McCarthy reported on news the electricity sector would be excluded:

The electricity sector will also be covered, though its allowances will be free and it will not face a declining cap in recognition of the huge costs to consumers from previous emissions-reduction policies.   -see addendum at bottom for clarification/correction

Not to imply Mr. McCarthy is responsible for misleading people, he's just sucked in on the disinformation campaign of Ontario's Premier. From Global news:

[Premier Kathleen Wynne] revealed economic impacts Wednesday, a day before her government introduces its budget, which is expected to include more details about carbon pricing.
However, revenue from the cap-and-trade auction set for next year will be used to “protect” consumers from an electricity rate hike and could even lead to rates going down, Wynne said.

All total nonsense, but the issues seem too confusing for the broad public.

Toronto is a nuclear city - and a media centre

While the Toronto Star was beating up on the National Post, and vice versa, the Globe and Mail's Marcus Gee wrote Like it or not, Toronto is a nuclear city. Gee's column is that rare write in Toronto that gets facts right.

Such as:

Wind, solar and bioenergy still account for just 9 per cent of Ontario’s electricity output despite the provincial government’s bungled, vastly expensive effort to promote them.

I hope all read Like it or not, Toronto is a nuclear city, but the rest of this column is going to be about media in Toronto's steady production of poorly researched material - just using the 9 % figure.

To start... here's a graphic from a segment of The Agenda with Steve Paikin interviewing newcomer head of Ontario Power Generation Jeffrey Lyash:

I happened to enjoy this interview, but I've been critical of Steve Paikin in the recent past and the graphic shows why. The graphic says, "Source: Ontario Energy Report, July-September 2015" - but that wouldn't be notable on the television during the program. The ontarioenergyreport.ca website does currently show prominently, on its home page, these percentages for 2015's third quarter "Transmission Grid-Connected Generation Output" - which is only a subset of "Ontario's Electricity Supply", and only for the quarter of the year when industrial wind turbines are least productive. If The Agenda's researchers went a step further, to the full supply report linked to following the percentages., they's have found the source table for the full year's data (2015), where wind was 5.8% of the annual "Transmission Grid-Connected Generation Output" subset, and solar and biofuel another 0.5%.

That one step further is how far the Toronto Star's assembled team went in January while assembling Q & A for Ontario’s hydro system.

Too much, or not too much

Too much, or not too much, that is a question for electricity system operators leading to other question

2 stories on electricity generation capacity, both from February 11th:
NY faces power shortage, but not enough to save FitzPatrick nuclear plant

SCRIBA, N.Y. – New York power grid operators say there will be a 325-megawatt shortage of generating capacity after theFitzPatrick nuclear plant and seven other major power plants close. But the report offers no grounds for state regulators to require FitzPatrick to stay open.
Instead, the New York Independent System Operator announced it will solicit proposals for projects to fill the anticipated 325-megawatt gap. Solutions could include new power plants, transmission upgrades or demand reduction programs. The new capacity needs to be in place by 2019, the NYISO said in a report released today.

SO-NE Capacity Auction Secures Sufficient Power System Resources, At a Lower Price, for Grid Reliability in 2019-2020:

Holyoke, MA—February 11, 2016—New England’s annual capacity auction concluded Monday with sufficient resources to meet demand in 2019-2020, at a lower price, and with more than 1,400 megawatts (MW) of new generating capacity that will help replace recently retired and retiring generators. The auction is run by ISO New England Inc. to procure the resources that will be needed to meet projected demand three years in the future.
... “Developers were drawn to the New England marketplace because the price of capacity supports construction of new resources,” continued van Welie. “It’s important to have a capacity market that places an appropriate value on the product to maintain an adequate supply. This auction procured the resources needed to keep the lights on in New England at a price lower than last year’s auction and, in fact, lower than the estimated cost of building a new power plant. More than 850 megawatts of new generating capacity cleared in the Greater Boston, Southeast Massachusetts and Rhode Island zone where the resources are needed most.”
...
1,450 MW of imports from New York and Canada
•The auction closed for resources within New England after four rounds of competitive bidding at $7.03/kWmonth, at the point on the demand curve where there were still sufficient resources to meet demand. The clearing price will be paid to all resources in both capacity zones in the region. [Clarification] Imports from Quebec over Phase II and Highgate also cleared at $7.03/kW-month.
...
• The auction continued for a fifth round for 181 MW of New Brunswick imports, which will receive $4.00/kWmonth. New York imports totaling 1,044 MW, which cleared in the fourth round, will receive a price of $6.26/kW-month.

sooo... 72% of the “1,450 MW of imports from New York and Canada” were bid in from New York, at a price I believe is about 1/2 the non-fuel cost of a simple cycle gas generation plant - and is clearly less than other capacity resources bid into the New England market - yet New York state is looking around for resources for the same period.

How is Ontario not in this game?

The imperceptible impact of carbon pricing

The editorial board of the New York Times has declared Proof That a Price on Carbon Works:

Lawmakers who oppose taking action to lower greenhouse gas emissions by putting a price on carbon often argue that doing so would hurt businesses and consumers. But the energy policies adopted by some American states and Canadian provinces demonstrate that those arguments are simply unfounded.
Around the world, nearly 40 nations, including the 28-member European Union, and many smaller jurisdictions are engaged in some form of carbon pricing. In this hemisphere, British Columbia, Quebec, California and nine Northeastern states have raised the cost of burning fossil fuels without damaging the economy. Alberta, Canada’s biggest oil and gas producer, and Ontario have said they will adopt similar policies.
...British Columbia, which is home to 4.7 million people, has placed the highest price on emissions in North America, taxing a ton of carbon emitted at 30 Canadian dollars, or about $21. By comparison, emission permits in California and Quebec are trading at about $13 a ton. And permits sold for $7.50 a ton in a December auction in the Northeastern trading system known as the Regional Greenhouse Gas Initiative. That system covers emissions from power plants in nine states that include Connecticut, New York and Massachusetts.
These actions deserve applause. But their real value may lie in providing a template for the rest of the world.

The New York Times editorial board is, with one exception, citing actions that have not taken place yet as evidence contrary arguments "are simply unfounded." Is there a topic outside of global warming/greenhouse gas emissions that inspires such intellectual laziness? [1]

Cuomo's trouble-standards

“Getting the facts and understanding them are critically important to serving the public interest...False hysteria is not.” - Rob Astorino

The widely reported big news in the U.S.A. yesterday, as the Supreme Court decided to put the Clean Power Plan on hold until it decides on the legalities (reports from Reuters and AP).

I don't think that's particularly big news because I'm neither a fan of the plan nor confident it will survive the political regime change coming before implementation dates hit.

A couple of things I do find interesting are motivations to clean the electricity generating sector, and anti-nuclear hysteria.

Cuomo strikes contrasting tones at Hoosick Falls and Indian Point

While Cuomo was "deeply concerned" about the leak at Indian Point, he seemed more concerned about untoward panic among residents at Hoosick Falls, despite the fact that the water in Hoosick Falls has been poisoned, and the water near Indian Point is safe to consume.

It already has been verified that the water in Hoosick Falls exceeds federal pollution standards, by at least four or five times what the Environmental Protection Agency has said is safe for humans to consume. What’s more, the toxic chemical PFOA is definitely in the water of Hoosick Falls and the people there have likely been drinking it for years, possibly generations. PFOA, or perfluorooctanoic acid, has been linked to unusual cancers and other life-threatening conditions, and medical professionals in town have documented high rates of cancers. 

The state waited months to take significant action in Hoosick Falls, and assured residents as recently as December that the water was safe to drink. The state Department of Health, along with the village’s elected leaders, have been widely criticized by residents as well as some lawmakers, who are now considering holding legislative hearings on the state's actions in Hoosick Falls.

And though the radioactivity levels in the water near Indian Point spiked upwards in recent weeks, it is still 1,000 times below federal limits. The wells that tested positive for elevated levels of radium (in one case it was a 65,000 percent increase) are designed for monitoring and not human consumption. The tritium, a naturally occuring radioactive isotope, found in the water at Indian Point will likely never reach a source of drinking water.

Read Scott Waldman's full report at POLITICO New York.

The report includes news New York Governor Cuomo the 2nd has already approved one fossil fueled generator to replace and Indian Point nuclear and a second one is moving through planning.

Sierra Club cuddles up to coal

Some people never learn.

An article on the Sierra Club's latest coalition begins:

How does one of the country’s biggest environmental groups decide to partner with one of the country's biggest coal-burning utilities?

That isn't the question people familiar with the Sierra Club's history would ask. From a Time report: 

...between 2007 and 2010 the Sierra Club accepted over $25 million in donations from the gas industry, mostly from Aubrey McClendon, CEO of Chesapeake Energy—one of the biggest gas drilling companies in the U.S. and a firm heavily involved in fracking—to help fund the Club’s Beyond Coal campaign.

How do they decide to partner up?

Money, I presume.