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Ontario’s Long-term Energy Plan: Inside the New Numbers

James Montgomery, Associate Editor, RenewableEnergyWorld.com  December 06, 2013

New Hampshire, USA — This week the Ontario government released its Long-Term Energy Plan (LTEP), which balances a big ramp-up in renewable energy and notable pullback in nuclear.

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Here’s a look at some of the highlights from the LTEP package, which includes the plan itself, plus a handful of background documents about regional planning, demand management and impact to consumers:

  • Ontario’s estimated 2013 electricity production mix is 59 percent nuclear, 28 percent renewables, 11 percent natural gas, and 2 percent coal. The forecasted 2025 electricity production mix: 42 percent nuclear, 46 percent renewables, and 12 percent natural gas. Ontario already has committed to completely eliminating coal-generated power, fulfilling a decade-long goal.
  • Ontario plans to bring 20 GW of renewable energy online by 2025, representing nearly half of installed capacity.
  • Targets for hydroelectric, which represents by far the vast majority of Ontario’s renewable energy portfolio, are being expanded from 9.0 GW to 9.3 GW.
  • More than 10 GW of wind, solar, and bioenergy will come online by 2021. That’s an extended timeframe from the previous 2010 LTEP which had targeted 2018.
  • Underscoring stability and predictability, the LTEP commits to a new competitive procurement process with the Ontario Power Authority (OPA). Procurements for 2014 electric capacity are 300 MW wind, 140 MW solar, 50 MW bioenergy and 50 MW hydro; 2015 procurements are identical except a slight narrowing of hydro to 45 MW. Anything developed but not procured or under contract will be reallocated into 2016 targets.
  • Expanded demand response programs to shave 10 percent off peak demand by 2025.

Regional industry groups representing solar, wind and hydro all welcomed the government’s updated plans.

The Canadian Solar Industries Association (CanSIA) is pleased that the targets take into account solar across the spectrum — from residential and commercial rooftop to utility-scale solar. They point to the proposed competitive procurement of large-scale solar in addition to the 200 MW of smaller-scale solar projects under the feed-in tariff (FIT) and microFIT programs.

The Ontario Waterpower Association (OWA)welcomed the news as well, saying the increased commitment to hydro — including pumped hydro storage — “provides improved investment certainty.” Still, those groups see room for improvement. CanSIA renewed its call for a 5 percent target for solar electricity consumption by 2025. The Canadian Wind Energy Association (CanWEA), while acknowledging the need for annual reviews of supply/demand, urged longer-term targets of wind to meet 15 percent of electricity demand by 2031.

The LTEP’s renewable energy thrust isn’t so surprising; much of it already has been contracted or planned, and in fact the goals are somewhat less ambitious than early outlooks because of stable and declining demand, points out Tim Weis, director of renewable energy & efficiency policy at the Pembina Institute. A real barrier for the renewables uptake will be how much electricity prices go up and the perception that renewables (especially wind) are causing it, and defusing that backlash by outlining true overall system costs, he pointed out.

The other significant takeaway from Ontario’s new LTEP is the reduced commitment to nuclear power to less than half its total mix. Ontario has long relied on nuclear for the majority of its electricity; we heard officials reiterate that position just weeks ago during a tour of the region’s renewable energy landscape, a strong commitment “which used to be guaranteed 50 percent come hell or high water,” Weis noted.

Now the government is acknowledging that refurbishing existing nuclear sites is a better option than building new ones, and investing in conservation and incrementally-added renewable energy is more cost-effective still. Ontario Power Authority has committed $1 billion for prep-work on the Darlington nuclear refurbishment, with timelines that preclude public review of the refurbishment’s total costs or comparison to alternatives, points out Weis.

On top of that, no nuclear refurbishment project in Canada has ever been completed on time and on budget, he adds — the most recent Gentilly-2 plant in Quebec was abandoned when estimated costs topped $0.10/kWh, a price that could be matched and realized far sooner through a combination of green energy and energy efficiency measures, according to Weis.

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