Issue 1, Volume 1

"The Ontario Green News"

 

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Ben Bennett: Solid Waste in Ontario

Frank De Jong: A History of the Green Party in Ontario

Glen Estill: Electricity in Ontario

Bill Hulet: Gandhi, Agriculture, Justice

Gayle Valeriote: Poverty in Ontario---Voices from a Neighbourhood

Peter Meisenheimer: The Great Lakes Fishery

Doug Woodard: Energy and the Fossil Fuel Situation

Regular Stuff:

Editorial

Columns

The Green Library: John Ruskin's Unto This Last

 

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Electricity in Ontario: Glen Estill

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Restructuring Ontario's electricity market has dominated Ontario politics for the past year. Debate has focused on price and the privatization of Hydro One, however, and largely ignored the environmental record. In order to get a real feel for the situation it is important to understand exactly how Ontario's electricity is generated and the impact that each method has on both our environment and the economy.

 

 

Where Ontario Gets Its Electrical Power

Nuclear

Coal and Oil

Water Power

Natural Gas

Wind, Solar, Biomass

 

37%

29%

26%

7%

1%

 

 

 

Nuclear

Nuclear power doesn't directly contribute to climate change or smog. But the long term waste storage problem has yet to be solved.

In the United States the government is planning to ship nuclear waste to a central storage location atYucca Mountain in Nevada. Because of the extreme length of time this radioactive waste will remain dangerous it has gone to the extreme length of hiring an anthropologist to work on the project team. His task is to find ways to communicate with and warn people who will be living 10,000 years from now about the dangers posed by this waste repository. This is a far from trivial task. A piddling four hundred years ago Shakespeare was writing plays that today's people find hard to understand. Ten thousand years ago humans were experimenting with agriculture using pointed sticks. Isn't it the height of arrogance to believe we can safely predict what human society will look like hundreds, let alone thousands of years in the future?

And although engineers claim that the Canadian CANDU atomic energy system is safe, many times trusted technology has failed. (Space shuttles are supposed to be safe too). Ultimately, we can only hope that specific engineers are right in a specific context. .

One aspect of nuclear power is not open to debate, however. It has proven very expensive. This has been masked, however, by a financial sleight of hand. The provincial government has assumed the debt associated with the construction of the nuclear fleet through the Ontario Energy Finance Corporation. This means that Ontario Power Generation and Bruce Energy have been left with the assets minus the mortgage. Not only without the mortgage, but also without the cost of demolition and cleanup. This is because they have not been forced to create the huge financial reserves necessary to cover future decommissioning and waste storage. Once we remove the cost of building the plants, taking them apart, and safely storing the waste---nuclear power appears cheap. But this is simply because the full cost is not being calculated.

In addition to the intrinsic problems mentioned above there are also incidental issues associated with such an inherently complex and dangerous technology. Even after all the years that the CANDU system has been in operation it still seems to be difficult to accurately predict the cost and length of time needed for major repairs. The 2000 MW Pickering "A" plant was supposed to cost $800 million to refurbish and the work should have been done by 2002. By now the latest budget estimate is $2.5 billion and it is hoped that the final unit will be returned to service in 2006.

 

 

 

Coal and Oil

Much more coal than oil is burnt in Ontario to create electricity. It fuels 5 plants in Ontario: Nanticoke, Lambton, Atikokan, Lakeview, and Thunderbay. Coal burning creates nitrogen oxide (NOX), a key contributor to smog; sulfur dioxide (SOX), which causes acid rain; and carbon dioxide (CO2), a greenhouse gas. Burning coal also releases other pollutants such as mercury. (This is a potent neurotoxin that accumulates and concentrates as it travels through the food chain.)

While scrubbers can be installed on coal plants to reduce nitrogen oxides and sulfur dioxide emissions, carbon dioxide cannot be removed. The coal industry often talks of "clean coal" but removing the carbon dioxide would require overcoming some of the basic laws that govern chemistry and thermodynamics. To be totally honest, the industry really should use the phrase "less filthy coal".

Ontario's coal plants cannot even be described as "less filthy". There are plans to install nitrogen oxide scrubbers on 4 of the 12 units at Nanticoke and Lambton, but that would leave the remaining 8 units without any controls. And installing this technology slightly reduces thermal efficiency. This means more coal must be burned to achieve the same output. This, in turn, increases the emissions of carbon dioxide and other pollutants. Sulfur dioxide has been reduced by switching to lower sulfur coals but electric power generation in Ontario still continues to be the largest single emitter in the province.

Coal generators in Ontario cause roughly 20% of the province's emission of nitrogen oxides. At high summer temperatures this reacts with other chemicals in the air to create ground level ozone, a lung irritant that has been associated with breathing difficulties and asthma. The Canadian Medical Association estimates that every year approximately 2000 Ontarions die prematurely from smog. Thousands more Ontario citizens have smog-related breathing problems that result in a reduced quality of life.

Acid rain, smog, mercury, climate change---whenever we turn on a light in modern-day Ontario we are substantially contributing to these problems.

 

 

Natural Gas

Natural gas is less polluting that coal. The carbon dioxide emissions from a state of the art Combine Cycle Gas Generator are half the rate of coal. Sulfur and mercury emissions are non-existent, and nitrogen oxide emissions are reduced by 90%. So natural gas is better than coal. But there are still significant problems associated with its use.

The key concern with gas is availability and the environmental damage created by expanding production. In the key producing areas of Texas, Oklahoma, and Alberta productivity is in serious decline. The average gas well drilled today is depleted by 50% within two years. In conventional areas all the large wells have already been found. This means that today the industry relies on constantly drilling new smaller wells in order to keep the pipelines full. Anyone looking for market-based evidence that natural gas is in short supply should consider the fact that the price of gas has spiked during peak demand during the past 3 winters. New sources of gas exist in Alaska or the McKenzie delta, but the wells will be expensive to drill and have environmental consequences. Liquified natural gas (LNG) allows imports from Algeria or Indonesia. But liquid natural gas is extremely explosive which means that import terminals would make very tempting targets for terrorists. And, again, the technology isn't cheap.

The cost of generating power from natural gas is also an issue. At today's price of $5 US /mm BTU, the cost of the gas alone is 5.5 cents/KWh. Compare that with the 4.3 cent price cap that the government recently imposed. Of course, a natural gas plant needs to cover its depreciation and operating costs. This means that it would need to charge 7.5 cents just to break even. The risk of building a gas generating station in an unstable price and supply environment is very high. Escaping unburnt natural gas (a greenhouse gas 21 times more potent than CO2), escaping sour gas (a very dangerous poison), and the extensive disruption of the earth's surface caused by exploration and building pipelines shouldn't be ignored either. So although burning gas downstream may be relatively clean it shouldn't be seen as a universal panacea to our energy generation problems.

 

 

Water Power

Ontario's water power resources are relatively benign. Most of our plants do not require large flooded reservoirs, and our two largest stations, Niagara Falls and Saunders, are essentially "run of river" facilities. The biggest problem we have with providing more power from water is the limited number of sites left to exploit. But it is not zero. The Beck tunnel proposal for Niagara Falls could supply 1% of Ontario's power from a single project. And there are numerous redevelopments that are either already occurring or that could occur with the right policy environment. These could increase the supply of water created electricity to 29-30% of the provincial supply from the current 26%.

 

 

Efficiency

Finding solutions to the environmental problems caused by how Ontario generates electricity begins with price. We have seen that the current 4.3 cents/KWh price is insufficient to pay for generation using natural gas. It is also insufficient to pay for nuclear---unless the government assumes the debt burden and decommissioning liability. And most importantly of all, it sends the wrong signal to consumers about wasting electricity.

The household sector uses about 30% of Ontario's electricity. Yet the opportunities to reduce household consumption are considerable. Compact fluorescent light bulbs use 75% less power than incandescent. New refrigerators use 2/3 less power than models 13 years old. Indeed, a 13 year old refrigerator uses 1000 KWh more per year (costing the consumer $100 extra per year) and results in the emission of over 900 Kg of CO2. The consumer can buy a new refrigerator, make a 10% return on the electricity savings, and reduce emissions. (This is the high cost of Kyoto that the oil industry complains about.) The Ontario government has announced a 1 year sales tax holiday on certain energy efficient appliances which may encourage some appliance replacement. Motion sensors on lights, insulating hot water pipes, and set back thermostats all work well. Ground source heat pumps (also called earth energy or geothermal) have a co-efficient of production of 3 or 4. That means that they transfer 3-4 units of heat into or out of a building for every unit of energy they use.

But price is a key motivator. Today's subsidized power makes the economics of energy efficient investments far less attractive. In Denmark the retail price of power is 30 cents/KWh which is principally an artifact of high taxes. Compare this with Ontario's 9 cents (which includes the transmission, distribution, and debt recovery charges). The average home in Denmark uses half the power of the average one in Ontario.

The commercial sector uses about 25% of Ontario's power and has enormous opportunities for savings. Let me illustrate with two examples. T8 fluorescent light bulbs use 35% less power than T12's, but most buildings have yet to switch to the more efficient system. (The payback on switching is 2-4 years, depending on hours of operation. T5's use even less power.) Toronto's downtown core will also soon be utilizing water from Lake Ontario to cool some of its buildings with a substantial reduction in electricity consumed.

The industrial sector uses the remainder of the power. Variable speed motors and fans, high-efficiency lighting, heat recovery systems, and co-generation all offer major opportunities for efficiency gains. Again, price is a key driver.

In total, improved efficiency should be able to reduce electricity consumption by 10-20% in just a few years. But it will take the right price for power. It will also take an aggressive education campaign. And it will also take some targetted key investments (such as the Toronto downtown cooling project).

 

 

 

Alternate Energy Sources

Energy can be gathered from wind turbines, solar photovoltaic cells, burning biomass, and adding additional water power sources. Would these allow Ontario to stop using fossil fuels? Could they replace nuclear power plants? How much would they cost?

Wind energy is one of the most abundant resources in the province. A US study of the potential for offshore wind in Lake Erie indicated that it had the potential to generate 144 TWh of power per year. (This is equal to Ontario's total current consumption.) Clearly, an electricity system cannot be fully dependant on wind without back up capacity or some means of storing energy for non-windy days. But it is clear that the power is there if we want to use it. Wind is a cheap alternative to present energy sources. If utilized on a large enough scale it could be available for about 8-9 cents/KWh. The cost of wind energy has been dropping as turbines have increased in size and as production facilities expand in scale. Germany has installed 10,000 MW of wind based power plants in the past 8 years. A similar investment would supply 13% of Ontario's power needs and cut our fossil fuel use in half. In fact, Ontario has 3 times the land mass and better wind potential. This means that it would be probably be easier to implement large-scale wind turbine use here than in Germany. We simply need to create the economics climate for the wind developers. If the Germans can do it, so can we.

Solar photovoltaic is too expensive for consumers who are already connected to Ontario's electrical grid. However, in places where no such connection exists---such as communications towers, construction projects, island cottages, remote communities, etc---solar can be the cheapest source of electricity. It is very reliable and needs little maintenance. The cost of photovoltaic electricity has been steadily dropping as the numbers of systems installed has increased. Ontario's solar climate is not optimal (about 4.5 peak sun hours per day as compared to 8 hours in the US southwest). But as the cost of photovoltaic cells continues to drop solar power may well begin to contribute on a broad scale. Costs will probably decline significantly over the next 10 years.

Biomass energy includes collecting methane produced by landfills. While clearly this source of power is limited, it has been initiated at the Keele Valley, Pickering, Kitchener, and other sites. The gas is collected and burned in a gas turbine, therebye generating electricity from municipal waste. The province could increase its electricity from this source of supply to 1-2% of its requirements with the cost being around 6-7 cents/KWh. Biomass from forest or agricultural waste can also be used to generate electricity. (Care must be taken in plant design, though, as the combustion can have nasty emissions.) Properly designed, such systems could offer a renewable energy source and be climate neutral.

 

 

The Role of Voluntary Green Power Markets

In some jurisdictions consumers have the option of purchasing environmentally-friendly "green" power from their electricity supplier. This allows consumers to voluntarily switch off of coal or nuclear and instead choose a cleaner source of power. Sadly, Ontario's market design has failed miserably in making this option available. Local Distribution Companies (LDC's) like Toronto Hydro or Hydro One are only permitted to sell the standard power pool product. They cannot offer green power. The market was designed like this in order to ensure that LDC's did not take any risk. (The bankruptcy of the Pacific Gas and Electricity Company in California was on the market designers' minds.)

The hope was that green power would be sold by retailers. These are the companies that did door to door campaigns (calling usually at the supper hour) to try to get you to switch to their fixed price contracts. Only one of these retailers ever planned to offer green power and they have been largely shut down since the province announced the price cap. The result is that there is no retailer yet which offers a premium green option to the consumer.

There is one organization that is trying to get around this difficulty: Green Tags Ontario (www.greentagsontario.com). They separate the electricity purchased from the environmentally-friendly elements of production. These elements are then sold to the the consumer at the rate of $75/1000 KWh. The effect of buying a green tag is to pay extra for green power on your electriciy bill. This means that Ontario Hydro is then forced to purchase electricity from an environmentally-friendly source, which displaces production for a fossil fuel generator.

 

 

Conclusion

Can Ontario phase out coal-generated electricity at reasonable cost? The answer is an unequivocal yes. It starts with charging the full cost of production and educating consumers about how to improve efficiency. Then we must pay wind, water power, and landfill gas developers a fair price for their power and encourage them to ambitiously expand their part of the market. As well, public sector projects such as the Beck Hydro-electric power tunnel and the Toronto downtown cooling proposal should be costed-out and funded where the numbers justify the investment. Once the creative energy of the province is unleashed in the drive to replace and eliminate coal use, the momentum created will also lead to the eventual phase out of nuclear.

 

Glen Estill is the President of the Canadian Wind Energy Association (CanWEA) and founder of Sky Generation Inc., an Ontario based windmill development company.