Week 12 Reporting: March GA Prediction

I have updated the weekly reporting to show the week of March 21 - March 27.

The news is in Hour 21(9pm) of Monday the 26th, which saw Ontario importing more electricity than it was exporting.  That's the first hour of 2012 that we have been a net importer.

Demand was down from last year (by about 1900MW per hour!), negative pricing occurred frequently, and steam bypass at Bruce B units not only occurred, but was sustained for days.



The IESO is likely to post the 2nd estimate of the Global Adjustment for March on Monday.  The first estimate was $49.50/MWh, but with the HOEP down to $15.41, the plants we pay for capacity (CCGT) running at under 15% capacity factors for the month, the curtailment of non-utility generators one weekend, idling of nuclear units in addition to steaming off production .. I'll estimate it at $58.
I don't account for all those factors in the spreadsheet I estimate with - but here is the stats part of the estimate:

	MW	$/MWh	Expense
Nuclear	6,403,369	57.5	$368,193,718
Hydro	2,894,774	37	$107,106,638
Wind	502,058	135	$67,777,830
Gas	1,458,987	100	$145,898,700
Coal	294,899	35	$10,321,465
Other	95,405	600	$57,243,000
Solar	0	600	$0
Imports	245,867	$15.41	$3,788,168
Total	11,895,359	$63.92	$760,329,518
			$61.64
	MWh	$/MWh	Recovered	Not Recovered
Ontario	10,758,751	$15.41	$165,764,233	$521,915,388
Exported	1,136,608	$15.41	$17,512,159	$55,137,739
	11,895,359		$183,276,392	$577,053,127
			GA Est	$53.64
			GA With $30M	$56.42

At Any Price: Wind as Negative Load, Not Generation

If wind is treated as ‘must take’ then it ought to be treated as negative load. The net load for the schedulable generators is then

Net = Actual – Wind

David B. Benson on Brave New Climate Thread 

I thought that was a very elegant truth when I read it a couple of weeks ago, and fought the urge to write at length in support of the simple statement.  With the release of Ontario's feed-in tariff (FIT) review last week, celebrating 10700MW of renewables to be operational by 2015, I was more tempted to produce volumes illustrating the simple truth, and when I read Tom Adams' "The affliction for consumers is not a surplus of baseload generation but a surplus of take-or-pay generation, some of it stupidly expensive,"  I started pulling data and formatting graphs.

The term load is meant as the power consumed.  Generation must meet the consumption, so it is reasonable to view all the various generators as supply, and the demand as load.  Wind and solar contracted on a 'must take' basis, which the FIT contracts are, isn't meeting demand, but it is changing the load that must be met by other generators.

Baseload therefore refers, initially, to demand.  The first graph shows baseload as the minimum daily Ontario demand.  Between 2005, and 2011, the minimum dropped -on average 1574MW.  That, coincidentally, is about the capacity of nuclear supply due to return as Bruce 1 and 2 return to service (I think the contracts were negotiated in 2005).



Baseload supply generally refers to supply that is to meet this minimum demand - which would be the base load.  It is usually expensive to build, and cheap to run; that means nuclear, but it can also mean hydro, combined cycle gas generators (CCGT), theoretically with carbon capture - the same for coal plants, etc.  In general the characteristics are large capital costs and lower operating costs (MIT recently published this on the impact on existing generators from increasing renewables).   Baseload supply did serve to reduce the amount of peaking, or intermediate, supply that the remainder of the generation mix needs to meet demand.  Wind especially, but also solar, do the opposite - they increase the daily swings in demand.  To the rest of the generators, there are not only more accurately in the 'load' equation, they are the least predictable factors in that equation.

In Ontario, baseload supply was approximately: 2500MW of hydro (varied by season), 11000MW of nuclear - which was about right in 2005, and a number of natural gas (primarily) generators were contracted on a 'must take' basis, adding another 1000MW.  Nuclear generator availability not being 100%, this was appropriate until demand drops accelerated.  Until the deep recession of 2009, exports hid the excess capacity, but since then the term "surplus baseload generation' (SBG) entered Ontario's vocabulary.

In 2009 Ontario introduced a feed-in tariff (FIT) program.  Graphing the most recent 12 months, starting spring 2011, the variance in wind output , is seen to vary from the day's minimum daily demand to the maximum daily demand by about 1000MW (from over 1400MW of wind capacity).  I've included the variance in Ontario's 11000MW of nuclear output too. Nuclear units do occassionally suddenly require to be taken offline, and, increasingly frequently, either have output reduced (through bypassing steam), or are dispatched off if demand exceeds domestic load plus the capacity to export.  However, the 11000MW of nuclear is more stable than the 1400-1600MW of wind

This leaves sources for matching demand above the minimum (non-baseload).  For the same time period, the actual differences between production at the day's minimum demand, and at the maximum, is charted.  When the FIT review noted we were on track to achieve 10700MW of renewables supply by 2015, it also noted coal would be eliminated by then - note the variability of hydro and gas rarely exceeds 5000MW, and doesn't exceed 7000MW on any day.

I've gone back to the data set I built for an earlier series of posts, adding wind capacity to set wind at 8100MW, and I've also grabbed a sample data set for solar production in London, Ontario (the capacity factor is 13-14%), and set the solar capacity level to 2600MW.  The graphs based on this data are projections of 2016 if all goes as planned.

I now differentiate demand from load - with load being demand less wind and solar.  The base load is a lot more base with wind and solar in the mix!
The average is about 3000MW lower, and 7000-7500MW is probably a better estimate of what base load remains.  With 2000-2500MW of hydro, and another 1000 of gas, the available room for baseload nuclear would only be 4000MW even if we assume no more load following generation would be required on the grid.  The renewables target certainly devalues Ontario's investments in nuclear capacity - and it is likely to increasingly devalue Ontario's public hydro assets as they are enslaved to balancing privately owned renewables.

But this doesn't mean we can do without the capacity that nuclear is providing.  The 10700MW of renewable supply only drops the annual peak load by 1400MW.  Note there are many days in this graph where the daily peak load is less than the daily minimum, base, load from 2005.
The graph demonstrates we do essentially need today's generation capacity, in addition to whatever renewables are added.

The difference between the two preceding graphs emphasizes the need for flexible generation.  Recall that Ontario's hydro, and gas-fired, generation rarely varies over 5000MW presently, and hasn't hit 7000MW, while by 2015, if all goes according to plan, we'll need 9000MW variances on a regular basis, with a maximum daily load variance of over 11000MW.

These things are known - although I'm not convinced the math had been done.  The Independent Electricity System Operator (IESO) is busy developing a scheme paying renewable generators not to generate.  That essentially pays them to inflate the load (as the production isn't subtracted from demand), in order for existing baseload to continue functioning.  The Ontario Society of Professional Engineers is encouraging that initiative and urging more money be spent on making nuclear more flexible.

Nobody seems to be able to get the government to accept the obvious.

It's a lousy supply mix - and they are making it increasingly worse.

At any price: Reviewing Ontario's FIT review.

Last week the Ontario government rushed out FIT review.  The review was reported to have been with the minister only 3 days, but that was enough to release it the same day the Opposition Leader's bill to abolish the program was voted on, and defeated, in the provincial legislature.  That was a very quick turnaround for a ministry that has been sitting on the Integrated Power System Plan submitted by the same body - the Ontario Power Authority (OPA) - prior to last fall's election.

I disagree with the FIT program for a number of reasons - economic, political/social, and environmental (reasons have been explored in previous blog posts one, two, and call this three).  I'll again briefly review how the program increases pricing, how it kills jobs, and how it can only  increases emissions.  I'll also look at the supporters of the policy, and what they have in common that enables them to argue an unsubstantiated positions successfully.

The Executive Summary claims 20,000 jobs, but it is difficult to locate the source for the figure.  It wasn't that hard to convince people during the election that jobs were being created, because the few subsidized plants can be visited - whereas nobody is paying to put faces on the 330 jobs moved to Buffalo in the past year, or the Xstrata jobs now in Quebec, or the jobs that will flow, with cheap exports to Michigan and the Watertown areas.  The accounting is imprecise, but a net benefit not only hasn't been demonstrated, multiple studies, in other jurisdictions, show net job losses due to energy job creation policies.  Ontario's total employment figures trend to support those studies.  It must also be noted that the price of the $27 billion of investment the government claims from the FIT program added to the deal with the Korean Consortium comes with contracted power purchase commitments approaching $3 billion a year (for under 16TWh of supply).

One common refrain has been that the renewable generation thus far introduced can't have increased residential bills because there isn't much of it.  It seems rather silly to rebut arguments that power at $110+/MWh, supported by expensive CCGT (gas) plants to run at low capacity, could bump far cheaper, publicly owned, supply, and bills not be impacted, but ... Most residential consumers know more about the total increase in their bills than the line items those increases are occurring on - and the bulk of the increases previously came on the delivery line (which is convenient for the government as it varies from one area to another).  The government attributes this to the sorry state of the system left by the previous regime, but reviewing Hydro One's annual reporting that doesn't hold up.  OM&A expenses are up only 32.5% over the past decade - capital expenditures are up 5 times that percentage.  I don't need to argue that the spending is primarily driven by new initiatives - the bookkeeping says it is.  Hydro One's rates are set on a formula based on a return of equity, so they have an incentive to categorize expenses as capital expenditures - but certainly a great amount of spending is being done to accommodate intermittent renewable generation sources (including the smart grid initiatives to facilitate more distributed generation sources, and to influence demand profiles).

Industrial wind turbines, and solar panels, are not expected to lower greenhouse gas emissions in Ontario - nor are they likely to reduce any other type of emissions.  The Ontario Society of Professional Engineers (OSPE) recently released a report titled "Wind and the Electrical Grid: Mitigating the Rise in Electricity Rates and Greenhouse Gas Emissions."  That report is fine, but it makes some assumptions that are questionable including suggesting Ontario could get long-term power purchase agreements from other jurisdiction, for clean electricity production (in terms of greenhouse gas emissions).
The suggestion is not credulous.  The New England states, including Massachusetts, refused defining hydro as clean specifically to encourage local generation over clean imports (not only from Quebec, but if there was free trading the 4000MW undeveloped on the Churchill system would likely find a way to be developed).  Similarly, hydro projects in Manitoba are seeing big reductions in commitments for long term PPAs from Minnesota, concurrent with Minnesota planning to move to more local production.  Ontario is a poster child for how not to trade to begin with - having both protectionist legislation for production, and dumping excess production far below the price paid within it's borders.
The other mistake OSPE makes is assuming the government has any intention of maintaining greenhouse gas levels at the low level they have finally returned to.  The last time we were at emissions levels this low the environmentally credentialed Maurice Strong had just taken over Ontario Hydro and nuclear units would soon start to be idled, as coal units would be cranked up.  Between 1994 and 1998 CO2e emissions would double, and by 2000 emissions were 2.5 times what they were in 1994.  The country most often cited as inspiration for Ontario's FIT, and related energy policies, is Germany.  Despite the absorption of dirty East Germany, German electricity generation from fossil fuels (lignite, hard coal, natural gas and petroleum products) is unchanged since 1990 (translate last listed .pdf here).  
Emissions are not the target of the supporters of renewables.

1978 Book Cover (sourced from BNC)

In Ontario, as in Germany, it is increasingly clear that the nonsense about what renewables are supposed to be doing (generating electricity) is simply a mask for what they really are doing - which is eliminating the possibility of having significant baseload supply operating on the grid.

Specifically, they are weapons to displace nuclear.  And in blessing this FIT review, Bentley has moved to finish off the annihilation of Ontario's nuclear sector started by Minister Smitherman.

Ontario's Sick Electricity Sector Symptom of the Week: Paying gas generators not to generate

It will be a couple of days until I'll update the weekly reporting, but the generator data is set, and much of the pricing data.  In week 11 (March 14th - 20th) the frequency of steam bypass maneuvers at Bruce B increased, but we also see another supply curtailment method used over the weekend - the idling of non-utility generators (NUGs).  Over the weekend Ontario appears to have been simultaneously paying one of Canada's power giants, TransAlta, not to produce with natural gas at co-generation facilities while purchasing the output from their intermittently generating wind properties.

Curtailment of the NUGs is usually for a number of days.  One of the reasons is contracts that predate the current electricity system's structure.  The contracts were with Ontario Hydro, and when that ceased to exist they were transferred to the Ontario Electricity Financial Corporation (OEFC).  Operationally, that means the shutdowns need to be scheduled in advance.  In this instance, the surplus baseload generation (SBG) reporting indicated far too much supply over the weekend, and NUG's were curtailed, by about the same wattage as one of Pickering's units, from late Friday night to the demand ramp up Monday morning.  

NUG contracts are private, but estimated above $100/MWh.

2 of the curtailed NUG units were TransAlta properties in Ottawa and Windsor.  Those units produced about 5800MWh less generation than they usually do in the 54 hours from 11pm Friday to 6 am Monday.  It is likely we paid around $580,000 to curtail the production (assuming $100/MWh)

TransAlta also owns the Amaranth and Wolfe Island industrial wind turbines.  Over the 54 hours the grid had to take abour 3500MWh of output from those locations.  It is likely we paid around $472,500 for this supply (assuming $135/MWh)

The average Hourly Ontario Energy Price (HOEP) was around $11/MWH over that period, so we would have paid, to only TransAlta, over $1 million more than we received when reselling the power we did actually take.

TransAlta has ownership interests in over 4000MW of coal generation capacity in Alberta.

Nuclear Units Sidelined as Demand, and Price, Drop: Week 10 Report

Week 10 reporting, for Wednesday March 7 - Tuesday March 13, has replaced week 9's figures in my version of weekly reporting.  
The record low pricing for a single day occurred on Sunday, and the weighted average price for the week, $11.74, was the lowest weekly average price since 2009.
Predictably, the depressed pricing corresponded to a record week for wind output.

The highest hourly price of the week was finally on a weekday, but at 9 pm (which means I have an error identifying evening hours as the "mid"-peak price the were, which was rational, instead of the "off" peak hours they now are - which is not)

There still hasn't been an hour, in 2012, when Ontario was a net importer of electricity.

My tools for tracking curtailed sources of power again weren't very helpful, although there was some steaming off at the Bruce B units on Sunday before Unit 8 was once again pulled offline as pricing went negative in the early afternoon.  I indicated last week that the IESO, Bruce Power, and OPG, don't announce the idling of reactors, but the evidence remains, so I have once more created a graph assuming Pickering 7 and Bruce 8 were removed from service for supply curtailment reasons, to show how much wind produced against the curtailed nuclear production.



During week 10, wind produced 182,320 MW, which was almost 100GWh more than in 2011's week 10, and demand was 144 GWh less.  Hydro and coal output were up minimally, meaning a lot of cutting to other production, or dumping, needed to be made.
Exports rose 50GWh over 2011's week 10, nuclear production dropped 87GWh (the graph showing all of that), and gas production was the big down figure, off 151GWh.

The Lies of March: ENGO’s Coordinated Dishonesty Props up McGuinty

By the end of 2014, Ontario will be the first jurisdiction in the world to replace dirty coal-fired generation with more sustainable alternatives such as wind, solar and bioenergy -- the equivalent of taking seven million cars off the road. This is the single largest climate change initiative being undertaken in North America and will lead to savings of $4.4 billion a year in health care, environmental and financial costs.

-“Ontario Shutting Down Two More Coal Units” news release, December 1, 2011

This is one of the more recent quotes deliberately attributable to the Ontario government.  Most statements regarding coal have their foundation in a document from April 2005, “Cost Benefit Analysis: Replacing Ontario’s Coal-Fired Electricity Generation,” which was prepared by DSS Management consultants.  The quoted news release displays neither an understanding of the document, nor an attempt at understanding.  The figure above includes the energy based on 2004 generation and costs - if if were possible to replace 2004’s roughly 27.6TWh of coal generation with wind turbine output, contracted at $135/MWh, the cost would be $3.725 billion, plus the significant environmental and heath costs of that source.  There are no savings even if the report is accepted as gospel.

The figure people attempting honesty quote are found in Table I-4 of the report, and that figure is roughly $3 billion a year in ‘Health Damages.’


Enter the first non-governmental tool.  Dr. - a title earned through studies in divinity, not medicine - Robert Oliphant’s letter writing campaign as President and CEO of the Asthma Society of Canada.  Rob cites a Canadian Medical Association report called “No Breathing Room” - a report which notes lots of things, but not coal.  If Oli is interested in Asthma cessaton, and not simply as a title allowing him to masquerade as a medical professional, he might want to study up on stressors of air sheds.  I’d suggest reading through the Canadian Index of Wellbeing (CIW) Environment document’s section on just that issue, where you’d find, on page 17, contaminants named PM2.5  SOx NOx VOCs, NHx, TPM and CO.  

Released in February, 2010 sector figures for these elements are available, for Ontario, from Environment Canada.  I’ve edited the fields down somewhat, and highlighted where other sectors have higher emissions, impacting air quality, than the entire electricity generation sector.

SECTORS	TPM (t)	PM10 (t)	PM2.5 (t)	SOx (t)	NOx (t)	VOC (t)	CO (t)
TOTAL INDUSTRIAL SOURCES	93,464	30,982	16,132	204,478	53,107	52,503	108,558
Electric Power Generation (Utilities)	3,306	2,736	2,120	38,448	28,130	500	13,576
Coal	1,537	1,041	529	37,433	15,828	38	4,914
Residential Fuel Wood Combustion	24,353	23,075	23,041	315	2,206	32,635	152,613
Air Transportation	342	342	334	1,963	28,499	4,300	19,843
Off-road use of diesel	7,627	7,627	7,398	67	89,056	8,244	44,364
GRAND TOTAL	3,763,345	1,132,419	239,748	268,084	396,388	3,707,483	2,359,318
WITHOUT OPEN AND NATURAL SOURCES	144,432	79,673	61,893	267,650	382,951	408,563	2,329,499
Electricity Generation % of Total Without Natural Sources	2.29%	3.43%	3.43%	14.37%	7.35%	0.12%	0.58%

The electricity sector has lower NOx emissions that the air transportation sector, and 1/3rd the emissions of the ‘off-road’ use of diesel.   At the two remaining units at Lambton, and units 7 and 8 at Nanticoke, NOx emissions were largely removed with the installation of Selective Catalytic Reduction (SCR) systems.  SOx is primarily an issue that data shows is being addressed everywhere, both in supply mixes and at the smokestack; the CIW document notes how effective existing policies have been (page 20).  

Regarding NOx, the original 2005 document actually contains a scenario for mitigation through upgrades to existing plants.  The costs of upgrades required at Lambton units 3 and 4 were minimal, as both already had both SCR systems, and scrubbers (Nanticoke 7 and 8 do not have scrubbers, but do have SCR systems).  Thunder Bay and Atikokan were excluded from the DSS report as they, “are located in an airshed with few of the sensitive receptors common in the south. For these reasons, air pollution emissions and associated health and environmental damages for these two northern stations were not included in this analysis.”  Health care costs on the only 2 units still in use at Lambton, and the Thunder Bay and Atikokan facilities, are not established, and unlikely to be significant - putting a dollar figure on shuttering the facilities is not honest.

Environmental Defence went further than writing local papers in inviting people to add their name to a canned letter equating the shutting down of “dirty coal plants” with wind turbines, and the David Suzuki foundation directs people to Environmental Defences’ site in claiming that, “ just two years, the GHG emissions from Ontario's electricity production fell by more than half. ..”  The implication is that wind turbines have contributed to the reduction in coal.  Aside from not being true, it’s the opposite of true at times.  As high winds brought high temperature last Friday in Ontario, first the Bruce 8 nuclear reactor was taken offline, and then, on Saturday, Pickering unit 7 was removed.  When the wind died and temperature dropped for Sunday and Monday (the highest demand in 6 weeks), the 1400MW of idled nuclear production was met with coal.  Coal production was displaced by the return of nuclear units from 2002-2005, and since then primarily by natural gas.  In 2006 about 35.4 TWh were produced by either coal or gas - in 2011 that figure was reduced to 33.1TWh, but a drop in demand of 9.6TWh accompanied the 2.3TWh drop in coal/gas generation.

The truth is wind cannot replace coal, and everybody knows it.  Environmental Defence, Suzuki, the World Wildlife fund (WWF-Canada also had a campaign against rural power in siting industrial wind), and Greenpeace didn’t need a campaign, already having a man inside the legislature displacing the remnants of socialism in the rudderless NDP.

When Peter Tabuns spoke against observing rural concerns with industrial wind in Ontario, he did so by citing a French study which showed a link between nuclear plants and childhood leukaemia - a study based on 14 children having the disease, when only 7 would be expected.  The study wouldn’t be significant, except for corroborating an earlier study in Germany with other minor percentage differences (but discredited because of claims there was one data cluster distoring all the data), and one in the UK … the one in the UK they don’t talk about much as the character of the people drawing wild conclusions from indeterminate statistics was revealed by George Monbiot, after the mistakes of the methodology were revealed by others.

Nonetheless, at least Tabuns touched on the real agenda of all the groups listed - most heavily financed by those who will profit from the displacement of the large hydro, and nuclear, projects that tend to be publicly owned.

Ontario’s rural residents deserve a more serious discussion on their ability to have meaningful input on the forced industrialization of their communities.
Wind cannot displace coal, and coal generation isn’t generating the medical costs being claimed.

---

 Appendix: 2011 Coal Figures (estimated from IESO Hourly Output and Capability reporting).

2011 Ontario Coal Generation Estimates
Source	Produced	Capacity	Capacity Factor
LAMBTON-G3	611,862	475	14.7%
LAMBTON-G4	615,074	475	14.8%
ATIKOKAN-G1	61,948	211	3.4%
THUNDERBAY-G2	3,042	153	0.2%
THUNDERBAY-G3	115,169	153	8.6%
NANTICOKE-G7	518,372	480	12.3%
NANTICOKE-G8	637,962	480	15.2%
NANTICOKE-G6	460,717	460	11.4%
NANTICOKE-G5	407,211	460	10.1%
NANTICOKE-G1	293,272	440	7.6%
NANTICOKE-G2	365,121	440	9.5%
TOTAL	4,089,750	4,227	11%