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        Leaked Ontario Energy Plan Will Take A Lot of Prep To Pay Off

 

By Terry Chu

A recently leaked Ontario cabinet document has laid out a draft long-term energy plan for the province.

The draft plan, scooped by the Globe and Mail, was met with a both praise and condemnation, depending largely on which side of what economical and political interests one held.  The Globe’s own righteous defender of the beleaguered status quo, Margaret Wente, calls the plan “nutty” and “wrought by folks who evidently never met an engineer.” 

“It’s hard to pick out one wrong thing with this” criticism - (unlike Ms. Wente, I will quote when I lift verbatim) - because it is all just so hand-wavy, and actually references frolicking unicorns. 

As an engineer in the energy sector, I did economic feasibility after economic feasibility study for municipalities interested in building district energy systems.  Seldom were we able to make an economic case for reducing fossil fuel consumption. Why? Fossil fuels were simply too cheap. 

For the uninitiated, direct energy systems are massive networks of underground water pipes that deliver hot and cold water for space heating and cooling (and domestic hot water heating).  District energy generally uses natural gas as its primary heat source, but can also make use of ground source heat pumps, solar thermal heating, absorption chilling, and the crown of Toronto’s energy system, deep lake water cooling. 

Deep lake water-cooling is of particular importance since Toronto’s mass condo boom never really considers the energy needs of the city.  As more and more condos are built, the energy required to feed them will stretch the capacity of Toronto’s two existing transmission lines.  During the hottest days of the year when everyone has their air conditioners on, the grid is so overloaded that line loss can be as much as a quarter of all electricity transmitted.  The lines get “hot” and not only are they inefficient, they can physically sag.  For those of us around during the great black out of 2003, it was exactly this kind of scenario that caused the power failure.

The ability to reduce electricity demand would seem like a prudent long-term investment, except future costs (and blackouts) are seldom the problem of those currently sitting in office. 

District energy systems are expensive, and the ability to attract private investment is limited since it is notoriously difficult to retrofit old buildings to be district energy compatible.  Without an existing stock of potential customers, investments in underground pipes aren’t the best use of monetary resources.  Some cities demanded that all new buildings be compatible for future district energy connections.  This doesn’t work in Ontario since demanding developers go above and beyond building code is just asking for an OMB challenge.  You would think that developers would think long term and build so that someday, they can save energy costs. The problem with that is that builders are seldom the owners of the buildings.  Once the building is developed, they walk away and don’t really care about operating costs. 

Phasing out individual buildings from being heated directly with natural gas opens the door for district energy systems to be built all across the province.  Individually, homeowners can’t efficiently make use of geothermal systems, biomass sources, or thermal storage.  Inside a big system, it suddenly makes sense to invest in solar thermal arrays when the costs can be shared over many users.  Building these systems will create jobs in the province and reduce our dependency on natural gas from Alberta and the United States.  It trains skills locally without draining our pockets to transfer funds out of the province to pay for resources we aren’t producing ourselves.  So while fossil fuels companies will get a kick in the pants, trades, clean tech firms and our secondary economy will get a boost. 

Upping electric vehicle sales to 5% by 2020 could be ambitious.  If every block had just one electric car on it, the increased demand could blow up the grid.  The infrastructure will need a lot of beefing up between here and there to get more of them on the road.  From a greenhouse gas (GHG) reduction perspective, I’m also on the fence about them.  About 30% of Ontario’s grid is still serviced by natural gas.  Unless the cars can be guaranteed to be only charged at night, we can assume the marginal kilowatt (kW) is from non-green sources.  Does it make sense to burn a fossil fuel, lose about two-thirds of the energy in the process, turn it into electricity, lose some more during the transmission, and then use it to power a vehicle? 

There will be a lot of work that needs to be done to make the grid smarter before electric vehicles (EVs) can be adopted in an efficient manner.  Charging stations will need to be very discerning as to when they provide the power.  There are technologies being developed to make this possible but our ever so slowly moving behemoths of utilities could be decades in adopting them.  Energy Minister Glen Murray will need to make sure the grid is ready before pushing EVs - otherwise they won’t really be as green as he’d like to think they are.  Preparing the grid needs to become a priority. 

Other aspects of the leaked plan include R&D funding, GO transit funding, tax breaks for buying more energy efficient machines and other fairly innocuous items that not even Ms. Wente could spare the ink to criticize. 

On the surface these plans are at least logical, but the devil is in the details. 

Overall, while some market segments will inevitably be hurt, I have little doubt there will be fantastic growth in other sectors.  Chicken Little screaming about job losses and that the sky is falling reminds me of an urban planner who argued against public transportation claiming it was less environmentally friendly than driving. The argument went like this: Americans (this was an American study) live in big houses and sparse neighbourhoods and bus service is infrequent so few people take them.  As a result, on average, buses are near empty in many suburbs.  The average bus emission per rider is higher than if those poor people drove themselves in their own cars.  Therefore, building public transit is misguided. 

His argument neglected the fact that houses would be in denser neighbourhoods, condos would be built, subways move people more efficiently, and higher density neighbourhoods mean more frequent buses and higher concentration of riders.  The planner took data from a priori conditions, and applied those stats to a completely new model where the assumptions were no longer valid.

Yes, in the snapshot of today’s economy, there will be changes, but that doesn’t mean all those changes will result in us living in destitution.  We don’t know how those changes will shape the future economy. But what I do know is that to do nothing, as Ms. Wente suggests, will also do little to help us pay for the reconstruction of places already affected by climate change. 

Alberta is smoldering while we bicker.  It’s time to take action.

 

 

Posted date : June 09, 2016
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