Ontario Phasing Out Coal
January 21, 2013
A few reactions. Ontario is blessed with a large hydro capacity,which is a perfect match for variable resources coming on line. A big reason for the change is the current low prices for gas generation, and there are large question marks as to what the real greenhouse contributions of the natureal gas infrastructure are.
Still, phasing out coal, which accounted for 25 percent of generation, is a real achievement, and was one of the goals of energy legislation that set up feed-in-tariffs to encourage renewable development in the province. Modeled after Germany, this is, to my knowledge, this is the most aggressive and successful program in North America.
By the end of the year, Ontario will become the first jurisdiction in North America to shut down almost its entire coal fleet.
Yesterday, the province announced that its last two large coal units will close before 2014, making more than 99 percent of the province’s electricity generated from non-coal sources. It is a major shift for Ontario, which fired 25 percent of its grid from coal a decade ago.
To prepare for the coal phaseout, McGuinty introduced an aggressive energy law in 2009 establishing energy efficiency programs and a feed-in tariff providing generous financial benefits to renewable developers. Those efficiency programs have helped make Ontario one of the few jurisdictions in the world where energy demand is declining, rather than increasing, Weis said.
“This shows it is possible to do this in a jurisdiction with big electricity consumption,” he said.
The 2009 law has not been without controversy — and was recently challenged before the World Trade Organization — but it has boosted the ability of renewable power to step in for coal, according to Weis.
Wind power has grown from 400 MW of provincial power six years ago to more than 2,000 MW now. By 2030, it is projected to provide roughly 10 percent of the province’s electricity supply, despite having been a non-player in 2003.
Additionally, new natural gas plants are supplying much of the power formerly provided from coal generation, Weis said.
According to the Pembina Institute, the greenhouse gas emissions from Ontario’s electricity sector have fallen from 40 million tons to 10 million tons over the past decade because of the coal plant closings.
Ontario introduced the Renewable Energy Standard Offer Program on November 22, 2006 with the intent of stimulating growth in the development of renewable energy in the province. The program exceeded expectations with 1400MW of contracted projects since its inception.7
On May 14th, 2009 Ontario passed into law the Green Energy and Green Economy Act, 2009. The act is intended to help phase out the last coal generation in Ontario and boost the economy. The act is also intended to stimulate research into renewable technologies and create environmentally friendly industry and jobs.8 It is important to note that the Ontario FIT provided a small but notable additional incentive for Native groups to propose projects. It also included a requirement of certain percentages of renewable energy equipment had to be purchased from Ontario companies. The goal was to create a strong Ontario renewable energy industry.
When Ontario’s Feed-in tariff program was one year old, there was some journalistic coverage of how successful it had been. It seems to have been incredibly successful, with many projects waiting in the queue for transmission line space to be built. Tens of thousands of proposals are for rooftop solar, but this represents only a small portion of the proposed power production. It is expected that this aggressive policy is bringing many jobs to Ontario. People have been complaining, often comparing the electricity rates for green power to the rates they have paid in the past. As this reporter correctly points out: that is the wrong question to ask. The right question to ask is how they compare to the rates that Ontario is paying for its current power, and what it will be paying for power in the near future.