Here is a short discussion of Ontario’s electricity exports from an interview on CFRA Radio (Ottawa) with host Steve Madely broadcast on January 11, 2011 at 7:45 am. Subjects addressed include factors causing rising power prices, the future of electricity demand in Ontario, and the absence of rational power planning.
Here is another radio interview on electricity exports. The host is Jeff Allan on 570News (Kitchener). The guests are me, the NDP Energy Critic Peter Tabuns, and finally Energy Minister Brad Duguid.
Suppliers want long term contracts so there’s very little Ontario Hydro can do to prevent the surplus situation from arising when they have to predict how much power they’ll need several years in advance.
Green power like solar and wind is not expensive when compared to other sources. For example.
Wind: 8MW for $25 million equals $3.12 million per megawatt of generating capacity.
Nuclear: 2400MW for $26 billion equals $10.83 million per megawatt of generating capacity.
Rob,
My argument is that it is crazy to be buying more short lead-time supplies while we are in surplus and while market prices make filling gaps cheap. I don’t think there is any reason to debate solar generated electricity as cost effective for grid supply our part of the world with existing technology. Land-based wind power at the best sites and competitively procured is conceivably cost-effective against other costly supply options. However, wind power is not currently competitive against new gas-fired generation. The nuclear cost you present is for a pair of new ACR reactors from AECL. I don’t think ACR has any credibility.
If wind is so cheap, why are we paying so much for it in Ontario ? Prices were set too high to begin with, FX and equipment costs have come down, there’s now no competitive procurement of renewable supply process and micro-Fit is like backyard steel mills — good politically but something that was tried before and failed. Yes, new/refurbished nuclear will be expensive but at least it’s firm. Wind runs about 28 – 35 % of the time. If you adjust the capital costs using load factors, i.e. look at things on a delivered energy basis, the capital costs you present are in fact similar.
“Wind runs about 28 – 35 % of the time”
No, wind on average produces 20-30% of nameplate capacity, which is not the same thing as producing 20-30% of the time.
Capacity factor is not well understood.
Anyway, wind turbines are not dispatchable, nor can they reliably produce base load electricity; hence, they’re useless.
The province should be scrambling right now to replace or refurbish the base load reactors which will be be retired within the next 10-15 years; instead, they’re destroying the grid’s safety net (coal) and building unreliable wind/solar farms.
J,
Your comments on wind power’s capacity factor are well taken, but I would not conclude that its intermittent output makes it useless. The value of wind power is a function of what it is replacing on the grid. Run of river hydro-electric is somewhat intermittent too, and like wind many r-of-r hydros produce little in summer but some are quite valuable. Regarding your recommendation about refurbishing old nukes, we did that at Pickering A and have a chance to see the results. The 3 year average operating costs alone of Pickering A — ignoring the skyhigh capital costs — for the period 2006-2008 were $92.27/MWh according to OPG’s analysis. Bruce Power and NB Power are in the midst of repeating the Pickering A refurbishment experience. Candu is dead. We need to move on.
“Land-based wind power at the best sites and competitively procured is conceivably cost-effective against other costly supply options. However, wind power is not currently competitive against new gas-fired generation.”
Is the current price of natural gas really sustainable?
J,
Natural gas can be purchased on long contracts at attractive prices, but history is loud and clear that gas prices often experience massive spikes. I think gas should only be used as a stop gap until we come up with something better. However, right now gas is so attractive that it gives us breathing room to stop and think.
Thanks for responding.
If Candu is dead, what form of generation should replace the current base load reactors?
Are other nuclear reactor designs more economical than AECL’s CANDU design?
Do you think there’s any chance that coal will become an option again? (after the current government loses the next election?)
In the long run I believe that gas is a very poor option since it’s an our best source of instant heat and we use it as a feedstock for nitrogen fertilizers, certain petrochemicals, etc. I would rather see the province offer rebates for switching large heating loads from electricity to gas where applicable than building more inefficient (30-55% VS 80-95% for direct heat applications) gas fired plants – ex: water heaters, stoves, manufacturing processes.
I know that North America has a lot of shale gas but I’m skeptical of the long term economic/supply viability of the resource.
J,
Ontario has enormous intellectual capacity with respect to nuclear technology. It would be a good idea to unshackle that capacity from the Candu nationalist dead-end and apply our brain power to figuring out what the best technologies and partners are. I’d like to see the top nuclear brains at OPG given the job of performing a comprehensive compare and contrast analysis of the nuclear options, putting all their analysis to the public so the best nuclear options can be ranked against non-nuclear alternatives.
Historically, Ontario Hydro demonstrated technical leadership capacity. Examples include the development of the 500 KV transmission system and the conversion of Nanticoke from a baseload bituminous coal plant to a peaking plant run largely on Powder River basin sub-bituminous.
I share your skepticism with respect to gas for power. My own view is that gas should be a short term stop gap. The cost of scrubbed coal power seem pretty attractive for the long term.
To be fair, the same document shows Darlington at $30/MWh – and everybody has agreed Pickering is in its last stretch (they did do a great job of getting through the vacuum building outage in 2010).
Scott,
I agree that OPG should get some credit for the recent Pickering vacuum building outage and maybe also for the Pickering 2/3 safe store project, but in the scheme of things those are pretty small potatoes. The vac building outage is a routine event and OPG shouldn’t expect too many high fives for doing their day jobs.
Darlington looks good relative to all the other Canadian Candu plants but it looks middling at best relative to the US fleet and has the benefit of a relatively young age. Unlike U.S. reactors, the Candu ages gracelessly. If history is any guide, Darlington’s best days are just about over.
One observation that leaps out from the Candu benchmarking data we now have is the wisdom of not attempting to refurbish Pickering B. OPG and the government made the right decision on that one and deserve full credit. Those still clambering for Pickering B refurb are either ignorant or deliberating advocating against the interests of consumers. The Power Worker’s Union belong in the later category.
Technology aside, maybe some credit for the recent performance should be given to simply doing some benchmarking.
I thought it was broadly established that Pickering would be phased out – and the role of it is now to function to replace other reactors as they are refurbished. I also thought it was fairly clear, despite the best efforts of some, such as Tabuns and Gibbons, the Darlington’s reactors would be refurbished as it has had a good run since finally being completed.
The one I’ve always felt is vague is Bruce B. I thought the CNSC had demanded end-of-life plans for it after granting the last 5-year license. I don’t expect to see much on that until the outcome of 1 and 2 is known, so I guess we wait a year to know if CANDU will see one more refurbishment, or is done for good already.
There must be a lot more to the Bruce and AECL stories.
Don’t praise OPG too much for doing nuclear benchmarking, because OPG was order to do it by the OEB in EB-2007-0905, issued in November 2008.
McGuinty has ordered Darlington refurbished, but there are many reasons for concern. There are no visible signs that any consideration was made of the refurb disasters at Pickering A, Point Lepreau, and Bruce Power. OPG has published feasibility studies on the refurbishment which claims over 95% certainty that the cost of power from the refurbishment investment will not exceed 8 cents/kWh. However, OPG admits that the scope of the refurbishment is not yet fully established, OPG assume no inflation adjusted escalation of operating costs, and OPG assumes a long service life at very high capacity factor.
The extension of Pickering B, which OPG suggests may run until 2020, is subject to fitness for service assessments of equipment like pressure tubes. We won’t know which drop of juice is the last drop squeezed from that lemon until after it has been delivered.
I would like to see AECL’s future decided to remove the shackles from Ontario’s nuclear future and allow the province to find the best technology solution for its nuclear future; China seems to be the lead for continued CANDU use given its ability (free from non prolif. treaties) to recycle fuel for use in their CANDU units thus maximizing used fuel from other reactor designs. I still see a niche market for CANDU just not in Canada right now. If Ontario has truly said goodbye to its manufacturing economy, mixed use energy options seem like a good idea; but consumers won’t be happy to pay for the true cost without OPG subsidizing rates.
Ronald,
Ontario should not sole source any element of its power system. It is hard to believe that some organization can, with a straight face, make a case for sole sourcing our nuclear future. Regarding Candu in China, the Chinese government clearly told us in 2005 that there will be no more Candus in China for the foreseeable future. Since 2005, the Chinese have voted with their dollars in EPR, AP 1000 and others but not Candu. I think Ontario power consumers have taken on so many burdens, particularly recently, that there is no way they can absorb covering the costs of AECL too. When the rest of Canada was shouldering most of AECL’s costs, it was much more affordable for Ontario consumers.