november 6, 2012
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November 6, 2012. Outlook for Electricity Demand and Supply in Ontario Amir Shalaby, VP Power System Planning APPrO 2012 Conference. Providing context for discussions at this conference. Electricity demand and supply The cost of electricity service - PowerPoint PPT PresentationTRANSCRIPT
November 6, 2012
Outlook for Electricity Demand and Supply in Ontario
Amir Shalaby, VP Power System Planning
APPrO 2012 Conference
2APPrO 2012 – presented by Amir Shalaby – OPA
Providing context for discussions at this conference
• Electricity demand and supply
• The cost of electricity service
• Strategies for operating a changing supply mix
• Planning priorities
3APPrO 2012 – presented by Amir Shalaby – OPA
Higher efficiency in electricity use
Historical Projected
Source: IESO/OPA
Ontario GDP
Energy Per Capita
Population
4APPrO 2012 – presented by Amir Shalaby – OPA
02,0004,0006,0008,00010,00012,00014,00016,00018,00020,00022,00024,00026,00028,00030,000
0
20
40
60
80
100
120
140
160
180
200
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Peak
Dem
and
(MW
)
Ener
gy C
onsu
mpti
on (T
Wh)
Ontario electricity demand is declining
Historical Projected
Source: IESO/OPA
Peak Demand
Energy Consumption
5APPrO 2012 – presented by Amir Shalaby – OPA
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2005 2012
Inst
alle
d Ca
paci
ty (M
W)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables Demand Response
Capacity transformation over the past seven years
Source: IESO/OPA. Figures have been rounded.
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2005 2012
Inst
alle
d Ca
paci
ty (M
W)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables Demand Response
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2005 2012
Inst
alle
d Ca
paci
ty (M
W)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables Demand Response
7,600
10,900
4,900
8,100
31,600 MW
10,000
8,400
3,000
670
38,300 MW
12,900
3,300
100
4,300 MW 2,000 MW
5,100 MW
300 MW2,900 MW
670 MW
6APPrO 2012 – presented by Amir Shalaby – OPA
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2005 2012 2015
Inst
alle
d Ca
paci
ty (M
W)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables Demand Response
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2005 2012 2015
Inst
alle
d Ca
paci
ty (M
W)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables Demand Response
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2005 2012
Inst
alle
d Ca
paci
ty (M
W)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables Demand Response
Transformation continues to 2015
7,600
10,900
4,900
8,100
31,600 MW
10,000
8,400
3,000
670
38,300 MW
12,900
3,300
3,300 MW
100
4,300 MW 2,000 MW
5,100 MW
300 MW2,900 MW
670 MW
12,900
9,300
8,900
8,700
700
40,500 MW
700 MW 500 MW5,700 MW
30 MW
Source: IESO/OPA. Figures have been rounded.
7APPrO 2012 – presented by Amir Shalaby – OPA
0
20
40
60
80
100
120
140
160
180
0
20
40
60
80
100
120
140
160
180
2005 2012
Ener
gy P
rodu
ction
(TW
h)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables
Coal is replaced by other energy sources
30
79
12
156 TWh
3
35
7
152 TWh
85
27 TWh 6 TWh10 TWh
1 TWh 6 TWh34
22
1
Source: IESO/OPA. Figures have been rounded.
8APPrO 2012 – presented by Amir Shalaby – OPA
0
20
40
60
80
100
120
140
160
180
0
20
40
60
80
100
120
140
160
180
2005 2012 2015
Ener
gy P
rodu
ction
(TW
h)
Coal Nuclear Natural Gas Hydro Non-Hydro Renewables
Gas will be replaced by other sources going forward
30
79
12
156 TWh
3
35
7
152 TWh
85 93
9
38
18
158 TWh
27 TWh 6 TWh10 TWh
1 TWh 6 TWh 3 TWh
8 TWh
13 TWh 3 TWh 11 TWh
34
22
1
Source: IESO/OPA. Figures have been rounded.
9APPrO 2012 – presented by Amir Shalaby – OPA
0
5
10
15
20
25
30
35
0
5
10
15
20
25
30
35
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Gree
nhou
se G
as E
miss
ions
(Meg
aton
nes)
Greenhouse gas emissions are much lower
Historical Projected
Source: OPA
10APPrO 2012 – presented by Amir Shalaby – OPA
Providing context for discussions at this conference
• Electricity demand and supply
• The cost of electricity service
• Strategies for operating a changing supply mix
• Planning priorities
APPrO 2012 – presented by Amir Shalaby – OPA11
i. Electricity (generation and conservation)
ii. Delivery (transmission and distribution)
iii. Regulatory (Wholesale Market Services)
iv. Debt Retirement
PLACEHOLDER
The residential customer sees four categories on their electricity bill
Residential Electricity Bill
Debt Retirement
Regulatory
Electricity
Delivery
12APPrO 2012 – presented by Amir Shalaby – OPA
$0
$5
$10
$15
$20
$0
$5
$10
$15
$20
2011
Tota
l Cos
t (20
12 $
Bill
ions
)Electricity is the largest of the four components and will increase the most over time
Source: OPA
Electricity
Debt Retirement
Delivery
Regulatory
electricity service
13APPrO 2012 – presented by Amir Shalaby – OPA
$0
$5
$10
$15
$20
$0
$5
$10
$15
$20
2011
Tota
l Cos
t (20
12 $
Bill
ions
)Global Adjustment is a way of developing required resources
Global Adjustment
Market Revenues
Source: OPA
Electricity
Debt Retirement
sources of revenue to generators/conservation
electricity service
Delivery
Regulatory
14APPrO 2012 – presented by Amir Shalaby – OPA
$0
$5
$10
$15
$20
$0
$5
$10
$15
$20
2011
Tota
l Cos
t (20
12 $
Bill
ions
)Contracts for conservation and generation drive Global Adjustment
Generation
Conservation
Global Adjustment
Market Revenues
Source: OPA
Electricity
Debt Retirement
sources of revenue to generators/conservation
products procured
electricity service
Delivery
Regulatory
15APPrO 2012 – presented by Amir Shalaby – OPA
$0
$5
$10
$15
$20
$0
$5
$10
$15
$20
2011
Tota
l Cos
t (20
12 $
Bill
ions
)Three organizations use Global Adjustment
Generation
Conservation
Global Adjustment
Market Revenues
OPA
OPG
OEFC
Source: OPA
Electricity
Debt Retirement
sources of revenue to generators/conservation
contracting/operating entity
products procured
electricity service
Delivery
Regulatory
16APPrO 2012 – presented by Amir Shalaby – OPA
$0
$5
$10
$15
$20
$0
$5
$10
$15
$20
2011
Tota
l Cos
t (20
12 $
Bill
ions
)To enable electricity policy objectives
Generation
Conservation
Global Adjustment
Market Revenues
OPA
OPG
OEFC
RenewablesNatural
Gas.
Nuclear
Source: OPA
Conservation
Electricity
Debt Retirement
sources of revenue to generators/conservation
contracting/operating entity
supply mix procured
products procured
electricity service
Delivery
Regulatory
APPrO 2012 – presented by Amir Shalaby – OPA
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
$3.0
$3.5
0
10
20
30
40
50
60
70
Energy Production (Savings) in 2011 (TWh) Global Adjustment in 2011 (2012 $ B)
OPA
Glo
bal A
djus
tmen
t (2
012
$ Bi
llion
s)
Prod
uctio
n fo
r OPA
Con
tract
ed Fa
ciliti
es (T
Wh)
In 2011, the OPA procured 60 TWh supported by Global Adjustment
17
Nuclear
Natural Gas
Wind
SolarBio & Hydro
Conservation
Source: OPA, *Based on annualized energy savings.
$26/MWh
$54/MWh
$74/MWh$466/MWh$62/MWh
Global Adjustment Unit Cost
Nuclear
Natural Gas
WindSolar
Bio & Hydro Conservation
$30/MWh*
APPrO 2012 – presented by Amir Shalaby – OPA
$0
$10
$20
$30
$40
$50
$60
$70
$0
$10
$20
$30
$40
$50
$60
$70
Jan-
10Fe
b-10
Mar
-10
Apr-
10M
ay-1
0Ju
n-10
Jul-1
0Au
g-10
Sep-
10O
ct-1
0No
v-10
Dec-
10Ja
n-11
Feb-
11M
ar-1
1Ap
r-11
May
-11
Jun-
11Ju
l-11
Aug-
11Se
p-11
Oct
-11
Nov-
11De
c-11
Jan-
12Fe
b-12
Mar
-12
Apr-
12M
ay-1
2Ju
n-12
Jul-1
2Au
g-12
Sep-
12
Aver
age
Unit
Cost
($/M
Wh)
Illustration of the effect of High Five participation on Global Adjustment allocation
Source: IESO and Market Surveillance Report
Same Global Adjustment for all customers Post Jan 1, 2011
Class B Global Adjustment Rate
Class A Average Global Adjustment Rate
All Customers
18
19APPrO 2012 – presented by Amir Shalaby – OPA
Impact on specific consumers depends on a number of factors
Load Shape
Distribution System
Rate Structure (Retail, TOU, Tier
Rates)
Transmission & Connection
Energy Credits (Northern, Low
Income/Seniors)
High Five Participation
20APPrO 2012 – presented by Amir Shalaby – OPA
Providing context for discussions at this conference
• Electricity demand and supply
• The cost of electricity service
• Strategies for operating a changing supply mix
• Planning priorities
21APPrO 2012 – presented by Amir Shalaby – OPA
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
2013 2014 2015 2016 2017 2018 2019 2020
Capa
city
Con
trib
ution
at T
ime
of P
eak
(MW
)
Options To Be Determined Demand Response Other Renewables Hydroelectric Natural Gas Nuclear Coal
Capacity surplus disappears post-coal closure
Ontario Peak Demand + Reserve
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2013 2014 2015 2016 2017 2018 2019 2020
Capa
city
Con
trib
ution
at T
ime
of P
eak
(MW
)
Demand Response Non-Hydro Renewables Hydroelectric Natural Gas Nuclear Coal Options To Be Determined
Source: OPA
22APPrO 2012 – presented by Amir Shalaby – OPA
0
20
40
60
80
100
120
140
160
180
0
20
40
60
80
100
120
140
160
180
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Ener
gy P
rodu
ction
(TW
h)
Coal Nuclear Natural Gas (Including Imports) Hydroelectric Non-Hydro Renewables
Energy supply mix objectives will be achieved by 2015
0
20
40
60
80
100
120
140
160
180
0
20
40
60
80
100
120
140
160
180
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Ener
gy P
rodu
ction
(TW
h)
Non-Hydro Renewables Hydroelectric Natural Gas (Including Imports) Nuclear Coal
Source: IESO/OPA
23APPrO 2012 – presented by Amir Shalaby – OPA
0
10
20
30
40
50
60
70
80
90
100
0
10
20
30
40
50
60
70
80
90
100
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Nuc
lear
Pro
ducti
on (T
Wh)
Darlington Bruce Pickering
Nuclear capability restored
Bruce
Darlington
Pickering
Source: IESO/OPA
APPrO 2012 – presented by Amir Shalaby – OPA
Strategies are available for operating a changing supply mix, integrating renewables
What does a changing supply mix
impact?
Regulation
Operating Reserve
Ramping & Load
Following
Potential Surplus Energy
24
25APPrO 2012 – presented by Amir Shalaby – OPA
0
20
40
60
80
100
120
140
160
180
200
2013 2014 2015 2016 2017 2018 2019 2020
Ener
gy P
rodu
ction
(TW
h)Energy production capability
26APPrO 2012 – presented by Amir Shalaby – OPA
0
20
40
60
80
100
120
140
160
180
200
2013 2014 2015 2016 2017 2018 2019 2020
Ener
gy P
rodu
ction
(TW
h)Ontario production capability is expected to exceed Ontario Demand to 2020
Ontario Energy Demand
27APPrO 2012 – presented by Amir Shalaby – OPA
0
20
40
60
80
100
120
140
160
180
200
2013 2014 2015 2016 2017 2018 2019 2020
Ener
gy P
rodu
ction
(TW
h)Potential Surplus Energy (PSE) arises when energy production capability > Ontario demand
Ontario Energy Demand
Potential Surplus Energy
APPrO 2012 – presented by Amir Shalaby – OPA
0
2
4
6
8
10
12
14
16
18
20
2013 2014 2015 2016 2017 2018 2019 2020
Pote
ntial
Sur
plus
Ene
rgy
(TW
h)Potential Surplus will increase in the near-term
28
APPrO 2012 – presented by Amir Shalaby – OPA
0
2
4
6
8
10
12
14
16
18
20
2013 2014 2015 2016 2017 2018 2019 2020
Pote
ntial
Sur
plus
Ene
rgy
(TW
h)Most of PSE is and will continue to be exported
Exports
29
30APPrO 2012 – presented by Amir Shalaby – OPA
-5
0
5
10
15
20
25
2005 2006 2007 2008 2009 2010 2011
TWh
Imports Exports Net Exports
Ontario has recently become a net exporter of around 10 TWh per year
Source: IESO
APPrO 2012 – presented by Amir Shalaby – OPA
0
2
4
6
8
10
12
14
16
18
20
2013 2014 2015 2016 2017 2018 2019 2020
Pote
ntial
Sur
plus
Ene
rgy
(TW
h)Other measures are available beyond exports
Hydro spill, renewables dispatch, and nuclear maneuvering/outages
31
Exports
32APPrO 2012 – presented by Amir Shalaby – OPA
Providing context for discussions at this conference
• Electricity demand and supply
• The cost of electricity service
• Strategies for operating a changing supply mix
• Planning priorities
33APPrO 2012 – presented by Amir Shalaby – OPA
Emerging from the outlook are a few planning priorities
Near-Term(2013-2015)
Long-Term(2023+)
Evolution of conservation/FIT
Renewables integration
Regional plans
Capability of existing nuclear fleet
Supply mix scenarios
End-use standards
Long-term infrastructure
planning
Mid-Term(2016-2022)
Resource options if needed: conservation,
gas, imports, or renewables
34APPrO 2012 – presented by Amir Shalaby – OPA
Restoring nuclear: done for the near-term, but what about the longer term?
Source: OPA
Development of Coordinated
Plan
Financing
Options
Present Future
Regulatory/Contractual
Terms
Operational and Technical Coordination
0
20
40
60
80
100
120
140
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Annu
al P
rodu
ction
(TW
h)
Inst
alle
d C
apac
ity (M
W)
MW TWh
35APPrO 2012 – presented by Amir Shalaby – OPA
Highlights (left with you in 2010)
• Efficiency more than offsets growth in population/economy
• Adequate resources to at least 2015 and beyond depending on new commitments and on nuclear availability
• Additions of intermittent generation in the mid-term requires: new transmission, new operating rules and protocols, contract administration, facility operations, and ancillary service planning
• Regional reliability focus will be on: GTA, KWCG, Northwest
• Planning for nuclear refurbishments is a current priority for post-2015 time period
Thank you.