Opportunities for Distributed Generation in Canada
Total Page:16
File Type:pdf, Size:1020Kb
OPPORTUNITIES FOR DISTRIBUTED GENERATION IN CANADA Ganesh Doluweera, Director of Research Webinar April 21, 2020 Choose one of the following for audio: • Mic & Speakers to use VoIP • Telephone and dial: Flagship Sponsor • CANADA: 1-647-497-9385 • US: 1-213-929-4231 • ACCESS CODE: 246-506-339 www.ceri.ca WEBINAR PARTICIPATION Audio Your microphone has been muted for the duration of this presentation. To hear webinar audio: . Choose Mic & Speakers to use VoIP . Choose Telephone and dial using the information provided: . CANADA: 1-647-497-9385 . US: 1-213-929-4231 Allan Fogwill . ACCESS CODE: 246-506-339 Questions . Please submit your text questions and comments using the Questions panel. Questions will be answered during the Q&A period following the presentation. Note: A copy of this presentation can be downloaded by selecting the document in the Handouts panel. 2 CANADIAN ENERGY RESEARCH INSTITUTE Overview Founded in 1975, the Canadian Energy Research Institute (CERI) is an independent, registered charitable organization specializing in the analysis of energy economics and related environmental policy issues in the energy production, transportation, and consumption sectors. Our mission is to provide relevant, independent, and objective economic research of energy and environmental issues to benefit business, government, academia and the public. CERI publications include: • Market specific studies • Geopolitical analyses • Quarterly commodity reports (crude oil, electricity and natural gas) In addition, CERI hosts a series of study overview events and an annual Petrochemicals Conference. 3 CORE FUNDERS FUNDING SUPPORT IVEY S.M. BLAIR FAMILY FOUNDATION FOUNDATION IN-KIND SUPPORT Alberta Energy Regulator | Bow Valley College | CEPA Foundation JWN Energy | Northern Alberta Institute of Technology Petroleum Services Association of Canada AGENDA • Introduction • Study Scope & Objectives • Data and Methods • Results (Preliminary) • Observation 5 Introduction • Rapid growth in the integration of distributed energy resources (DER) is one of the most significant and important trends in the electricity industry around the world • DER encompasses electricity generation systems, storage systems, and controllable loads that are connected to the distribution system at or closer to final consumers of electricity • Distributed generation (DG) is a major and one of the well understood DER • Interest on DG is not new – has been there (at least) for the past few decades • In Canada, DG technologies are being promoted as a complementary policy tool to achieve energy and environmental goals • However, higher integration of decentralized generation systems will bring challenges • The trade-offs of DG need to be assessed and quantified. 6 Distributed Generation - Definition 1) Electricity generation at distribution system levels • Smaller nameplate capacity (between 1kW and 15MW ) • Backup generator for an airport is about 4MW and 5MW 2) The generating system is located near or at the point of consumption 3) The output (electricity generation) is used to meet all or at least a fraction of the electricity needs of a house or small business 4) Makes use of technologies that rely on locally extracted primary energy resources (wind, solar, hydro, biomass, or geothermal) 7 Perceived Benefits of DG 8 Study Scope and Objectives Our study has three main objectives: The study is currently in progress and this webinar will review some of the results 9 Review of DG Policies and Programs 10 Provincial DG Programs • A common drivers: • Climate policies • Promotion of renewable energy • Supporting local economies • Enhanced electricity access • Differs by: • Technology choice • Formal procurement programs (or lack thereof) • Compensation mechanism (e.g., Fixed feed in tariff, net energy metering, net billing) 11 British Columbia DG Policies • Net Metering Program (2004) • Initial limit of 50kW – increased to 100kW in 2008 • Standing Offer Program – SOP (2008) • Systems with nameplate capacity between 100kW and 15MW • Participants are compensated through Electricity Purchase Agreements • Micro-SOP (2014) • Targeting First Nation’s communities (between 100kW and 1MW) • The First Nation community needs to keep at least 50% ownership • Compensated through Electricity Purchase Agreements 12 British Columbia Results • As of 2019, more than 1800 customers in the Net Metering Program • Installed capacity of about 13MW • 98% are using PV systems • As of 2018, there were about 170MW contracted under the SOP and Micro-SOP programs • The initial target for the SOP program was 100MW • SOP and Micro-SOP have now been cancelled over concerns on the impacts on electricity rates • BC Hydro applied to the BCUC to amend the Net Metering Program to limit the max capacity of DG 13 Alberta DG Policies • Microgeneration Regulation (2008) • Initially a max capacity of 1MW, increased in to 5MW in 2016 • Compensation through net billing mechanism • Renewable Electricity Act (2016) • Set a target of 30% of electricity to come from renewable sources by 2030 14 Alberta Results • As of Feb 2020, there were more than 5000 sites registered under the Micro-generation Regulation • Total installed capacity of 68MW from micro-generators • About 94.5% using PV systems • Renewable Electricity Act and the Micro-Generation Regulation remained unchanged 15 Ontario DG Policies • Renewable Energy Standard Offer Program - RESOP (2006) • Systems between 1kW and 10MW • Exclusive for systems connecting to the distribution system • Subject to 20 year contracts • Feed-in Tariff (FIT) program (2009) • Large-FIT: Systems greater than 500kW (connected to Tx or Dx) • Small-FIT: Systems between 10kW and 500kW (Dx) • Micro-FIT: Systems less than 10kW (Dx) • Subject to long-term fixed-price contracts with IESO (20 years on average) 16 Ontario Results • RESOP • 825MW of contracted capacity • Large-FIT program cancelled in 2016 • Currently has 896MW of contracted capacity (Dx) • Small-FIT program cancelled in 2016 • Currently has 573MW of contracted capacity • Micro-FIT program cancelled in 2017 • Currently has 261MW of contracted capacity • 62% are solar PV system, 17% wind, 8% hydro, 4.5% CHP 17 Nova Scotia DG Policies • Community Feed-in Tariffs program (COMFIT) (2011) • Offered a long-term fixed price contract to participants • Originally for projects between 10kW and 5MW • In operation between 2011 and 2016 • Solar for Community Buildings Pilot Program (2016) • Systems with less than 75kW • Subject to 20 year PPA contracts • Enhanced Net Metering Program (2016) • Systems with less than 1MW of capacity • SolarHomes Program (2018) • Rebates + Net Metering mechanism 18 Nova Scotia Results • Community Feed-in Tariffs program (COMFIT) • Created 150MW of renewable capacity • Mostly small wind projects • Solar for Community Buildings Pilot Program • Brought 1.5MW of solar capacity • Program is now closed • Enhanced Net Metering Program • Uptake was relatively limited at the beginning (130 systems) • SolarHomes + Net Metering Program (after 2018) • If all projects are completed, the small solar generation capacity could reach up to 12.2MW 19 DG Technology Assessment By Population Centers (Census of Population – 2016) 20 Solar PV Assessment – BC and Alberta Most population centers British Columbia: 90 Alberta: 108 Why Solar PV? 21 Solar PV Assessment – Ontario & Nova Scotia Most population centers Ontario: 255 Nova Scotia: 31 22 Electricity Production – Capacity Factor 23 Levelized cost of Electricity – Residential Solar PV Up to 10kW Retail electricity 13-16 cents/kWh 10-12 cents/kWh 16-17 cents/kWh 11-16 cents/kWh prices (Major cities) Capital cost = $2.5/WDC If 50% of the detached houses in 108 population centers in Alberta installed solar PV (8kW/system), the annual energy production will be 4000 GWh/year (5% of provincial electricity demand) 24 Levelized Cost of Electricity – Commercial Solar PV 14-17 cents/kWh 12-14 cents/kWh 15-20 cents/kWh 12-20 cents/kWh Retail electricity prices (Major cities) Capital cost Small (50kW) =$2.5/WDC Large (150kW) =$1.5/WDC 25 Biomass and MSW Assessment • Assessed the potential and economics of DG with biomass and municipal solid waste (MSW) by population center • Data availability is sparse and somewhat unreliable • Existing resources are matched with conversion technologies • Solid biomass • Incineration with steam turbines (ST) • Gasification with internal combustion engines (ICE) • MSW • Incineration with steam turbines (ST) • Anaerobic digestion with internal combustion engines (ICE) • Resource availability varies significantly • Biomass/MSW based DG can provide on demand power 26 Biomass and MSW Assessment Lethbridge (AB) Penticton (BC) London (ON) Supply (kt/year) 772 7 2683 Biomass Electricity potential 800-1000 7-12 3000-4000 (GWh/year) Supply (kt/year) 42 16 182 MSW Electricity potential 4-25 2-9 (GWh/year) 20-90 27 DG with Biomass 28 DG with MSW 29 Natural Gas CHP Assessment (Micro CHP) CHP = Combined heat and power Micro CHP: Electricity capacity of few kW Electrical Overall Heat to Thermal Energy Type of Micro CHP systems Efficiency Power Energy Efficiency (%) Ratio Qualities (%) Gas Turbines 70 – 85% 24 – 42% 1.3 – 2.0 High Reciprocating Engine 75 – 85% 33 – 53% 0.5 – 2.5 Low Micro Turbines 60 – 75% 15 – 33% 1.3 – 2.0 Medium to Low Fuel Cells (PEMFC) 75 – 85% 25 – 60% 0.33 – 2.0 Low Fuel Cells (SOFC) 75 – 85% 35 – 43% 1 – 2.5 High Sources: Renewableenergyhub, 2020, CIEEDAC (2016), Electropaedia (2018), Tan, K. (2018) 30 Natural Gas CHP Assessment (Micro CHP) • Eligibility