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What Is District Energy (DE)? THE ROLE OF DISTRICT ENERGY IN MAKING NOVA SCOTIAN COMMUNITIES ENERGY RESILIENT NS Nova Scotia Caucus www.questcanada.org ACKNOWLEDGEMENTS This report was written by Mary Ellen Richardson, Principal, Mary Ellen Richardson Inc. for QUEST Nova Scotia. Copyright © QUEST - Quality Urban Energy Systems of Tomorrow, 2014. These materials may be reproduced in whole or in part without charge or written permission, provided that appropriate source acknowledgements are made and that no changes are made to the contents. All other rights are reserved. The analyses/views in these materials are those of QUEST, and these analyses/views do not necessarily reflect those of QUEST's affiliates (including supporters, funders, members, and other participants). QUEST's affiliates do not endorse or guarantee any parts or aspects of these materials, and QUEST's affiliates are not liable (either directly or indirectly) for any issues that may be related to these materials. THE ROLE OF DISTRICT ENERGY IN MAKING NOVA SCOTIAN COMMUNITIES ENERGY RESILIENT 1 EXECUTIVE SUMMARY Canadians live and work in energy-intensive and energy-reliant communities. This is why every province in Canada is re-thinking their energy strategy. Indeed, many stakeholders believe it is also time for a pan Canadian energy strategy that contemplates both supply and demand solutions. There is a need for those provinces who are net importers of energy – such as Nova Scotia – to be particularly mindful of energy strategy given that their energy deficits make them especially vulnerable to energy supply interruption, including severe weather and man-made supply events. These provinces must carefully consider not only energy supply options, but also how that supply is applied in the most efficient way to meet consumer needs. They need to be particularly thoughtful about how they will refurbish and build energy systems to meet their future community energy needs, while also accomplishing their goals of economic, energy and environmental sustainability, security and resiliency. In fact, Nova Scotia has already thought carefully about their electricity strategy. This paper talks about the opportunity and need to include thermal energy as part of any energy policy initiative going forward in Nova Scotia. Thermal energy is the energy needed to heat and cool communities, and both are obviously essential in our climatic conditions. Moreover, as temperature patterns, frequency and severity of weather events change due to climate change, there is a need to rely on secure and resilient systems to dependably meet thermal energy needs. This paper specifically focuses on District Energy (DE) opportunities (see description below). It describes how other countries have "leap-frogged" Canada in meeting their energy needs and environmental goals, sustainably and securely by adopting DE solutions. And it talks about how Nova Scotia can catch up by following a similar path. * District Energy (DE) District Energy (DE) refers to systems that generate and distribute thermal energy (heating and/or cooling) at a community scale. The infrastructure includes a localized centre where energy is generated, and a network of buried insulated pipes (a “thermal grid”) that distribute that energy to buildings within a defined geographic area. In some applications, small-scale Combined Heat & Power (CHP) and thermal storage units are added for optimal operational efficiency, GHG reduction and added security. The medium for transmitting the thermal energy along the thermal grid is either steam (for legacy DE systems), or water for modern DE systems. Natural gas is the most commonly used fuel source to generate hot water or steam in Canadian DE systems. Due to their community-scale, DE systems are more adaptable over time than traditional energy delivery systems, as alternative fuels can be substituted to generate thermal energy. This ‘third’ energy grid is analogous to the other two energy grids that are relevant to our communities, namely the grid of pipelines to transport natural gas, and the grid of wires to transmit electricity. However, it offers significant incremental benefits. Unlike the natural gas grid, a DE grid can transmit thermal energy that is produced from a variety of fuel types. Unlike the electricity grid, a community scale DE grid can store thermal energy in the grid and in storage facilities. DE is not new, and it deploys and integrates proven technology in community scale infrastructure to produce and distribute thermal energy. It is being evaluated and deployed widely in Canada, Northern Europe and the US. For more information on District Energy and how it can contribute to resilient communities, see Appendix A. REPORT TO QUEST NS BY MARY ELLEN RICHARDSON INC. MARCH 2014 2 THE ROLE OF DISTRICT ENERGY IN MAKING NOVA SCOTIAN COMMUNITIES ENERGY RESILIENT Introduction DE systems have emerged in many jurisdictions, including in Frank Scarpitti, Mayor Canada and Northern Europe, as a key element of energy of Markham, Ontario, strategy. They support secure resilient community energy believes that District systems. Energy gives his city Evidence from Canadian jurisdictions (in particular, BC Ontario a competitive advantage and Alberta) shows that there are economically viable in attracting opportunities for both small and large-scale deployment of DE systems. DE can offer strong overall economic returns to businesses, promoting investors as well as clear community benefits. environmental stewardship and DE systems encompass the energy generation, distribution and providing resiliency. transfer facilities to provide any or all of the space and June 2013, Mayor Frank Scarpitti endorses domestic hot water heating, space cooling and electricity Markham District Energy, YouTube https://www.youtube.com/watch?v=RyPBVy services to communities. DE system operators have the ability AnzS8 to optimize the fuel used to generate the energy, in order to meet environmental and efficiency gains, through both low carbon feedstock substitution, and the addition of small-scale Combined Heat & Power (CHP) and thermal storage units.1 In this way, operators can deliver the energy services with greater efficiency than individual furnaces, boilers, electric baseboards, and water heaters fuelled by oil, natural gas, propane or electricity. Markham Thermal Storage Facility Canadian DE Development Until the early 2000s, DE development in Canada had been sporadic, led primarily by local (provincial and municipal) leaders. Ontario has been the home to many large DE projects and has long been the largest Canadian market in terms of both installed DE capacity and new development.2 Given that Ontario is also home to the largest Canadian city, growing air conditioning needs due to rising summer temperatures, continued population growth and urban densification, this is not surprising. Over the last several years, BC has emerged as the hub of substantive new DE developments-largely because of progressive environmental legislation. Graph 1 below shows DE project implementation in Canada over the last two decades. Appendix B provides a list of some DE systems in Canada. 1 Increasingly large heat storage units are being used with district heating networks to maximize efficiency and financial returns. In DE systems which include CHP units, operators can run the cogeneration units at times of maximum electrical rates, storing the excess heat production for distribution when needed. In other systems, storage has also allowed solar heat to be collected in summer and redistributed off season in very large but relatively low cost in ground insulated reservoirs or borehole systems. 2 “Legacy” steam systems. These systems use older technology, based on steam as the medium to transmit the energy through the distribution grid. Toronto’s Deep Lake Water Cooling System is one of North America’s largest DE systems. London District Energy is the oldest Canadian DE system (1880). The University of Toronto system just celebrated 100 years of existence. And the DE system that serves the Ottawa parliament and downtown civic buildings has also been in existence for decades. Hot Water systems: New systems use water as the medium to transmit energy through the distribution grid. The modern DE systems (Hamilton, Windsor, Markham) built in Ontario have been largely modeled after DE systems built in Northern Europe. Markham District Energy System is widely seen as the “poster child” of modern DE systems in Canada. REPORT TO QUEST NS BY MARY ELLEN RICHARDSON INC. MARCH 2014 THE ROLE OF DISTRICT ENERGY IN MAKING NOVA SCOTIAN COMMUNITIES ENERGY RESILIENT 3 Nova Scotia’s DE Development Lagging In contrast, with the exception of the HRM Alderney 5 project3, Nova Scotia has significantly lagged in new DE development over the last 25 years. A range of regulatory and institutional barriers still hinder these systems’ widespread adoption. This paper explores these barriers, and provides recommendations to overcome them. Graph 1: Canadian DE Implementation Timeline Source: Natural Resources Canada, CanmetENERGY. Accomplishing Nova Scotia’s Energy and Environmental Sustainability Objectives Nova Scotia has demonstrated a strong commitment to improving sustainability in electricity use. The passage of the Environmental Goals and Sustainable Prosperity Act in 2007, the creation of mandatory GHG reduction targets, the introduction of the Community Feed-in Tariff program, and the creation of a new provincial energy efficiency agency (Efficiency Nova Scotia) are some of the clear
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