THE POWER OF ORGANIC WASTE: Renewable Natural Gas (RNG) for The Role of Government in Advancing RNG

• Cam Carruthers, E.D., Environment & Climate Change Canada • Carlyle Khan, Director, Infrastructure Dev’ment & Asset Mgmt., City of • Martin Imbleau, VP, GazMetro • MODERATOR: David Donovan, Sr. Advisor – Government Relations, Enbridge Clean Fuel Standard

December 2017 Cam Carruthers Context

• Pan-Canadian Framework (PCF) – on Clean Energy and Climate Change, announced by First Ministers, December 2016

• Clean Fuel Standard – part of PCF, announced by Minister McKenna, November 2016 ▪ To achieve 30 MT reductions from lower carbon fuels

– Discussion Document published in February 2017 – Summary of 125 Comments published – November 7, 2017 – Regulatory Framework – end 2017 - broad elements of the standard, for further consultation during regulatory design period

Page 3 – December 5, 2017 Principles

• Incremental to current measures • Broad coverage: – Fuels used in transportation, industry and buildings – Liquid, gaseous and solid fuels • Based on: – Reducing carbon intensity – Lifecycle approach • Drive innovation, clean technology, lower carbon and alternative fuels • Market-based approach • Lay foundation to reach 2050

Page 4 – December 5, 2017 CFS Regulatory Framework

• Scope – liquid, gaseous and solid fuels combusted for purpose of creating energy • Regulated party - fuel supplier (producer, importer, distributor) • Carbon Intensity (CI) = carbon emitted relative to amount of energy in fuel consumed (e.g. grams of CO2 per megajoule) – baseline levels and targets. – CI calculated using lifecycle approach: cradle to grave – CI targets more stringent over time • Compliance – variety of pathways/mechanisms to provide flexibility. • Review and Update – periodically • Timing – coming into force date to be determined

Page 5 – December 5, 2017 CFS Regulatory Framework: Fuels Covered

• Fuels used in Transportation: – On-road and off-road sources – Rail, marine and aviation

• Fuels used in Industry – a broad range of liquid, solid and gaseous fuels

• Fuels used in Buildings – residential, commercial and institutional buildings using fuel for space heating and generating power

Page 6 – December 5, 2017 Consultation and Regulatory Process (1)

• November 2016 – Minister McKenna announcement • February – April 2017 – Release of Discussion Paper – Subsequent workshops and webinars across stakeholders • April 2017 – Deadline for written comments, over 125 submissions • November 7, 2017 – Release of summary of written comments

Page 7 – December 5, 2017 Consultation and Regulatory Process (2) • End 2017 – Release of proposed Regulatory Framework • End 2017 – Winter 2018 – Multi-stakeholder committee / technical working groups – Work on regulatory proposals and technical issues with the Multi-stakeholder committee and working groups – Develop draft regulations • Mid to late 2018 – Publication of proposed regulations, Canada Gazette Part I • 2018- 2019 – Multi-stakeholder engagement continues – Final drafting • 2019 – Publication of final regulations, Canada Gazette Part II

Page 8 – December 5, 2017

Contacts

• Information – Clean Fuel Standard webpage: https://www.ec.gc.ca/energie-energy/default.asp?lang=En&n=EB5AAF7C-1 – Google Drive with consultation documents: – https://drive.google.com/drive/folders/0B5INNz63xpM_eE3Y0hSandLSWs – Clean Fuel Standard email: [email protected]

• Contacts Oil, Gas and Alternative Energy Division: – Cam Carruthers, Executive Director [email protected] – Lynne Patenaude, Manager, Fuels [email protected] – Lorri Thompson, Head, Fuels Regulatory Development [email protected]

Page 9 – December 5, 2017 City of Toronto, Solid Waste Management Services Renewable Natural Gas from Biogas/ Gas

Carlyle Khan, Director, Infra. Dev & Asset Mgmt. The Power of Organic Waste: Renewable Natural Gas (RNG) for Ontario, December 4, 2017

Solid Waste Management Services Who We Are

Mission Statement: To provide innovative waste management services to residents, businesses and visitors within the City of Toronto in a safe, efficient, effective and courteous manner, creating environmental sustainability, promoting diversion and maintaining a clean city.

Vision: To be an international leader in the operation of an innovative and sustainable solid waste management utility.

Solid Waste Management Services

Solid Waste Management Services

Solid Waste Management Services Biogas to Projects

• Landfill Gas • Very large quantities of gas

• Lower CH4 content • Higher amounts of impurities • Gas amounts decline over time • Potential odour issues • Biogas from Anaerobic Digestion • Lower quantities of gas • Higher CH4 content • Lower amounts of some impurities • Gas flowrates steady over time • Gas flows ongoing during operation

Solid Waste Management Services Four Priority Sites for Biogas and Landfill Gas

5.4M m3 per 5.3M m3 per year year

Disco Road OPF Dufferin OPF

35.6M m3 per 24.1M m3 per year year

Green Lane Landfill

Solid Waste Management Services Potential for a Closed Loop Approach

Solid Waste Management Services A Green Fuel Opportunity - RNG

• The Opportunity • Lowering Costs and GHG emissions with Compressed Natural Gas/Renewable Natural Gas • CNG Proposition

• Economic, Environmental and Social Benefits • Path to Net Neutral Emissions

• Greening the Solid Waste fleet with RNG

Solid Waste Management Services Flexible Commodity

• RNG can be used to: • Offset diesel fuel • Generate renewable electricity Environmental Ex: GHG emissions reductions • Offset traditional natural gas from diesel offset vs NG offset • Be sold through the United States Renewable Fuel Standards Program • Provides excellent flexibility to RNG Project municipalities to maximize economic, environmental, and social factors Triple Bottom Line Assessment • All end-use options will be assessed using a triple bottom line framework to select the Economic Social most appropriate mix Ex: RIN revenue vs fuel sales vs offset costs; future Cap & Ex: Less noisy vehicles vs odour Trade potential; high entry risk; potential for improved cost for NG vehicles health outcomes

Solid Waste Management Services Immediate Opportunity to Lower Cost and GHG Emissions

• Natural Gas Vehicles is an economical and environmentally-friendly alternative to diesel vehicles • CNG/RNG can fuel many different vehicle types including heavy-duty trucks, buses and streetcars, transportation trucks, trains, freight ships and even garbage trucks. • Converting from diesel to CNG means cleaner air.

Solid Waste Management Services RNG Transportation Options

• There are three (3) main methods for RNG delivery • Different sites may require different strategies, or a combination of strategies

Injection into Virtual pipeline Onsite utilization natural gas grid

Solid Waste Management Services Fueling Station Requirements

• The Division is examining requirements for future NG fueling stations • Constructed two (2) fill stations at our Bermondsey and Ellesmere Collection Yards, with the third under design, Ingram Collection Yard. • Key considerations include: • Capital cost requirements • Fast fill vs slow fill fueling • Onsite storage • Operating engineer requirements

Solid Waste Management Services CNG/RNG Projects

• Studying opportunities to leverage our assets to generate renewable energy • Compressed (CNG)/Renewable Natural Gas (RNG) emerged as the priority • Division has decided to pursue Natural Gas (NG) vehicles based on a triple-bottom line approach • The focus is now to leverage the potential to generate RNG from the Division’s anaerobic digestion (AD) facilities and • Next step: identifying the best end-use for our RNG output to generate financial, environmental, and social benefits

Solid Waste Management Services Collaboration with Enbridge Gas Distribution

• Solid Waste Management Services has benefited from a ongoing collaboration with Enbridge Gas Distribution on: • Design and construction of CNG fill stations and maintenance facilities • Planning and options assessment for RNG distribution infrastructure • Brokerage for RNG end uses • Policy development

Solid Waste Management Services Key Points and Future Directions

• Solid Waste Management Services has access to a renewable source of energy • Upgrading biogas and landfill gas to pipeline-quality renewable natural gas can produce significant environmental, social and economic benefits • Renewable natural gas projects could lead to an alternative source of revenue for the Division and provide benefits to the City of Toronto • Next step: Successfully deliver the Biogas to RNG Project at Dufferin OPF

Solid Waste Management Services But wait, there’s one more slide … Lessons leaned along the way …

• Establish a RNG market/demand in Ontario, with supporting policies and frameworks • Develop a guidance manual for RNG projects, including a tool to estimate how much fuel could be generated per year, with potential revenue, payback period, etc. • Encourage municipalities to share organic waste processing capacity • Ensure municipalities and partners are fully aware and have access to Provincial and Federal funding program in a clear manner • Streamline the approval projects for RNG projects, while integrating application data in a manner to support ECA/Noise/Air, etc. applications • Develop policies and frameworks to increase the diversion requirements of organic material, specifically food and kitchen waste • Allocate Cap & Trade Program (C&TP) funds towards Biogas to RNG projects • Include heavy carbon emitters in the future C&TP • Developed Renewable Fuel Standards (RFS)/Renewable Identification Numbers (RINs) program in Ontario/Canada • Establish a risk profile for RNG Projects that will support the availability of private sector funding for such projects.

Solid Waste Management Services Thank you!

Contact Information:

Carlyle Khan Director, Infra. Dev. & Asset. Mgmt. Solid Waste Management Services

City Hall 100 Queen St. W. 25th Floor, East Tower Toronto ON M5H 2N2

[email protected]

Solid Waste Management Services The Role of Government and Utilities in Advancing RNG

The Power of Organic Waste: Renewable Natural Gas (RNG) for Ontario Workshop hosted by Energy Vision, Enbridge Gas Distribution & Union Gas

Martin Imbleau December 4, 2017 Energir is about imagining energy differently. • While we continue to proudly distribute natural gas, for the past several years we’ve been working to diversify our energy sources. • Renewable natural gas, solar energy, wind power, and even natural gas for transportation—we’ve come a long way. • Today, we’re taking a new identity that better reflects who we are.

2 OCTOBRE 2015 GHG REDUCTION TARGETS POST-2020

28 L’ACCORD DE PARIS SUR LE CLIMAT ENTRE EN VIGUEUR

… vendredi 4 novembre « un jour historique pour la planète », parce qu’il marque l’entrée en vigueur de l’accord de Paris sur le climat (COP21)

29 DEUX ANS AVANT DE CONCRÉTISER L'ACCORD DE PARIS SUR LE CLIMAT

… pour mettre au point d'ici décembre 2018 les règles d'application de l'accord sur le climat conclu l'an dernier à Paris. 30 31 Governments, municipalities, regulators and utilities can facilitate the development of projects

Governments • Tax incentives, grants and investments that help improve the economics of either initial 1 investment or operations in renewable technologies • Policies and regulatory frameworks that facilitate energy transition

Municipalities • Leading player in RNG production through waste management plans 2 • Set the example in terms of sustainable development by using RNG

Regulators • Allowing utilities to deploy initiatives and programs that foster RNG market 3 development

Utilities • Support potential producers and new technologies to accelerate RNG 4 production development • Promote RNG as key to energy transition 32 32 Gas lobby chief : ‘In 2050, 76% of gas could be renewable’

Equal treatment between renewable electricity and renewable gas is something we see as necessary

33 Posted by Lauren Tyler -June 22, 2017

LA Metro Approves Massive Order for 295 Renewable CNG Buses…

The Los Angeles County Metropolitan like Los Angeles. But together, with the Transportation Authority (Metro) has voted to leadership from agencies like LA Metro, we purchase 295 40-foot compressed natural can use natural gas-powered vehicles to gas buses, which will be fueled by clean up the air and the environment in and renewable natural gas (RNG), according to around our communities today.” the latest release from NGVAmerica. The contract also includes an option for the “We take our responsibility to both the purchase of 305 additional 40-foot CNG environment and taxpayers very seriously,” buses. says Cris B. Liban, Metro’s executive officer for environment and sustainability. “By using NGVAmerica says the buses will replace renewable natural gas, as well as other part of the aging bus fleet and signals a technologies, we will continue to exceed our commitment by the transit agency, already environmental goals and ensure we provide one of the largest natural gas bus fleets in the best transportation service to our the nation, to continue using natural gas to customers and region.” […] improve air quality and reduce greenhouse- gas (GHG) emissions in Los Angeles Previously, LA Metro awarded an RNG County. contract to Clean Energy Fuels Corp. to fuel its…that fleet of transit run buses. on The gas deal made calls for REUTERS “Transit agencies around the nation continue Clean Energy to provide Metro with its to realize the benefits of renewable natural Redeementirely brand fromof RNG, made100% entirely from gas,” says Katheryn Clay, interim director of 100% organic waste. NGV America. “Diesel emissions continue to organic waste 34 plague our environment, especially in cities […] Paris is converting its fleet to natural gas vehicles

• 80% of waste collection vehicles in Paris are natural gas fueled, totaling more than 400 trucks • More than 10 M € invested in the construction of Photo credits: GRDF, grdf.fr natural gas fueling stations in Paris • The city plans on having more than 900 compressed natural gas (CNG) fueled buses operating as soon as 2020 • Compressed natural gas engines reduce noise pollution by up to 10 dB • CNG trucks are cleaner than diesel; reduce GHG by up to 25% and particle emissions by up to 90%

35 Sources: SIGEIF, Mairie de Paris, GRDF Photo credits: Mairie de Paris, paris.fr

Objectifs de réduction des émissions de GES au Québec

ANNÉE DE RÉFÉRENCE : 1990

Réduction de 20 % Réduction de 37,5 %

Réduction de 80 %

2020 2030 2050 36 Bill 106: An Act to implement the 2030 Energy Policy and amend various legislative provisions

With bill 106, the quantity of RNG to be delivered by a natural gas distributor will be determined by Quebec Government rulemaking

37 Saint-Hyacinthe:

A VISION FOR THE RENEWABLE NATURAL GAS AND TRANSPORTATION SECTOR

• AD of organic waste to produce 16 Mm3 of RNG, a local and renewable fuel

• Gradual conversion of the City’s vehicle fleet to natural gas • 7 vehicles in use initially • Total of 52 vehicles

• Moving forward, renewable natural gas supply will be ensured by the City Projected reduction of GHG emission 38 by about 22 000 tonnes/year Quebec town prepares to turn yogurt into natural gas

39 Local energy distributors must play a role in the deployment of emerging technologies Marketing of innovations Positioning of the distributor to promote

Research and development Demonstration Deployment and democratization in the market Technologies far from being Technologies ready to be Mature technologies / marketed marketed, but not adopted distributor’s participation not > New ideas > "Scale up" required > Patents > Integration > Easily available > Technologies deployed in VT but not > Attractive return on investment yet in Qc Example: fundamental research Examples: geothermal, heat pumps, Example: EnergyStar appliances solar panels

Not appropriate to include research and Appropriate to authorize the distributor to Appropriate in certain cases: development in the distributor’s activities invest in these technologies, making it > For technologies that significantly reduce possible to: distributors’ volumes > democratize the innovation > To protect the rates of existing customers > enjoy social and environmental benefits by making up for lost revenues > without giving undue competition to private players 40 Gaz Métro relies on a number of technologies to increase the proportion of renewable natural gas injected into its network

1955 2010 2020 2030 2040

Hydrogen (direct injection and methanation)

Second-generation RNG (thermo-chemical treatment of forest biomass)

Biomethane (AD of biomass and of landfill waste followed by purification)

Natural gas (extraction from deposits)… gradually replaced by other gases

Town gas 41 Gaz Métro tabled evidence to the Régie de l’énergie in July 2017 supporting the development and access of RNG in Québec

RNG Distribution Customers RNG Producers (Gaz Métro) (Voluntary market)

A. Parameters for B. RNG supply purchasing tariff for RNG from customers producers

Pending regulatory approval

The price of RNG billed to customers is based on the price Gaz Métro pays to producers without additional margin

42 Sale of RNG to Gaz Métro - limit risks to the producer

A - Parameters for purchasing RNG from producers* 1. Base rate: feed-in tariff guaranteed to the producer and based on a curve that reflects economies of scale 2. Indexing: indexed annually from the signing of the contract 3. Minimum price: maximum between the base rate indexed and the avoided cost (carbon market, supply and transportation) 4. Duration: 5 to 20 years to facilitate financial planning

*Subject to the Régie’s approval of the terms and conditions in file R-4008-2017 on the measures related to the purchase and sale of RNG 43 Access to RNG will be facilitated by the introduction of an RNG supply tariff for gas network customers

B - Parameters of the RNG supply tariff* 1. Price: based on the projected RNG acquisition cost for the coming year (weighted average of all the supply sources) 2. Review: annual tariff established in the rate case 3. Volumes: can select the % of RNG desired, as long as it is more than 5% 4. Accessibility: all gas network customers, as long as RNG is available 5. Entry and withdrawal conditions: notice of 60 days for the entry, withdrawal or for any change in the % of RNG desired

*Subject to the Régie’s approval of the terms and conditions in file R-4008-2017 on the measures related to the purchase and sale of RNG 44

Thank you RNG strategy in Québec 48 Role of municipalities in developing RNG AGENCE QMI Lundi, 20 mars 2017 13:48, MISE à JOUR Lundi, 20 mars 2017 13:48 AVERTISSEMENT DE SMOG DANS LA VALLÉE DU SAINT-LAURENT

Un avertissement de smog pour la vallée du Saint-Laurent, de la frontière ontarienne jusqu’à la région de Montmagny, a été émis par Environnement Canada, lundi. En plus des régions de Montréal et de Québec, la Mauricie, la Beauce, la Montérégie, Lanaudière et le Centre- du-Québec sont visés par cette alerte. La qualité de l’air dans ces régions devait être mauvaise en raison des concentrations élevées de particules fines.

«Le smog affecte surtout les enfants asthmatiques et les personnes atteintes de maladies respiratoires ou cardiaques. Il leur est donc recommandé d'éviter les activités physiques intenses à l'extérieur jusqu'à la levée de l'avertissement de smog», a mentionné Environnement Canada dans son avertissement. Le ministère fédéral précise que «le chauffage au bois est la principale source de particules fines qui contribue au smog l'hiver», devant l'activité industrielle et le transport. […]

PHOTO D'ARCHIVES 50 Édition du 15 mars 2016, section ACTUALITÉS, écran 2 PIERRE-ANDRÉ NORMANDIN, LA PRESSE CLIMAT UN PLAN D’ACTION CONTRE LE SMOG RÉCLAMÉ À MONTRÉAL

Montréal a un plan d’urgence pour les canicules, un autre pour les grands Celui-ci devra inclure des mesures concrètes à mettre en place lors des froids, mais la métropole ne fait pratiquement rien quand un épisode de smog épisodes de pollution intense. sévit, déplore l’opposition à l’hôtel de ville, qui réclame la mise en place d’un plan d’action. Sylvain Ouellet ne croit pas que Montréal devrait aller aussi loin que Paris, en France,interdit qui, lors des épisodesaux de véhicules smog, interdit aux véhicules de de rouler selon Les 4 et 5 mars derniers, Montréal a connu son plus récent épisode de smog. le numéro sur leur plaque. L’élu croit que la métropole pourrait imiter Laval et L’élu Sylvain Ouellet, de Projet Montréal, dit ne pas avoir été impressionné par offrirrouler des réductions selon de prix pour ses le transports numéro en commun. Il suggèresur les moyens pris par la Ville de Montréal pour prévenir ses citoyens : envoyer également d’augmenter les tarifs des parcomètres lors des épisodes de smog un message sur les réseaux sociaux rappelant qu’il est interdit d’utiliser un ou encore d’interdire certaines zones aux voitures polluantes. poêle à bois. leur plaque. Rappelons que le smog est une brume jaunâtre recouvrant les villes lorsque la « Quand il y a une tempête de neige, c’est rendu qu’on fait une conférence de pollution est plus intense. Un jour de smog est décrété quand la qualité de l’air presse chaque jour, mais pour le smog, on fait un tweet et à peu près rien est jugée mauvaise sur plus de 75 % du territoire de la métropole. Un d’autre », déplore Sylvain Ouellet. règlement interdit depuis 2015 d’utiliser un poêle au bois durant ces épisodes, sous peine d’amendes. Le conseiller juge cette action bien insuffisante, surtout en considérant que le smog est soupçonné de provoquer 1500 morts prématurées par année à […] Montréal, selon la Direction de santé publique. « Si tu raccourcis la vie de 1500 personnes par année, ce n’est pas négligeable. » — Sylvain Ouellet de Projet Montréal Lors du prochain conseil municipal, Projet Montréal présentera une motion afin 51 d’ordonner à la Sécurité civile de la métropole d’élaborer un plan d’action. Other initiatives led by Gaz Métro to accelerate development of RNG

Decrease injection costs 1 • Optimization of injection station design (cost and footprint)

Client-friendly policy for RNG producers 2 • Elimination of penalty for nomination imbalances

Creation of a Gaz Métro team dedicated to the development of the RNG 3 sector • Support for potential producers • Facilitator between the various stakeholders

52 Many forward-thinking North American cities are actively developing their RNG market

Portland • Largest wastewater treatment plant to integrate a RNG production facility in order to inject in the city gas grid • 3M$ of additional revenue to the city • More than 21,000 t of GHG saved each year

Brooklyn • Biogas produced from local wastewater plant to be refined and injected in the city gas grid • RNG produced will meet the demand of more than 2500 Brooklyn residences • More than 16,000 t of GHG saved each year San Francisco • Since 2009, landfill gas is refined to produce renewable natural gas powering 300 waste collection trucks • More than 30,000 t of GHG saved each year

53 Sources: biogasdata.org, EPA, Publié le 25 mars 2016 à 06h00 | Mis à jour le 25 mars 2016 à 06h00 MARTIN CROTEAU, CHARLES CÔTÉ

Les efforts de réduction des GES stagnent au Québec

Les efforts du Québec pour réduire les émissions de gaz à Révision à la hausse effet de serre (GES) stagnent, révèle un rapport rendu public hier par le gouvernement Couillard. Pire, la pollution au La Encoreprécédente mouture desde l'Inventaire transports québécois des GES, rendu carbone de la province a été révisée à la hausse en raison de public l'an dernier, estimait les émissions du Québec à 78 nouvelles méthodes de calcul. mégatonnes en 2012. Ce chiffre a été révisé à la hausse de 4,2 % dans le bilan publié hier. La raison : les fonctionnaires du - 0,001 % gouvernement du Québec n'avaient pas appliqué les dernières C'est la baisse des émissions de GES au Québec entre 2012 et directives du Groupe intergouvernemental d'experts sur 2013, selon l'Inventaire québécois des émissions de gaz à effet l'évolutiongénéré du climat (GIEC). 43 Cette % méthode des de calcul a été de serre publié hier. Le document révèle que les émissions de élaborée parce que les scientifiques avaient jusque là sous- carbone s'élevaient à 81,2 mégatonnes en 2013, à peine moins estiméémissions la contribution du méthane aux changements climatiques. que l'année précédente. Les émissions ont néanmoins baissé de 5,7 % depuis 2009. […] québécoises « Inquiétant » Ce dernier bilan est « inquiétant », juge le porte-parole de Greenpeace, Patrick Bonin. Le gouvernement Couillard s'est engagé l'automne dernier à réduire les émissions québécoises de 37,5 % sous le niveau de 1990 d'ici 2030. Or, si la tendance se maintient, Québec va rater cette cible de loin. « Alors que les réductions devraient s'accélérer, on stagne au Québec, dénonce M. Bonin. Il va falloir prendre le taureau par les cornes à un moment donné. La lutte aux changements climatiques ne peut se limiter à mettre en place un système de plafonnement et d'échange des émissions. » Encore des transports Les transports continuent d'être la principale source de pollution Le gouvernement Couillard s'est engagé l'automne dernier à réduire les émissions québécoises de gaz au carbone au Québec. Malgré une légère amélioration, ce à effet de serre de 37,5 % sous le niveau de 1990 d'ici 2030. Or, si la tendance se maintient, Québec secteur a généré 43 % des émissions québécoises en 2013. La ratera cette cible de loin. multiplication des véhicules sur les routes est directement PHOTO MARTIN TREMBLAY, ARCHIVES LA PRESSE responsable du phénomène. Le nombre de camions légers et lourds augmente et les automobilistes parcourent de plus grandes distances. 54

Renewable natural gas is central to Gaz Métro strategy as it provides clean, flexible and locally produced energy

Simplified RNG value chain Advantages for customers

100% renewable energy and no GHG Energy emissions1 Organic waste Local energy production that supports: ‒ The circular economy ‒ The creation of local jobs ‒ Reduced dependence on international imports Alternative green energy that’s economically competitive Flexible solution allowing customers to achieve Gas 5 to 100% greener energy consumption network Collection

Biomethanization

1 No emissions for 99.4%, and 0.6% emissions from incomplete combustion of methane and N2O

55