Air Pollution Control Equipment Services, Coal, Nuclear

Ontario still depends on coal despite move to shut plants

By Amethyst Cavallaro
Online Editor, Power Engineering

As power generators in the United States make plans to invest billions of dollars in a coal-fired future, Canada’s province of Ontario is finding it harder to wean itself from coal-fired generation, which represents 20 percent of its energy makeup. The last two weeks have been a roller coaster ride for the province, as government officials have had to do some readjusting of campaign pledges due to regional energy demand growth. Now the government has had to make peace with two former foes, nuclear and coal, to meet energy needs.

Ontario Energy Minister Dwight Duncan announced a long-anticipated energy plan on June 13 that relies heavily on new nuclear reactors, refurbishing older nuclear plants, conservation efforts and doubling renewable energy production. It also included a controversial extension of the usage of coal-fired power plants, which were to be shut down by 2009. The plan sets the basis for a 20-year initiative to be developed by the Ontario Power Authority.

“We remain committed to replacing coal-fired generation in Ontario,” Duncan said in a statement released with the new plan. “We have made significant progress in reducing greenhouse gas emissions and ensuring cleaner air to improve the standard of living and quality of life for all Ontarians.”

But questions over the impact of air pollution have come full force at Ontario Premier Dalton McGuinty. During the question and answer period of the General Assembly meeting on June 13, Ontario New Democratic Party leader, Howard Hampton, had tough questions for the government:

“We’re hearing a lot of hot air from the minister, but what people across Ontario experience is more and more smog days,” he said in response to the premier’s statement on the government’s commitment to air quality. “The air is getting dirtier, not cleaner. And so far, we don’t see a plan. We see a media spin exercise but no plan. Where’s the plan for cleaner air in southern Ontario, as it gets dirtier every day?”

McGuinty’s plan relies heavily on nuclear power, which has opened debates over cost, environmental impact and waste storage. It also calls for doubling electricity production from renewable sources, doubling conservation efforts and expanding transmission capacity for wind projects. For fossil fuel-fired plants, the government has committed to capping NOx and SOx emissions.

The government’s decision to delay shutting down the coal-fired plants came from a recent report that showed an unexpected surge in previously predicted demand, to the tune of 2,500 to 3,000 MW.

After identifying the production gap in meeting demand, the Independent Electricity System Operator (IESO) released its semi-annual Ontario Reliability Outlook on June 9 that recommended delaying the provincial government’s coal replacement schedule “given the need for additional resources and because of delays in bringing replacement generation in service.”

Previous IESO predictions were based on weekly or monthly demand, following winter-month customer behavior.
But what McGuinty’s government and IESO did not count on in their energy planning was last year’s very hot summer. Over the hot, humid months, high air conditioning unit sales and a subsequent demand for electricity ballooned with a peak demand of 26,160 MW, an increase of 700 MW over the previous record set in 2002. Drought conditions prohibited hydropower from contributing its expected share to the grid. These factors forced Ontario to implement emergency control actions, like voltage reduction, and to import thousands of megawatts from the United States. This summer has already proven to be another demanding season. At the end of May 2006, peak demand was 4,500 MW higher than the previous peak set in May 2004.

The forecast adjustments and subsequent coal-replacement delays have created the uncomfortable political situation where major back-pedaling from previous energy commitments will be necessary.

Premier McGuinty’s government began in 2003 with campaign statements presenting visions for healthier air, a cleaner environment and a commitment to reducing greenhouse gas emissions. In June 2005, Energy Minister Duncan announced plans to shut down all of Ontario’s coal plants, representing more than 7,500 MW of generating capacity. He has now delayed those plans twice. The most recent plan has no set schedule for closing the coal-fired plants.

“The government has been ideologically opposed to coal and it helped them get elected,” said Dave Todd, editor of Power Week Canada. “But the emperor has no clothes, so to speak, and they’ve had to admit their only option is nuclear.”

But expensive nuclear projects do not sit well with a province that is still in $130.6 billion (Canadian) (US $116.577) billion of debt—a large part coming from nuclear project budgets that went out of control. Ontarians enjoy some of the lowest electricity rates in North America because of subsidized energy programs. The thought of rate hikes has cause public outcry.

Still fresh on the minds of many Ontario taxpayers are the budget overruns and years of delay for botched nuclear refurbishments, the most notorious being the Unit 4 nuclear reactor at the Pickering A station, outside of Toronto. The fiasco ended in the resignations of top executives of Ontario Power Generation (OPG) in late 2003 and millions of dollars in extra costs. In 2005, the government decided to decommission Units 2 and 3 at Pickering A station instead of investing in their necessary upgrades.

The government again has embraced nuclear and tucked away their policy for coal power plant shutdown for another day. Duncan has sought feasibility studies from OPG to refurbish the four existing units at Pickering B and has announced plans for new nuclear reactors. Now that the government has decided on a plan of action, it must face major growing pains in the areas of generation, infrastructure and rate changes for decades to come.