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Holistic power planning welcome -- Ontario's long term approach

The wind power industry in Canada is lauding a newly unveiled, long term plan to build transmission lines into Ontario's windiest regions. "I think the plan overall is positive. The fact that there is a plan and they are taking a holistic approach to the system, looking at what the supply mix should be and developing a plan to bring in the wires and infrastructure to accommodate that supply mix is a very positive step," says David Timm, Ontario policy manager for the Canadian Wind Energy Association (CanWEA).

The 20-year integrated power system plan (IPSP) was submitted for regulatory approval in late August by the Ontario Power Authority (OPA). The 4000-page document lays out C$60 billion in new generation and transmission investments to meet electricity demand in 2027. The Ontario Energy Board is expected to take the better part of a year to review and approve the application.

The plan proposes building "enabler lines" to tap into areas, particularly along the Great Lakes, with the greatest potential for large scale wind power development. "One of the achievements of this particular plan is determining, with some specificity, the sites of wind that are most economic for Ontario and transmission necessary to capture that," says Amir Shalaby, the OPA's vice-president of power system planning. What is needed now, says Shalaby, is a policy decision on how the new lines will be paid for.

Under the current transmission system code, the cost of building lines to access remote sites falls on project developers. But the OPA would like to see that change, pointing out that renewables are a government policy priority. "These enabler lines should be treated as network assets and the costs -- at least the initial costs -- should be socialized. This is necessary in order to facilitate the development of these wind resources and, in particular, to attract and promote competition among developers," the plan says.

Keeping pace with policy

Timm says CanWEA has already been lobbying for changes to the way costs are allocated, not just for transmission but also for distribution lines. The Ontario government is promoting renewable energy development at the level of the distribution network through a program of standard offer power purchase contracts for smaller-scale projects. "Regulations have to keep pace with policy," says Timm.

The OPA has identified the key pockets for wind development in the province and now the industry wants to make sure they are built with sufficient capacity to tap the resources that are there, he continues. Sufficient transmission will provide far more flexibility in the future supply mix, he points out.

The mix outlined in the IPSP essentially follows a directive issued last year by Ontario energy minister Dwight Duncan. In addition to major new investments in nuclear power and energy conservation, it requires the addition of about 6000 MW of new renewables capacity by 2025. Overall, renewables will provide 30% of Ontario's electricity over the long term. The plan calls for the addition of 3039 MW of wind capacity on top of the 1646 MW on line or under contract in the province. CanWEA argues that wind could do much more. "Five thousand megawatts is a good start. I'd have to add them up, but there is close to that in identified and staked projects in the province already," says Timm.

Total cost

The OPA identified more than 12,000 MW of feasible wind power potential, but does not include more than 4685 MW because of economics. Its analysis found the cost of wind, transmission included, ranges from $C0.075-0.11/kWh, a deal more than the C$0.025-0.085/kWh range for nearly 3000 MW of new hydroelectric generation also included in the IPSP. "Moreover, the gap between hydroelectric and wind costs widened when account was taken of the fact that hydroelectric resources have a greater demand-meeting capability than wind resources," the plan says.

The OPA also did not increase the overall renewable energy target "due to the cost disadvantages of wind as compared to other conventional resources." While Timm is concerned the plan sets long term targets based on costs today, he points out that it is designed to be flexible enough to evolve as conditions change, a point emphasised by the OPA, which will update it every three years.

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