The report argues that for renewable technologies like wind to be part of the solution their costs of deployment must come down. "A plausible business plan leading to cost reductions over a five to ten year period needs to be developed so that these technologies could compete with other generation in a carbon-constrained world," it states.
A production credit is one of the most effective options available to begin building a market for renewable power in Canada, the report says. Using computer modelling, the panel found that a one cent per kilowatt hour credit, starting this year, would result in 4700 GWh of renewable generation and reduce C02 emissions by 1.2 million tonnes in 2010. Most of the new capacity would be wind power. A two-and-half cent credit would add 6500 GWh of renewables power, again mainly from wind, and reduce emissions by 2.3 million tonnes by 2010.
RPS too expensive
Other recommended measures include government green power purchases, consumer rebates for green power purchases, net metering and the installation of site-based, non-emitting generation on government buildings. Although the panel rejects the idea of a large scale renewable portfolio standard as too expensive, it suggests smaller, regionally based standards could help stimulate the market for emerging technologies. The estimated cost of these measures is between C$200 and C$500 million, spread over the next 30 years.
Canadian Wind Energy Association president Fred Gallagher, who sat on the 28 member panel with representatives from government, utilities and environmental groups, says he is "reasonably happy" with the recommendations. "I think we got, finally, a true recognition that renewables can play a pretty significant role," he says. "When we started these discussions, some panel members figured we were just there as window dressing."
Gallagher says the report's call for immediate action on renewables is a "major score." "This is a no-brainer," he says. "It's something we should be doing and it's easy, too. It doesn't require restructuring of the economy, it doesn't require a carbon price. Eventually, it will fold nicely into that whole scheme of things."
In its deliberations, the panel examined a number of supply and demand scenarios and set the "most likely" cost of bringing the electricity sector in line with Canada's Kyoto commitment at nearly C$10 billion, or about C$22 per tonne of C02 reduction.
Not surprisingly, the analysis shows that new natural gas and large hydro generation, combined with a drop in coal-fired production, is the most cost-effective mix to bring emissions six per cent below 1990 levels within the 2008-2012 commitment period. Wind power's contribution varies, increasing as gas prices rise.