You Say You Want a Revolution

A recurring theme at the recently held fourth World Future Energy Summit (WFES) was that the transformation to a clean energy future requires a new way of thinking. That new way of thinking was best described by Lord Nicholas Stern, Chair of the Grantham Research Institute on Climate Change and the Environment, London School of Economics. “In order that climate change targets can be achieved, we face the need for a new industrial revolution. That industrial revolution needs policy change as a driver to reach the scale of change required. With fundamentally strong policy, we can also increase the pace of that change.”

One such policy shift described at the summit is government fuel subsidies. “Government subsidies of energy fuels leads to inefficiencies and waste through artificially high use,” said Dr. Fatih Birol, Chief Economist of International Energy Agency. “Coupled with the current gas glut this poses a real threat to future investment in renewables.”

Another policy shift is to refocus sustainable infrastructure development from established economies to emerging economies. “Developing countries offer a ‘clean sheet’ for renewable technologies as they often do not have the old technologies and infrastructure that developed economies have”, said Rene Umlauft, CEO Renewable Energy, Siemens, Germany. “This means that they can ‘leapfrog’ the problems that developed countries have in replacing old energy systems, making them a key investment market.”

Closer to Home

But policy shifts that drive green energy and sustainability are more than just ideas voiced at environmental summits. Closer to home, the Ontario government’s policies are the drivers of change.

In 2007, the Ontario Power Authority developed a 20-year energy policy that focused on “creating a sustainable energy supply, targeted to improving current natural gas and renewable assets at a sustainable and realistic cost.” That plan included the very successful Feed-in-Tariff program wherein small energy producers using renewable energy sources were paid for surplus power supplied to the grid.

In 2009, the Ontario government introduced its Green Energy and Green Economy Act and its Long-Term Energy Plan (660KB PDF) as an update of the 2007 plan.

During the 1990s, five coal-fired plants, all operated by Ontario Power Generation (OPG), supplied up to 25 per cent of Ontario’s electricity. With the Long-Term Plan, all coal-fired units will be phased out by December 31, 2014. In doing so, Ontario will become the first jurisdiction in North America to eliminate coal-fired generation.

Closing coal plants actually started in 2005 when OPG decommissioned the Lakeshore generating station in Mississauga, Ontario. In 2010, it shut down two units at Nanticoke and two at Lambton generating station. Two more units at Nanticoke are scheduled to be shut down in 2011. Nanticoke was the largest coal-fired generating station in North America and the largest single emitter of greenhouse gases in Canada.

To make up for lost generating capacity, the single unit at the Atikokan plant in northern Ontario is being converted to burn biomass consisting of wood pellets and agricultural by-products. Two of the three units at Thunder Bay will be converted to natural gas. As well, units at Nanticoke and Lambton may be converted to burn gas or biomass.

Ontario expects that nuclear power will continue to provide up to 50 per cent of its electricity. This may call for refurbishment and modernization of units at the Darlington, Pickering and Bruce nuclear generating stations as well as the addition of two to four new reactors at Darlington.

The province will add capacity through upgrades to, and new construction of, hydropower facilities, wind farms and solar parks. Ontario already leads the country in wind and solar capacity.

Existing Feed-in-Tariff programs, which initially included biomass, biogas, landfill gas, wind, solar and small hydro, will be expanded to include small combined heat and power projects.

While policy is driving change in Ontario, it may not be the only driver. The first Industrial Revolution was driven by innovation and technology that allowed mass production. Similarly, recent advances have contributed to the economic viability of renewable resources such as wind power and solar photovoltaic energy and to the more efficient use of conventional fuels in new technologies such as combined cycle gas turbines. Without these advances, implementing policy change might be prohibitively expensive.

Held in Abu Dhabi and hosted by Masdar, an Abu Dhabi based renewable energy and sustainable technology organization, the WFES is an annual event that promotes innovation and investment opportunities surrounding renewable energy and the environment. This year’s meeting was attended by more than 26,000 visitors from 137 countries. Delegates included political leaders, international policy makers, industry experts, investors,and academics.

E3 Roundtable Discussion Continues

The third of four E³ (energy, environment, economy) Roundtables was held in Calgary January 17^th, 2010. Hosted by Corporate Knights magazine and sponsored by Enbridge, the Roundtables “provide for a discussion that will support the development of visionary energy policy options for the whole of Canada.”

Central to the discussion was the theme question “Most Canadians expect that we all will eventually transition from carbon-based to low-carbon energy. How do we make it happen in a way that unites rather than divides?”

While five of the six panelists agreed with the necessity for an energy policy or strategy, David Keith, Director, ISEEE Energy and Environmental Systems Group, sees the need for a “climate policy” because the prime driver for an energy policy is climate.

Preston Manning, President & CEO, Manning Centre for Building Democracy, presented four key principles toward an energy policy, foremost of which is the need for proper measurement of the environmental aspects of all energy sources, not just oil and gas.

Marlo Raynolds, Senior Advisor, Pembina Institute, spoke to Canada focusing too much on fossil fuels. A national energy policy has to focus on greenhouse gas emissions and include renewable energy and energy efficiency in the economy.

According to Roger Gibbons, President & CEO, Canada West Foundation, hydropower and hydrocarbons form Canada’s competitive advantage and going forward we must focus on producing them in better ways.

Both Eric Axford, Senior Vice President, Suncor Energy Inc., and Eric Miller, Senior Vice President, Nexen Inc., cite technology and innovation as keys to achieving energy sustainability.

Most agreed that ultimately, if we all make the right personal choices, we won’t need an energy policy.

Suncor chief calls for national energy strategy

Speaking to a Toronto audience earlier this month, Suncor CEO Rick George said that Canada needs a national energy strategy in order to take full advantage of its vast resources and its proximity to the United States. George told the business audience that Canada cannot wait much longer for a national energy strategy in light of events around the world, and especially south of the border.

“The Canadian energy sector is simply too important to manage passively or leave to chance,” said George. “The Obama administration is moving forcefully on both energy security and climate change issues. If Canada is to be a policy maker rather than a policy taker, we need to get our own energy house in order — and quickly.”

Such a strategy, in George’s view, could have many characteristics. For example, Canada should do a thorough, long-term energy assessment for its businesses and residents then match that assessment with policies and infrastructure. As well, energy efficiency should be a hallmark of a national energy strategy, said George, and policy makers should look beyond basic energy production to consider the full life cycle of energy sources. “After all, up to 80% of greenhouse gas emissions from a barrel of oil are generated through the tailpipe.”

“Many of the countries where conventional oil reserves are still abundant are plagued by political and economic instability. For Canadians and for our neighbours to the south, Canada is and should be seen as a pillar of reliable and responsible resource development.”

Winds of opportunity – and challenge – blow around the world

The imperatives and challenges of growth in difficult economic conditions around the world was a hot topic of conversation at the recent Canadian Wind Energy Association (CanWEA) conference in Toronto. Panelists from the United States, Europe and Canada spoke about global wind industry trends in their jurisdictions to a packed audience on the first full day of the conference.

Denise Bode, head of American Wind Energy Association drew on the strong leadership of President Obama in talking about the advance of wind energy in the States. However, Bode also said that the ability of the Department of Energy to implement federal energy policy through federal stimulus money across the country is being hampered by state-level fragmentation. The clear implication was that Canada’s challenges in establishing national energy policies is echoed south of the border.  So “hang in there”, in other words.

Similarly, Christian Kjaer, head of the European Wind Energy Association spoke of challenges stemming from trying to drive supra-national energy policy in a region of 27 member states, all of whom have policy levers over and considerable interests in the development of energy in the European Union.

Germany, for example, is a global leader in solar power and Denmark a global wind leader. Both countries have policies contributing to that leadership. At the same time, other EU-based countries lag in renewable energy, comparatively speaking, but are leaders in – or at least more reliable on – fossil fuels. Among other things, this contributes to a European hot house of technological innovation in energy amidst increased citizen expectations. Not surprisingly, Europeans look eagerly at Canada in terms of wind given the ample natural resources here and the lack of domestic industry (at least for turbines and blades).

The next CanWEA conference will be held in Montreal from October 31 to November 3, 2010.