21,363 MW 22,774 MW ONTARIO ENERGY REPORT Q JULY SEPT 2014 ELECTRICITY. Electricity Highlights Third Quarter Ontario s Power Grid

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1 ONTARIO ENERGY REPORT Q3 Y T ELECTRICITY Electricity Highlights Third Quarter Electricity Generation Output by Fuel Type (Q3) Nuclear Ontario Peak Demand (Q3) 21,363 MW 25.0 TWh 65.7% Hydro 8.8 TWh 23.1% Gas/Oil 2.9 TWh 7.5% Wind 1.0 TWh 2.8% Ontario Peak Demand (YTD) Biofuel 0.3 TWh 0.9% 22,774 MW Net Energy Savings Jan 7, 7:00 PM EST Conservation Savings (YTD) Net Peak Demand Savings Aug 26, 6:00 PM EDT 668 MW 535 GWh Source: OPA Commodity Cost Hourly Ontario Energy Price (Weighted Average YTD) 4.26 /kwh Global Adjustment (Average YTD) 4.46 /kwh Total 8.72 /kwh Ontario s Power Grid Legend Nuclear generation Hydroelectric generation Gas-fired generation Wind-powered generation This map displays generation facilities with installed capacity of over 20 megawatts(mw) connected to the high voltage transmission grid. Please note that this map is used for illustrative purposes only. All locations are approximate. Last updated: September 9, Biomass generation 500 kv Transmission lines 230 kv Transmission lines 115 kv Transmission lines 1

2 Electricity Supply Monthly Energy Output by Fuel Type (MWh) Ontario has a diverse supply mix, featuring baseload generators that provide energy 24 hours a day, variable generators as well as flexible generators that change output quickly. The chart below sets out single month-end values of output by fuel type over the past 18 months, from July to September, illustrating how generator availability, demand for electricity and cost can lead to month-to-month variances. 15,000,000 12,000,000 9,000,000 MWh 6,000,000 3,000,000 0 OCT NOV DEC JAN FEB MAR APR MAY JUN Nuclear Hydro Coal Gas/Oil Wind Biofuel Imports and Exports Ontario imports and exports electricity for economic reasons. Imports compete against domestic generation to provide energy at the best possible price. Ontario also exports energy when prices are higher elsewhere and it is not needed to meet local needs. This brings revenue to help offset investments made in new infrastructure. Imports Q3 Exports Q3 Manitoba 8% Michigan 1% Minnesota <1% New York 1% Quebec 89% Manitoba 2% Michigan 40% Minnesota <1% New York 43% Quebec 15% (GWh) Manitoba Michigan Minnesota New York Quebec Total Imports , , Exports , , , While Ontario is electrically interconnected with Manitoba, Michigan, New York and Quebec, the interties allow for trade of electricity beyond those jurisdictions. Transactions can reach across eastern North America, contributing to a more diversified and competitive pool of supply. 2

3 Installed Capacity Connected to Transmission Grid Changes to installed capacity in this quarter highlight the continuing process of renewal in Ontario's electricity sector. With this report, the IESO begins reporting on a new Biofuel category of facilities, which were previously included in "Other". These facilities currently include Atikokan, Calstock, Fort Frances and four small facilities, each with less than 10 MW in capability. Ontario Power Generation (OPG) recommissioned the Atikokan generating facility, which is now fueled by biomass with capacity to produce about 200 MW of renewable energy. The IESO also continued to build greater flexibility and resiliency into the provincial power system with its recent announcement of five new storage technology test projects totaling 34 megawatts (MW), and the commissioning of two new storage projects as part of its 10 MW procurement of regulation from alternative sources. Current Installed Capacity (Grid-Connected) Nuclear 38% Hydro 24% Gas/Oil 29% Wind 7% Biofuel < 1% As of Aug 21, 18-Month Outlook Sept 4, The table below portrays the increased use of renewable resources, and the elimination of coal as a source of fuel for generating electricity in the province. Grid-Connected Installed Capacity (MW) Year Nuclear Hydro Coal Gas/Oil Wind Biofuel Total (as of Aug 21) 12,947 8, ,920 2, ,771 12,947 7,939 2,291 9,920 1, , ,998 7,947 3,293 9,987 1, , ,446 7,947 4,484 9,549 1, , Month Outlook Sept 4, 3

4 New Facilities Online Port Dover and Nanticoke Wind 105 MW Third unit at Harmon GS (Hydro) 78 MW Atikokan GS converted to biomass 205 MW McLean s Mountain Wind Farm 60 MW East Lake St. Clair Wind 99 MW Summerhaven Wind Energy Centre 125 MW South Kent Wind 270 MW Expected New Generation 18-Month Outlook Sept 4, In total, 2,400 MW of new generation capacity will connect to the transmission grid over the next 18-month period, including wind, solar, hydro and biomass generation. This includes the province s first grid-connected solar projects, which are presently commissioning and are expected to be in service in the next quarter, with facilities in northeast and western Ontario. At the same time, an additional 900 MW in renewable generation will be connected to local distribution systems. Available Capacity vs. Ontario Demand 18-Month Outlook Sept 4, + OPA Cooler than average temperatures throughout the quarter resulted in a noticeable drop in electricity demand in the province, compared to the same period in the previous year. Peak demand was over 14 per cent lower compared to the peak in the same quarter last year, and average total Ontario demand was about 4 per cent lower in comparison with Q3. Available Capacity at Peak 26,344 MW (Q3) Peak Demand 21,363 MW (Q3) Operating Reserve Requirement 1,418 MW (Q3) Available Capacity is all installed capacity, minus allowances made for seasonal derates, planned outages and the capacity of energy-limited resources. Reserve Requirement is the amount of supply resources required to handle the loss of the largest generating unit on the grid, plus loss of half the amount of the second largest unit. 4

5 Installed Solar and Wind Capacity Connected to Distribution Systems (MW) Increasing amounts of new wind and solar generation are being connected to local distribution networks, providing energy to serve local communities. Solar and Wind Generation Capacity in Ontario Distribution Systems MW (Q3YTD) Embedded Wind Embedded Solar Distribution Connected Solar and Wind Generation (MW) Year Wind Solar (Q3 YTD) Source: OPA 5

6 Conservation Incremental Net Savings The saveonenergy conservation programs enable residential and business customers to better manage their energy usage with access to energy-efficient equipment, real-time energy-saving data and educational tools. Many conservation programs are offered to customers by their local distribution company (LDC) while others are offered directly by the Ontario Power Authority (OPA). The table below outlines the net peak demand and energy savings from the saveonenergy programs supported by the OPA. For more information on the saveonenergy programs, visit saveonenergy.ca Q3* Q3 YTD* Year End Verified Q3* Q3 YTD* Year End Verified Q3* Q3 YTD* LDC Net Peak Demand Savings (MW) Net Energy Savings (GWh) Non-LDC Net Peak Demand Savings (MW) Net Energy Savings (GWh) Total Net Peak Demand Savings (MW) Total Net Energy Savings (GWh) *Net peak demand savings and energy savings are preliminary and unverified. Source: OPA Emissions The following table shows greenhouse gas emissions produced by nuclear, gas and coal generation facilities. Greenhouse gases (GHGs) are emitted from thermal facilities where carbon dioxide (CO 2 ) is the primary by-product of fossil fuel combustion. Nuclear facility GHG emissions are produced by auxiliary equipment Q3 Q3 YTD Q3 Q3 YTD Q3 Q3 YTD CO 2 Emissions (MT) SO x Emissions (T) NO x Emissions (T) PM 2.5 Emissions (T) Note: Forecasted emissions for 2012 YTD are based on October emission factor estimates and IESO generation data Source: OPA 6

7 Electricity Demand Ontario Peak Demand Year to Date 22,774 MW Jan 7, 7:00 PM EST Ontario Monthly Peaks and Minimums (MW) While Ontario electricity demand typically peaks in summer, a cooler-than-normal summer this year and record cold temperatures causing very high winter demand has meant that the demand peak established in January has not been surpassed. The monthly peak for July was considerably lower than peak demand for July, due to cooler-than-normal temperatures that resulted in lighter air conditioning load MW Peak 24,927 MW Peak (YTD) 22,774 MW July Peak 21,300 MW Minimum (YTD) 10,719 MW OCT NOV DEC JAN FEB MAR APR MAY JUN Maximums Minimums Forecast Demand Peaks The demand for electricity in the province is forecast on a rolling 18-month basis, and an assessment is done to assure the adequacy of the existing and proposed generation and transmission facilities to meet demand needs. The chart below presents Normal Weather forecasts, representing a typical peak for that time of year, and Extreme Weather forecasts that reflect severe weather conditions. Season Normal Weather (MW) Extreme Weather (MW) Winter 15 22,149 23,077 Summer ,808 24,669 Winter ,094 22, Month Outlook Sept 4, 7

8 Peak in Selected Ontario Communities (MW) Peak demand occurs when many consumers are all using electricity at the same time. Below is a table that shows peak demands for a cross-section of Ontario communities in. In areas of the province where residents rely on electricity to heat their homes and businesses, demand typically peaks in winter while communities in other parts of the province will see demand peaking in summer, to accompany heavy air conditioning loads. Local Distribution Company Hydro One Brampton (summer peak) Kenora Hydro (winter peak) Milton Hydro (summer peak) North Bay Hydro (winter peak) Oakville Hydro (summer peak) Peterborough Distribution (summer peak) Toronto Hydro (summer peak) MW 832 MW 21 MW 174 MW 110 MW 366 MW 158 MW 4915 MW Source: OEB Year Book Total Annual Ontario Energy Demand (TWh) Total (TWh)* Change Over Previous Year (Q3 YTD) % % % *Total does not include embedded generation Power Data, Demand Overview 8

9 Electricity Prices Commodity Cost ( /kwh) Commodity cost comprises two components, the wholesale price (the Hourly Ontario Energy Price) and the Global Adjustment. Year /kwh JAN FEB MAR APR MAY JUN YTD Avg. Hourly Ontario Energy Price (Wholesale Market Price) Global Adjustment (Class B Customers) Total Commodity Cost Monthly Wholesale Electricity Prices ( /kwh) The wholesale electricity price fluctuates by the hour. This chart shows the highest, lowest and average wholesale prices for each month /kwh OCT NOV DEC JAN FEB MAR APR MAY JUN Maximum Hourly Price Minimum Hourly Price Arithmetic Price Note the commodity cost is only a portion of the total energy bill. 9

10 Electricity What s New A collection of electricity reports and publications. Information Published By Date New Local Distribution Company Scorecards measuring performance for OEB March 5, A Review of Ontario Interties IESO/OPA October 14, Winter Electricity Time of Use Prices OEB October 16, 10