Globe 2016 Outcome. What s in the Vancouver Declaration? Can we Influence? AREA presentation March 19, 2016 To Calgary Renewable Energy Meetup

Transcription

1 Globe 2016 Outcome What s in the Vancouver Declaration? Can we Influence? AREA presentation March 19, 2016 To Calgary Renewable Energy Meetup

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3 Vancouver Declaration on Clean Growth and Climate Change March 3, 2016 Canada stands at the threshold of building our clean growth economy. This transition will create a strong and diverse economy, create new jobs and improve our quality of life, as innovations in steam power, electricity and computing have done before. We will grow our economy while reducing emissions. We will capitalize on the opportunity of a low-carbon and climate-resilient economy to create good-paying and long-term jobs. We will do this in partnership with Indigenous peoples based on recognition of rights, respect and cooperation.

4 Vancouver Declaration on Clean Growth and Climate Change We will build on the leadership shown and actions taken by the provinces and territories, as exemplified by the 2015 Quebec Declaration and Canadian Energy Strategy, by working together and including federal action. We will build on the momentum of the Paris Agreement by developing a concrete plan to achieve Canada's international commitments through a pan- Canadian framework for clean growth and climate change. Together, we will leverage technology and innovation to seize the opportunity for Canada to contribute global solutions and become a leader in the global clean growth economy.

5 To that end, First Ministers agree to the following: 1. Increase the Level of Ambition Recognizing the Paris Agreement which calls for significant reductions in global greenhouse gas (GHG) emissions to limit global warming to less than 2 C and to pursue efforts to limit it to 1.5 C above preindustrial levels; Recognizing that the level of ambition set by the Paris Agreement will require global emissions to approach zero by the second half of the century and that all governments, Indigenous peoples, as well as civil society, business and individual Canadians, should be mobilized in order to face this challenge, bringing their respective strengths and capabilities to enable Canada to maximize the economic growth and middle class job opportunities of a cleaner, more resilient future; First Ministers commit to: Vancouver Declaration on Clean Growth and Climate Change Implement GHG mitigation policies in support of meeting or exceeding Canada's 2030 target of a 30% reduction below 2005 levels of emissions, including specific provincial and territorial targets and objectives; Increase the level of ambition of environmental policies over time in order to drive greater GHG emissions reductions, consistent with the Paris Agreement; Better coordinate GHG emissions reporting systems among jurisdictions to accurately and transparently assess the progress and the impact of our climate actions towards our respective and collective targets.

6 2. Promote Clean Economic Growth to Create Jobs Recognizing that the cost of inaction is greater than the cost of action with regard to GHG emissions mitigation and adaptation to the impacts of climate change; Recognizing that clean growth which supports the transition to a climate-resilient and low carbon economy by 2050 is necessary to ensure the future prosperity of Canada and Canadians; Recognizing the diversity of provincial and territorial economies, and the need for fair and flexible approaches to ensure international competitiveness and a business environment that enables firms to capitalize on opportunities related to the transition to a low carbon economy in each jurisdiction; Recognizing the economic importance of Canada's energy and resource sectors, and their sustainable development as Canada transitions to a low carbon economy; Recognizing that growing our economy and achieving our GHG emissions targets will require an integrated, economy-wide approach that includes all sectors, creates jobs and promotes innovation; Recognizing that investing in clean technology solutions, especially in areas such as renewable energy, energy efficiency and cleaner energy production and use, holds great promise for sustainable economic development and long-term job creation; First Ministers commit to: Vancouver Declaration on Clean Growth and Climate Change Ensure deep reductions in GHG emissions and a competitive economy, provide certainty to business, and contribute global solutions to a global issue; Foster and encourage investment in clean technology solutions for Canada and the world that hold great promise for economic growth and long-term job creation; Implement measures grounded in the view that clean growth and climate change policies are of net economic, environmental and social benefit to Canadians.

7 3. Deliver Mitigation Actions Vancouver Declaration on Clean Growth and Climate Change Recognizing that a collaborative approach between provincial, territorial and federal governments is important to reduce GHG emissions and enable sustainable economic growth; Recognizing the important role all governments have in the global effort to reduce GHG emissions, and that a number of provinces and territories have already joined or are exploring entry into regional and international efforts to reduce GHG emissions; Recognizing that development of new technologies and deployment of existing technologies and innovations in areas such as cleaner energy production and use, renewable and alternative energy, energy efficiency and innovative financial instruments will create new and competitive economic opportunities, domestically and abroad, that can facilitate the transition to a more resilient, low carbon economy; Recognizing that carbon pricing mechanisms are being used by governments in Canada and globally to address climate change and drive the transition to a low carbon economy; Recognizing that provinces and territories have been early leaders in the fight against climate change and have taken proactive steps, such as adopting carbon pricing mechanisms, placing caps on emissions, involvement in international partnerships with other states and regions, closing coal plants, carbon capture and storage projects, renewable energy production (including hydroelectric developments) and targets, and investments in energy efficiency; Recognizing that the federal government has committed to ensuring that the provinces and territories have the flexibility to design their own policies to meet emission reductions targets, including their own carbon pricing mechanisms, supported by federal investments in infrastructure, specific emission reduction opportunities and clean technologies; First Ministers commit to: Transition to a low carbon economy by adopting a broad range of domestic measures, including carbon pricing mechanisms, adapted to each province's and territory's specific circumstances, in particular the realities of Canada's Indigenous peoples and Arctic and sub- Arctic regions. The transition also requires that Canada engage internationally; Foster investments in clean technologies to reduce the GHG emissions associated with the production and consumption of energy, including renewable and alternative energy, energy efficiency and storage, and other technologies which may include carbon capture and storage; Encourage the sharing of information, expertise and best practices in order to foster a business environment that favours investments in innovative clean technologies related to climate change; Work together to enhance carbon sinks, including in agriculture and forestry, taking into account international best practices and accounting standards, to recognize their contribution to mitigating GHG emissions, and toward the establishment of a pan-canadian offset protocols framework and verified carbon credits that can be traded internationally.

8 4. Increase Action on Adaptation and Climate Resilience Recognizing that Canada has already experienced severe impacts of climate change, including forest fires, droughts, flooding, coastal erosion, thawing permafrost, invasive species, and the spread of diseases previously foreign to Canada; Recognizing that the health and security of populations, as well as the economy, infrastructure, cultural heritage and ecosystems are being impacted by climate change, and that climate risks and inaction have significant implications for the economic and social development prospects of provinces, territories, Indigenous peoples and Canada as a whole; Recognizing that Canada's northern and coastal regions are particularly vulnerable and disproportionately affected by the impacts of climate change; Recognizing the importance of traditional ecological knowledge in regard to understanding climate impacts and adaptation measures; Recognizing that comprehensive adaptation efforts must complement ambitious mitigation measures to address unavoidable climate change impacts; First Ministers commit to: Vancouver Declaration on Clean Growth and Climate Change Implement strong, complementary adaptation policies within our respective jurisdictions to address climate risks facing our populations, infrastructures, economies and ecosystems, in particular in Canada's northern regions. Support climate resilient and green infrastructure, including disaster mitigation; Strengthen the collaboration between our governments and Indigenous peoples to support local adaptation efforts.

9 Vancouver Declaration on Clean Growth and Climate Change 5. Enhance Cooperation Recognizing that in the Paris Agreement, Parties agreed that they should, when taking action to address climate change, recognize and respect the rights of Indigenous peoples; Recognizing that, in April 2015, Premiers concluded the Québec Summit on Climate Change with the Declaration of the Premiers of Canada by which they have agreed to act together in the fight against climate change; Recognizing the leadership of the provinces and territories in developing the Canadian Energy Strategy, which was released in July 2015 and charts a path for shaping the sustainable development of Canada's energy future; Recognizing the importance of provincial and territorial actions to enable the achievement of clean growth and climate change objectives and targets; Recognizing the commitment of the federal government to work with the provinces and territories in order to complement and support their actions without duplicating them, including by promoting innovation and enabling clean growth across all sectors; Recognizing that Canada cooperates with the United States and Mexico on energy and the environment, including through a recently signed Memorandum of Understanding on Climate Change and Energy Collaboration; Recognizing the importance of public education, participation and access to information to increase climate change awareness and literacy; First Ministers commit to: Strengthen the collaboration between our governments and Indigenous peoples on mitigation and adaptation actions, based on recognition of rights, respect, cooperation and partnership; Strengthen pan-canadian intergovernmental cooperation and coordination on clean growth and climate change, including through mechanisms such as the Canadian Council of Ministers of the Environment, Ministers of Finance, Ministers of Innovation and Economic Development, and Energy Ministers, in collaboration with Indigenous peoples; Implement a collaborative, science-based approach to inform Canada's future targets that will increase in stringency as required by the Paris Agreement; Enable the participation of provinces and territories in cooperative activities related to their jurisdictions with the United States and Mexico on energy and climate change mitigation and adaptation; Facilitate cooperation to strengthen public communication and participation on climate change, improve public climate literacy, promote the actions taken by governments to reduce GHG emissions, and support international engagement.

10 Vancouver Declaration on Clean Growth and Climate Change Taking Action In order to achieve these commitments, First Ministers agree to work together to develop a pan-canadian framework on clean growth and climate change, and implement it by early It will build on measures that the provinces and territories have taken, be supported by broad engagement with Indigenous peoples and all Canadians, and be informed by science and evidence. It will inform the development and submission of Canada's Nationally Determined Contribution and its long-term low greenhouse gas emission development strategy under the Paris Agreement as Canada's plan to achieve our international commitments.

11 Vancouver Declaration on Clean Growth and Climate Change Taking Action Six Specific Actions include: 1. Early actions by the Government of Canada; 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term; 3. Working together on Energy Efficiency and Clean Energy Technology and Innovation; 4. Engage Indigenous peoples in the development of the pan- Canadian framework on clean growth and climate change; 5. Engage the public in the development of the pan-canadian framework on clean growth and climate change; 6. First Ministers will meet in fall 2016 to finalize the pan- Canadian framework on clean growth and climate change, and review progress on the Canadian Energy Strategy.

12 1. Early actions by the Government of Canada: a) Supporting climate change mitigation and adaptation through investments in green infrastructure, public transit infrastructure and energy efficient social infrastructure; b) Investing in GHG emission reductions by working together on how best to lever federal investments in the Low Carbon Economy Fund to realize incremental reductions; c) Fulfilling Canada's commitment to Mission Innovation, made in Paris in December 2015, by doubling government investment in clean energy research and development over the next five years, and spurring private sector investment in clean technology; d) Advancing the electrification of vehicle transportation, in collaboration with provinces and territories; e) Fostering dialogue and development of regional plans for clean electricity transmission; and f) Investing in clean energy solutions to help get Indigenous, remote and northern communities off diesel.

13 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term: a) First Ministers direct that reports be developed by working groups to identify options for action in four areas: clean technology, innovation and jobs; carbon pricing mechanisms; specific mitigation opportunities; and adaptation and climate resilience. Each working group will assess impacts on economic and environmental outcomes. The reports will be provided to the ministerial tables charged with overseeing their work, as outlined below, by September Ministers will review these reports and provide their recommendations to First Ministers by October 2016, and make the working group reports public.

14 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term: b) Working groups will be established in these four areas to prepare the reports. The working groups will be led by federal and provincial or territorial co-chairs, and will be composed of members from federal, provincial and territorial governments. Each of the groups will include Indigenous peoples in their work. The working groups will be encouraged to commission expert analysis and reports as necessary to support their work, and engage stakeholders.

15 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term: c) The Working Group on Clean Technology, Innovation and Jobs will provide a report with options on how to stimulate economic growth, create jobs, and drive innovation across all sectors to transition to a low-carbon economy, leveraging regional strengths. This working group will consider a range of policy tools to bring new and emerging technology and innovations to market, sustain a competitive economy, reduce GHG emissions, encourage growth and investment, and increase exports of clean technologies, services and expertise. Their work will be overseen by Ministers of Innovation and Economic Development, who will receive their report.

16 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term: d) The Working Group on Carbon Pricing Mechanisms will provide a report with options on the role of carbon pricing mechanisms in meeting Canada's emissions reduction targets, including different design options taking into consideration existing and planned provincial and territorial systems. It will consider various elements of carbon pricing policy, including coverage, comparability and stringency, as well as market transactions related to mitigation technologies and international trends in carbon pricing and markets. It will consider the effectiveness of various carbon pricing mechanisms to contribute to the certainty of emission reductions and their efficiency at achieving this objective at the lowest possible cost, and take account of particular challenges, such as those facing northern and remote communities. It will also address issues that are particularly important to industry and investors, such as predictability, and approaches to address interprovincial and international competitiveness, including carbon leakage. Their work will be jointly overseen by Ministers of Finance and the Canadian Council of Ministers of the Environment, who will both receive their report.

17 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term: e) The Working Group on Specific Mitigation Opportunities will provide a report with options on how to promote clean growth and achieve a range of ambitious reductions in key sectors, including large industrial emitters, transportation, electricity generation and transmission, built environment, agriculture and forestry, and government operations as well as individual energy conservation actions. The working group will also look at approaches to internationally transferred mitigation outcomes, in the context of the Paris Agreement. The working group, supported by technical sub-groups, will consider various emissions reduction opportunities, taking into consideration existing and planned policies. Their work will be overseen by the Canadian Council of Ministers of the Environment, who will receive their report.

18 2. Working together to build on provincial and territorial actions by identifying measures that governments could take to reduce emissions and grow the economy in the longer term: f) The Working Group on Adaptation and Climate Resilience will provide a report with options on a comprehensive approach to adapt to the impacts of climate change, support affected communities and build greater climate resilience. This working group will identify specific priorities in support of approaches to climate change adaptation, including disaster mitigation and conservation, and will consider a range of policy tools to foster research, innovation and investments in resilient infrastructure; integrate information, expertise and best practices from Indigenous peoples; and support the development of jurisdictional policies. This work will be overseen by the Canadian Council of Ministers of the Environment, who will receive their report.

19 3. Working together on Energy Efficiency and Clean Energy Technology and Innovation: a) Federal, provincial and territorial Energy Ministers will collaborate on specific actions being undertaken through the Canadian Energy Strategy, including energy conservation and efficiency, clean energy technology and innovation and delivering energy to people and global markets, in order to contribute to the pan-canadian framework on clean growth and climate change. b) The Government of Canada will advance the harmonization of energy efficiency standards and development of innovative approaches across Canada and with North American partners.

20 4. Engage Indigenous peoples in the development of the pan-canadian framework on clean growth and climate change a) The working group process will be complemented by a broader engagement process with Indigenous peoples.

21 5. Engage the public in the development of the pan-canadian framework on clean growth and climate change a) The public, including youth, will be engaged using online tools in particular to solicit input and to increase climate change awareness and literacy.

22 6. First Ministers will meet in fall 2016 to finalize the pan-canadian framework on clean growth and climate change, and review progress on the Canadian Energy Strategy. DATE MODIFIED:

23 Excerpts from: Transitioning to a lower carbon future GHG reduction in Canada & Alberta What s Possible by 2030? Alberta Renewable Energy Alliance Presentation to Calgary Renewable Energy Meetup February 20, 2016

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25 Two Alberta Government documents on Climate Leadership were released in 2015 Discussion Document for Public August, 2015 Report to Environment Minister November 22, 2015

26 Alberta s Climate Change Action Plan announced in September 2015 was to be Ambitious Effective Achievable

27 Climate Leadership Report to Minister Nov 22, 2015 recommended an Alberta goal for 2030 = 270 MT (an increase of 3 MT above 2013 emissions) 2013 = 267 MT = 234 MT

28 AREA s Poll of what Alberta s Goal for 2030 GHG emissions SHOULD BE (megatonnes CO2e / year) Minimum 190 Maximum 250 Average 217 Median 215

29 Provincial 2030 GHG Targets (as of December, 2015) BC 40% reduction from 2007 levels Ontario 37% reduction from 1990 levels Quebec 37.5% reduction from 1990 levels Manitoba 33% reduction from 2005 levels Alberta 17% increase from 2005 levels Saskatchewan not declared New Brunswick not declared Nova Scotia not declared Prince Edward Island not declared Newfoundland/Labrador not declared

30 Annual GHG emissions (MT CO2e per year) Canada could achieve our UN Commitment of 524 MT if Alberta emits 217 MT (not 270 MT) in 2030 and five not declared provinces reduce by 33% below 2005 levels 524 MT 270 MT 217 MT MB NB NS PEI NL & L BC Sask Quebec Ontario Alberta

31 AREA recommends Alberta s 2030 Goal should be 217 MT = 9% below 2005 levels (50 MT reduction from current levels of 267 MT) 2013 = 267 MT 2030 = 217 MT

32 NIR 2015 Canada is required under the UN Framework Convention on Climate Change to submit an annual report in GHG emissions from all sectors within Canada. This NIR (National Inventory Report) 2015 is the most recent report released in May of 2015 and reports on emissions from 1990 to 2013.

33 Canada s Sector GHG emissions for the year 2013 Alberta s Sector GHG emissions for the year % of 2013 GHG emissions arose from these sectors

34 Canada 85% of Canada s GHG emissions arose from these sectors Total vehicle emisisons = 122 MT

35 Alberta 85% of Alberta s 2013 GHG emissions arose from these sectors

36 GHG emissions in 2013 from 15 high emitting sectors Alberta Rest of Canada Petroleum Refining Non-Energy Products from Fuels and Solvent use Agricultural Soils Direct Sources Solid Waste Disposal on Land Alberta s 2013 high proportional GHG emissions Methane from cattle / Enteric Fermentation Commercial & Institutional 6 29 Off-Road Diesel Light-Duty Gasoline Vehicles 4 39 Heavy-Duty Diesel Vehicles Light-Duty Gasoline Trucks Residential Manufacturing Industries fugitive emission -Oil and Natural gas electricity and heat generation mining and upstream oil and gas Million Tonnes CO2e per year

37 2013 Canadian GHG emissions can be reduced by 202 MT to achieve Canada's Paris commitment of 524 MT by emissions totalling 524 MT Reductions to reduce 202 MT by 2030 Reduce Fuels consumed during Metal Production by 15% Reduce emissions from Solvent use by 50% Reduce fuel consumed for Petroleum Refining by 15% Reduce emissions from waste disposal by 30% Reduce emissions from crop residue and manure by 30% Reduce methane released by cattle by 5% Reduce Fuel use in commercial buildings by 15% Reduce Fuel use in residential buildings by 15% Reduce emission from fuels used for manufacturing by 5% Reduce fugitive emissions from Oil and Natural Gas by 70% Reduce Emissions from Electricity Generation by 67% Reduce Fuel consumed for Oil and Gas Production by 25% Reduce all remaining GHG emitters by 15% Reduce road transportation emissions by 15% The values at the end of the bars represent the GHG emissions in 2013 and total 726 MT CO2e Annual GHG emissions (MT CO2e per year)

38 Annual GHG emissions (MT CO2e / year) 2013 November Climate Leadership Report Forecasts 270 MT Annual GHG emissions in Alberta in Cogeneration electricity CO2e 270 MT agriculture & waste buildings manufacturing transportation electricity excluding cogen emissions oil & gas oil sands including cogen emissions

39 Annual GHG Emissions (MT CO2e / year) AREA recommends Annual GHG reduction opportunities In Alberta to achieve 217 MT CO2e in Note: cogeneration emissions from oil sands are allocated to electricity in MT agriculture & waste buildings manufacturing transportation electricity oil & gas oil sands

40 Is 217 MT by 2030 ambitious, effective and achievable? Climate Leadership Report goal of 270 MT is neither ambitious nor effective AREA s goal of 217 MT is ambitious, effective and achievable.

41 Examples of Incentives to foster Investment Value adjusted RECs (Renewable Energy Certificates) generated within Alberta and awarded higher premiums for: Low emissions; Proximity to load; Ability to deliver during peak time of day loads; Ability to be dispatched on short notice. Discriminate Carbon Offsets (related to SGER but should not be limited to the current single current offset number of 0.59 tne CO2e / MWh) Output Based Allocations relating to a new Carbon Competitive Regulation (CCR) in which a carbon price is applied to sector specific industrial emissions Competitive bid (auction) process whereby generators offer to sell renewable capacity (or generation) for a set period during which the government commits to purchasing such capacity (generation) while retaining the right to all related environmental attributes.

42 To meet our Climate Action Commitments in Alberta The Federal, Provincial (Alberta) and Municipal governments should do the following urgently, by using Federal Infrastructure funds, and monies from the Alberta Climate Change and Emissions Management Fund: Establish an agency that will provide: zero to low interest loans to residential and commercial investors who wish to install energy conserving items and renewable energy systems (< 1.0 MW) such as solar, combined heat and power and geo-exchange systems in their homes and businesses; rebates to those investors who implement energy conservation and renewable energy to permit payback of those investments within a reasonable period of time, i.e., one to 10 years; grants to training institutions such as SAIT and NAIT to provide programs for tradespeople to learn the skills required to install the energy conserving items and renewable energy systems; grants to oil and gas companies that set up divisions within their organizations that broaden the corporate mandate of hydrocarbon production to embrace renewable energy production and retain and retrain staff in this transition period. Tens of thousands of good jobs are available, starting now.

43 Renewable Energy Job Opportunities in Alberta 2016 to 2030 *source (NREL National Renewable Energy Laboratory) RENEWABLE TECHNOLOGY ADDED BY 2030 Added Capacity (MW) Unit Cost ($ / kw) Investment Opportunity ($Millions) Jobs per $Million Invested* Forecast New Jobs Wind 7,500 $2,000 $15, ,500 Solar 4000 $2,500 $10, ,000 Geothermal 1000 $5,000 $5, ,000 Bioenergy 250 $4,000 $1, ,500 Small Hydro 300 $5,000 $1, ,450 Energy Storage 1500 $2,500 $3, ,875 TOTAL 14,550 $36, ,325

44 A Roadmap to 2030 Canada s should meet its Paris Commitment of 524 MT CO2e by 2030 (as a minimum). Alberta should meet a Goal of 217 MT CO2e by 2030 (as a minimum). These goals should be constantly reviewed in a process to ensure that there is annual progress toward the targets. To meet 2030 goals we must focus specifically on major emission sectors. We must devise sector specific strategies to achieve our goals.

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46 End of Excerpts from February 20, 2016 AREA Presentation to Calgary Renewable Energy Meetup:

47 AESO questionnaire Comments due March 24, 2016

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49 1. Tell us about yourself a. Please provide you name, contact information the organization you represent, and your interest in responding to the AESO s questionnaire (developer, investor, association, other, etc.)

50 1. Tell us about yourself b. If you are a developer please indicate: 1. the type of renewable electricity generation project that you may be interesting in pursuing; 2. The anticipated size of such project; 3. Your preferred region within the Province for siting your facility; 4. Whether you have invested in electricity generation in Alberta in the past, and summary details with respect to such investment and 5. Your organization s current renewable electricity generation portfolio (type and MW) and the applicable location/jurisdiction of the projects within such portfolio.

51 1. Tell us about yourself c. Please identify whether you currently have renewable projects in the AESO connection queue and if so, the relevant stage.

52 1. Tell us about yourself d. If you are not a developer please indicate your interest.

53 2. Tell us about your view on investing in electricity generation in Alberta a. What do you anticipate might be barriers to investing in renewable electricity generation in Alberta? What are your recommended proposals to address or mitigate against such barriers?

54 2. Tell us about your view on investing in electricity generation in Alberta b. What do you view as key risks associated with investing in renewable electricity generation projects in Alberta?

55 2. Tell us about your view on investing in electricity generation in Alberta c. What key information is necessary for you to have prior to making a decision to invest in Alberta?

56 2. Tell us about your view on investing in electricity generation in Alberta d. Do you anticipate investing in non-renewable electricity generation in Alberta? What would influence you decision to invest in nonrenewable generation, renewable generation, or both?

57 3. Tell us about your plans if you were to invest in renewable electricity generation in Alberta a. Describe the key activities and timelines associated with the development, regulatory approval and construction of your anticipated renewable electricity generation project(s) (i.e. from inception through to energization).

58 3. Tell us about your plans if you were to invest in renewable electricity generation in Alberta b. Assuming your project is selected by the AESO prior to the end of Q1, 2017, do you foresee any material barriers to energizing your project prior to the end of 2018?

59 4. What is your view with respect to technological advances that may be on the horizon for the renewable sources of generation that are of interest to you?

60 5. General Comments a. Based on the description of the Renewable Electricity Program described on the AESO website, please provide your general comments and feedback. Please save the completed questionnaire and to

61 Comments? Debate

62 Four factors that affect the value of electricity should be incorporated into Alberta s electricity market. DISPATCHABLE (High Value) e.g. Geothermal, Energy Storage CLOSE TO LOAD (High value) e.g. Rooftop solar High Value farther from centre NOT FAR DISPATCHABLE HIGH EMISSIONS OFF PEAK ON PEAK TIME (High Value) e.g.solar LOW EMISSIONS (High Value) e.g.solar, wind, geothermal, hydro, bioenergy

63 Four factors that affect the value of RECS or Offsets should be evaluated for Alberta s electricity market. CLOSE TO LOAD (e.g. Rooftop solar) DISPATCHABLE (e.g. Geothermal, Energy Storage) High Value ON PEAK TIME OF DAY (e.g.solar) LOW EMISSIONS (e.g.solar wind geothermal hydro, biomass)

64 1. Low Polluting Points assigned for Value in each of Four Categories 2. On Peak 3. Close To Load 4. Dispatchable Total points Wind Geothermal 3 Score from 3 0 to a maximum 3 of 4 points 9 Solar 4 in each 3 of the 3 four categories 10 Hydro The highest score could be 16 points Bioenergy Energy Storage

65 1. Low Polluting Points assigned for Value in each of Four Categories 2. On Peak 3. Close To Load 4. Dispatchable Total points Wind Geothermal Solar Hydro Bioenergy Energy Storage

66 Assigning Value to each of four Categories low polluting on peak close to load dispatchable Energy Storage Bioenergy Hydro Solar Geothermal Wind Points awarded for each of four categories

67 Potential Value of Renewable Energy ($ / MWh) Relative Value of various renewable generators (measured in $/MWh) $ year simple payback on Capital Cost ONLY 10 year payback on Capital AND Operational Costs 10 year PPA awarded on four value categories $200 $150 $136 $135 $175 $168 $165 $152 $157 $150 $137 $135 $211 $210 $200 $100 $69 $86 $90 $100 $103 $50 $- Wind Geothermal Solar Hydro Bioenergy Energy Storage

68 RECs, offsets and Competitive Bids The current Halkirk and Black Spring Wind Farms generate unbundled RECs which are sold to California under a 20 year PPA. Should Alberta allow RECs to be unbundled from the electricity component and permit sale to entities outside of Alberta? Or should Government of Alberta (GOA) use Alberta Carbon fees to purchase and retire Alberta RECs? Should Renewable Generators be encouraged to submit bids to the power pool separate from their REC value? Should Generators bid via a Day Ahead Market (as opposed to hourly settlement)? Should Renewable Generators offer their electricity in a monthly or annual energy block? Should RECs govern renewable generation or should the offset market play a part?

69 How does Ontario price renewable generation? In 2008 established the Feed In Tariff (FIT) program which guaranteed generators a fixed premium price for Renewable Generation for 20 years; (was as high as $802/MWh for rooftop solar < 10 kw.) Have recently moved to a competitive bid process where RE generators submit their proposed energy prices coupled with plans to ensure community engagement. The Govt of Ontario commits to purchasing the RE power and the right to the environmental attributes for 20 years. The lowest price bid (with extra points for community engagement) wins. Average WIND bids announced March 10 th were $86/MWh Average SOLAR bids were $157/MWh

70 Ontario s Renewable Generation Competitive Bid Results announced March 10, 2016 Eleven companies will be offered 16 contracts to build five new wind projects, seven solar projects and four hydroelectric projects, for a total of 455 megawatts of new power capacity, Ontario s Independent Electricity System Operator (IESO) said Thursday, March 10, Unlike in the past, when developers of large projects received government-set prices for the power they generated, the new competitive system saw contracts go to those promising to sell power for the lowest price although other factors such as community support, local energy needs and participation by aboriginal communities were also taken into account. Thirteen of the 16 contracts have participation from one or more indigenous communities, the IESO said. The prices in these contracts are far below what the province paid for power under the old Feed-In Tariff (FIT) program, which was established almost a decade ago to encourage a shift to renewable development. The cost of wind and solar technology has fallen, and the need for more power projects has slowed, so the new system of competitive pricing for large projects reflects that. On average, the new wind power projects will get 8.59 cents a kilowatt hour of electricity generated. Under early contracts in the FIT program, wind developers received more than 13 cents a kwh. Solar power costs have fallen even further. The solar projects chosen by IESO will get an average of cents a kwh for their electrical production, compared with more than 40 cents for large solar projects under the early FIT contracts. (The fixed-price FIT program is still in place, but only for very small renewable projects.)

71 What should govern? 1) A Renewable Percentage of Total Generation E.g 30% to 50% renewable generation by 2030? Known as RPS (Renewable Portfolio Standard) OR 1) A Goal to achieve an emissivity (Carbon Dioxide emission intensity) of E.g. 0.1 to 0.15 tne CO2e / MWh by 2030? Canada s average grid emissivity is < 0.15 tne CO2e/MWh due to large amount of hydro.

72 Annual Alberta Generation (GWh per year) 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 - AREA s Forecast for Generation in Alberta 2016 to 2030 If coal generation is suspended by 2025 (100,000 GWh in year 2030) not including imports 1,090 3,206 8, ,050 2,122 2, ,000 3,200 1,100 2,737 2, ,000 1, % 7 3,471 10,500 6,450 1,750 20,000 44,442 = % Renewable Generation 10% 38% 50% ,300 30,000 23,000 19,000 2,300 32,000 2,600 3,369 27,000 15,500 2,300 32, Energy Storage Bioenergy Geothermal Hydro Solar Wind CCGT SCGT Cogeneration Coal

73 Annual GHG emissions (MT CO2e) AREA's Forecast GHG emissions from coal and gas generation. CO2e can be reduced 69% from 54 MT in 2014 to 17 MT in 2030 If coal units are closed by 2025 and newer coal units are repowered with natural gas CCGT SCGT Cogeneration Coal

74 Current average Canadian emission intensity = 0.15 tnes CO2e/MWh Grid emissivity should be legislated which reduces the GHG emissions over time?

75 Conclusions 1) Reduce emissions from electricity generation Alberta should set a goal to increase low polluting renewable electricity generation by either: a) Legislating an RPS (Renewable Portfolio Standard) requiring a specific percentage of Renewable Generation by 2020, 2025 and 2030 ; AREA recommends 20%, 35% and 50% respectively OR b) Legislating that the GHG emission intensity of power generation in Alberta measured as tnes CO2e/MWh shall be reduced by a specific percentage by 2020, 2025 and 2030; AREA recommends 30%, 55% and 75% respectively

76 Conclusions 2a) Acknowledge the higher value of Renewable Generation High Value should be given to Renewable Electricity Generation based on four factors: 1. Emits zero to low pollution during generation*; 2. Is situated close to load; 3. Produces during on peak time of day loads; 4. Is dispatchable within minutes. * Devaluation should be applied to pollution that may occur in areas where the supply and/or fabrication of components of renewable energy systems is not controlled through environmental legislation (pollution havens).

77 Conclusions 2b) Acknowledge the higher value of Renewable Generation Consideration should be given also to awarding Renewable electricity generators exhibiting high EPRs (Energy Payback Ratio)* a higher value for electricity generated. Studies should be conducted to document and compare the EPRs which vary considerably among renewable generation technologies: For example, small hydro generation (less than 20 MW) has a far higher EPR (greater than 50) than solar photovoltaic (approximately 10) * Energy Payback Ratio is defined as the energy generated during the operating life of the generator divided by the energy consumed during the fabrication, operation, and decommissioning of the generator.

78 Conclusions 3) A Competitive Bid Process should be tested in Alberta Alberta should test investor enthusiasm for developing renewable energy generation in the Alberta by consulting with colleagues in Ontario regarding the efficacy of the Large Renewables Procurement process in Ontario; An assessment should be conducted of how a government entity (e.g. Alberta Balancing Pool) could purchase capacity or generation, (including all environmental attributes) from renewable energy suppliers in Alberta for a fixed term (e.g. 10, 15, or 20 years) via a competitive bid process; Bids with the following capacities for renewable generation should be sought: Wind = 500 MW Solar = 100 MW Geothermal = 20 MW Small Hydro = 20 MW Bioenergy = 20 MW Energy Storage = 20 MW

79 For questions please contact: Ken Hogg M.Eng., P.Eng. mobile