Progress & Pathways Toward 30% Renewable Electricity in Alberta by st September 2017 (Edmonton)

Transcription

1 Progress & Pathways Toward 30% Renewable Electricity in Alberta by st September 2017 (Edmonton)

2 Progress to 30% by 2030 INTRODUCTION

3 at least 30% of the electric energy produced in Alberta, measured on an annual basis, will be produced from renewable energy resources. - Alberta Renewable Electricity Act (2016)

4 Is there some place where we can get the best of these three things the lowest cost, the lowest emissions and the highest reliability because you re not going to get them all at once, you re going to trade off between them - Calgary Herald (2016)

5 30% renewables by 2030 is achievable in Alberta both costeffecnvely and without compromising reliability of supply - CanSIA & CanWEA, Alberta Power Symposium (2016)

6 The progress of the past year connnues to demonstrate 30% renewables by 2030 is achievable in Alberta both costeffecnvely and without compromising reliability of supply - CanSIA & CanWEA, Alberta Power Symposium (2017)

7 Presenta1on Outline 1. Pathways & Market Segments. 2. Progress on Cost Effec1veness. 3. Progress on Reliability of Supply.

8 30% by 2030 PROGRESS & MARKET SEGMENTS

9 Climate Leadership Plan The Climate Leadership has made commitments to DeCarbonizing Alberta s Electricity System Coal Phase Out Introduc1on of New Renewable Genera1on Capacity 2/3 of coal capacity to be replaced by renewables Carbon Tax An output based alloca1on will applied to electricity

10 30% by 2030: Market Segments There are several new policies, procurements and programs in support of 30% by 2030 target: U1lity-Scale (e.g. AESO REP, AI NRFP). Distribu1on-Connected Genera1on: AUC Distributed-Genera1on Review. Community Energy. Micro-Genera1on.

11 ULlity-Scale: AESO REP Round 1 (1/2) Round 1 of AESO s Renewable Electricity Program will compe11vely procure 400 MW (new or expanded). 19 facili1es (~4,000 MW) have qualified (as of September 15, 2017) to submit a proposal in October Lowest cost facili1es will be contracted in December 2017 and will be in-service by December 2019.

12 ULlity-Scale: AESO REP Round 1 (2/2) Fixed 20 year Indexed REC with bid and pool price balanced by Carbon Levy. Low costs guaranteed: Compe11on (10:1). Revenue certainty. Reasonable Costs clause. AESO (2017) Renewable Electricity Program Recommenda1ons

13 ULlity-Scale: Beyond AESO REP Round 1 Details on future rounds of REP expected early AESO has commented that: They are working on a future pipeline of rounds. Rounds will be more frequent and may run concurrently. Rounds may target policy and socio-economic priori1es.

14 U1lity-Scale: AI Solar NRFP Since 2009, the Government of Alberta has met 100% of their electricity needs from renewable energy resources. NRFP will procure 135,000 MWh of solar electricity (>50% of 250,000 MWh for 1,500 government buildings and sites). Proposal submission due December 2017, contracts will be awarded March 2018 and facili1es in-service by March 2021.

15 U1lity-Scale: Federal 100% Renewables Federal Government have also commifed to powering opera1ons with 100% renewable resources by ,000 MWh of demand in Alberta, mostly Na1onal Defence (75%) and Agriculture & Agri-Food (15%). Alberta s de-regulated market ideal for bi-lateral power purchase agreement with u1lity-scale wind & solar.

16 DCG: AUC Proceeding AUC to conduct broad review into distributed genera1on (in accordance with O.C. 120/2017 in March 2017). Scope includes grid, billing systems, rates, tariffs, enablers, barriers, costs, processes etc. Interim report to Energy Minister (August, 2017) and final report (December, 2017).

17 DCG: Micro-Genera1on Regula1on Micro-genera1on Regula1on governs province s netbilling approach to customer self-genera1on. Enhancements to Regula1on enacted on January 1, 2017: Sizing flexibility: maximum size increased from 1 to 5 MW. Si1ng flexibility: meter aggrega1on and adjacent sites.

18 DCG: Community Energy Alberta Energy developing policy & regulatory framework for Community Energy. Approaches to Community Solar can enable capital, si1ng and sizing restric1ons to be overcome. Stakeholders ques1onnaire (July 2017), new policy & regula1on (2018) and poten1al EEA programs.

19 DCG: Residen1al & Commercial Solar Energy Efficiency Alberta s Residen1al & Commercial Solar Program provides $0.75/waf to eligible systems. Since program launched June 21, 2017: 42 projects have received support (<400 kw). 279 applica1ons in progress (4 MW, <$3 m).

20 DCG: Other Alberta Municipal Solar Program. Alberta Indigenous Solar Program. On Farm Solar PV Program. Residen1al No-Charge Energy Savings Program. Residen1al Retail Products Program.

21 Alberta Wildlife DirecLves for Wind and Solar Alberta Environment and Parks has developed Direc1ves to minimize adverse impacts on wildlife and habitat from renewable energy

22 30% by 2030 COST EFFECTIVENESS & RELIABILITY

23 Wind & Solar Growth and Progress Con1nues Globally* Wind & solar outpaced all other genera1on in 2016: Investment double fossil fuels for 5th straight year. Net-capacity addi1ons 40% higher than gas plus coal. Market share of total electricity genera1on grew to 5%. Forecasts of 34% global electricity market share capturing <75% of $10 tn. total investment by * Bloomberg New Energy Finance (2017) New Energy Outlook and Bloomberg New Energy Finance (2017) Global Trends in Renewable Energy Investment 2017

24 Progress to 30% by 2030 COST-EFFECTIVENESS

25 Wind & Solar Costs Declined 14% in 2016* 400 LCOE ($/MWh USD) Solar (Lazard 9.0 Average) * Lazard (December, 2016) Levelized Cost of Energy Analysis Wind (Lazard 9.0 Average) 2035

26 Wind & Solar Costs Declined 14% in 2016* 400 LCOE ($/MWh USD) Solar (Lazard 9.0 Average) 2020 Wind (Lazard 9.0 Average) * Lazard (December, 2016) Levelized Cost of Energy Analysis Solar (Lazard 10.0 Average) Wind (Lazard 10.0 Average)

27 and 65 & 85% resp. since 2009*. 400 LCOE ($/MWh USD) Solar (Lazard 9.0 Average) 2020 Wind (Lazard 9.0 Average) * Lazard (December, 2016) Levelized Cost of Energy Analysis Solar (Lazard 10.0 Average) Wind (Lazard 10.0 Average)

28 AB s New Wind & Solar In-Service post LCOE ($/MWh USD) 300 AIberta Infrastructure Solar NRFP (100 MW) by March AESO Renewable Electricity Program (400 MW) by December Solar (Lazard 9.0 Average) 2020 Wind (Lazard 9.0 Average) 2025 Solar (Lazard 10.0 Average) Wind (Lazard 10.0 Average)

29 % % % % Solar (Lazard 9.0 Average) 2015 Wind (Lazard 9.0 Average) * Alberta Electric System Operator (July, 2017) Long-term Outlook 2020 Solar (Lazard 10.0 Average) Wind (Lazard 10.0 Average) Propor1on of Total Genera1on (%) LCOE ($/MWh USD) and Long-term Outlook is for 23% by 2032.* 0% 2035 Propor1on Wind & Solar of Total Genera1on

30 % % % Majority of Wind & Solar in 2030 will have come online arer Solar (Lazard 9.0 Average) 25% 2015 Wind (Lazard 9.0 Average) 2020 Solar (Lazard 10.0 Average) * Reference Case in the Alberta Electric System Operator (2017) Long-term Outlook Wind (Lazard 10.0 Average) Propor1on of Total Genera1on (%) LCOE ($/MWh USD) and Long-term Outlook is for 23% by 2032.* 0% 2035 Propor1on Wind & Solar of Total Genera1on

31 New Genera1on Renewable vs Thermal

32 Conclusion: Cost-Effec1veness Pre-2022: Wind and solar costs con1nue to decline. 12% penetra1on = minimal impact on pool price. Post-2022: Coal re1rements reduces supply cushion (2012 regs.) Fuel sources at margin dictate cost increases/decreases. Capacity Market provides revenue certainty to natural gas.

33 The progress of the past year connnues to demonstrate that 30% renewables by 2030 is achievable in Alberta costeffecnvely

34 Economic Viability of Baferies Rapidly Approaching Bafery storage economics challenging gas peakers: 100 MW/129 MWh bafery in S. Australia (2018). 262 MW Puente gas plant in Oxnard, California (2020). 1,800 MW of gas plants for Minnesota (2028). Lithium bafery cost declines of <40% in next 5 years, with solar may be posi1oned to displace significant por1on of gas-peakers*. * Lazard (2017) Storage Analysis 2.0

35 Progress to 30% by 2030 RELIABILITY OF SUPPLY

36 Wind & Solar met >7% US demand in 2016*, 1,800 Genera1on (TWh) 1,600 1,400 1,200 1, Coal Natural Gas 2014 * United States Energy Informa1on Administrator (EIA) Nuclear 2015 Total Wind & Solar 2016

37 and ~9% March - May 2017,* 1,800 Genera1on (TWh) 1,600 1,400 1,200 1, Coal 2014 * United States Energy Informa1on Administrator (EIA) Natural Gas 2015 Nuclear 2016 Total Wind & Solar 2017 (January to June)

38 but 20 40% in several states in 2017.* Propor1on of Total Genera1on (%) 60% 50% 40% 30% 20% 10% 0% January Iowa Kansas February Minnesota * United States Energy Informa1on Administrator (EIA) March North Dakota April Oklahoma May Texas June Colorado California

39 but 20 40% in several states in 2017.* AESO s forecast of 23% wind and solar in 2032 being reliably demonstrated in 2017 Propor1on of Total Genera1on (%) 60% 50% 40% 30% 20% 10% 0% January Iowa Kansas February Minnesota * United States Energy Informa1on Administrator (EIA) March North Dakota April Oklahoma May Texas June Colorado California

40 Conclusion: Reliability US states already >30% wind & solar in Experience on reliability of variable gen. building: North American Electric Reliability Corpora1on (NERC) State of Reliability Brafle Group Advancing Past Baseload to a Flexible Grid. Analysis Group Electricity Markets, Reliability & U.S. Power System. US Dept. of Energy Staff Report on Electricity Markets and Reliability. General Electric Pan-Canadian Wind Integra1on Study. >23% wind & solar should pose no concern for 2032.

41 The progress of the past year connnues to demonstrate that 30% renewables by 2030 is achievable in Alberta without compromising reliability of supply

42 Solar Eclipses & Reliability Total solar eclipse in 2015 world s first experience with eclipse & significant solar grid-penetra1ons: 10 GW drop forecast in Germany, 2.7 GW in Italy. Total solar eclipse in 2017 offered new learnings: Sun par1ally obscured for California ISO. 3.6 GW for that hour, about 60% lower than normal. Decrease made up by imports and thermal genera1on.

43 Conclusion The progress of the past year connnues to demonstrate 30% renewables by 2030 is achievable in Alberta both costeffecnvely and without compromising reliability of supply - CanSIA & CanWEA, Alberta Power Symposium (2017)

44 Canadian Wind Energy Association CanWEA Canadian Solar Industries Association CanSIA Evan Wilson Regional Director, Prairies Patrick Bateman Director of Policy & Market Development