Peter Ronson, P.Eng. Vice President, Markham District Energy. November 2, 2015

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1 Peter Ronson, P.Eng. Vice President, Markham District Energy November 2, 2015

2 What is District Energy? Thermal Energy Grid: Heating & cooling energy (hot water & chilled water) is distributed to customers connected to the thermal grid in an underground piping network from a central energy plant. Energy used to heat & cool our building stock represents over 60% of energy usage in our urban centres.

3 The District Energy Industry in Canada 150 systems from coast to coast Oldest system: London (1880) Largest system: Toronto (Enwave) Most active province: British Columbia Ontario: Toronto, Markham, Windsor, Ottawa, Hamilton, Sudbury, Cornwall, Regent Park, Guelph, and campuses including York University & the University of Toronto.

4 The District Energy Industry in the U.S.

5 The District Energy Industry Internationally % 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

6 Markham District Energy Created in 1999 Owned by the City of Markham For-profit corporation Competitive business, non-rate regulated utility MDE produces hot water, chilled water & electricity It all started with the 1998 ice storm, as Markham considered ways to enhance its energy security and community resiliency; and at the same time attracting a major employer to Markham.

7 Markham Centre System (2000) 1000 acres greenfield development Multiple land-owners District energy anchor load: IBM software lab Eventual home to 40,000 residents, 40,000 jobs Full build-out: 30 million ft² mixed-use development 3 energy plants Total capacity: 32 MWth heating (hot water), 40 MWHth storage, 10,000 tons cooling, 1.5 MWe natural gas CHP

8 Cornell Centre System (2012) 250 acres greenfield development Multiple land-owners District energy anchor load: Hospital Eventual home to 10,000 resident, 10,000 jobs Full build-out: 10 million ft² mixed-use development 1 energy plant Capacity: 15 MWth heating (steam + hot water), 3,950 tons cooling, 5 MWth emergency power, 4 MWe natural gas CHP

9 District Energy Capital Assets Energy Distribution Building Power Plants Piping Connections

10 District Energy: Technology & Fuel Agnostic Hot Water (or steam) & Chilled Water Distribution: Thermal Grid Production Equipment: Boilers, chillers, waste heat recovery, absorption cooling, storage, free cooling, heat from Data Centres... Fuel Inputs: Natural gas, electricity, biomass, biogas, ground source, solar.

11 MDE s Future? Completing Markham Centre Completing Cornell Centre Developing New Systems Biomass Solar Combined Heat & Power

12 Why do communities develop & invest in DE? Financial Returns Economic Development Environmental Community Resiliency

13 Environment 70% 50% (47% to 53%) 35% to 40% The United Nations Environment Programme (UNEP) released a report on February 26, 2015 with this primary conclusion: transitioning cities to modern district energy systems could reduce primary energy consumption by 50% by 2050.

14 Resiliency Community resiliency is becoming a top priority for municipal leaders; particularly in areas that have experienced severe weather events. Climate change forecasts suggest that the frequency of these events will increase.

15 Energy Resiliency & Emergency Preparedness Thermal Grid (connected to mission critical buildings) Local Power Generation (natural gas) (including an emergency procedure to power these mission critical buildings)

16 How does district energy benefit our customers? Reduces Up-Front Capital Cost: No boilers, chillers, cooling towers, architectural space, engineering & commissioning. Competitive cost: We typically talk about DE being competitive (not cheaper) on a life cycle basis. Transfers risk of ownership: Understanding the true cost of ownership requires experience. Reliable supply: Typically more reliable than conventional systems. Recovers valuable space for other uses or amenities For specific customers, increasing useful space will trump any energy cost issues. Simplicity of building operations: Significant reduction in building equipment.

17 Key elements for a District Energy System Anchor Loads No perfect rule, but 1 to 3 million sq.ft. Minimum Density Does not work economically at small building scales Distance Short as possible, but likely less than 3 km

18 For more information: