Creating a Market for Renewable Natural Gas

Transcription

1 Creating a Market for Renewable Natural Gas Neil Dobson Renewable Natural Gas Manager January 31, 2014

2 Agenda Introduction Update on the program RNG model in BC and FortisBC s role Who are the customers? Marketing the program Looking into the future How you can help

3 Introductions New RNG program team Scott Gramm, Manager, Renewable Energy Neil Dobson, RNG Sales Manager Brent Jaklin, RNG Operations Manager John Turner, Director, Energy Solutions Kristen Mucha, Senior Manager, Energy Solutions

4 Program update 2013 Results: 100,000 GJ supply and demand 6,500 residential and 150 commercial customers buying 10% blend 2014 Permanent program approved by BCUC Total seven projects delivering 530,000 GJ supply approved Upper supply cap of 1.5PJ approved EOI for new projects in Q New blends / tariffs approved RNG rate must now include all program costs Kelowna landfill operation in Q2

5 Gigajoules (GJ) Supply vs Demand 1,000, , , , , , ,000 MetroVan Seabreeze Farm Dicklands Farm Earth Renu Kelowna Landfill Salmon Arm Landfill Fraser Valley Biogas Moderate Demand Scenario High Demand Scenario Low Demand Scenario 300, ,000 Approved Supply 100,

6 Model for the RNG program in BC

7 Voluntary program with FortisBC flowing through costs Supplier Distributor User Long term Contract with margin No contract/ No additional margin

8 Building the market Marketplace research Market potential Testing different models Undertaking the pilot program for the last three years Marketing Budget Collateral Media Working with the BCUC and government

9 Market Potential With User Pay Pricing Model (Best Case Scenario) Percent of residents who would sign up for program 7% 10% 18% 20% 27% 14% 58% $60 / 70% premium / 100% reduction greenhouse gases $30 / 35% premium / 50% reduction greenhouse gases $18 / 20% premium / 30% reduction greenhouse gases $12/ 15% premium / 20% reduction greenhouse gases $6 / 10% premium / 10% reduction greenhouse gases Dislike all prices Would not participate in RNG Program Calculated based on 530,000 FortisBC residential customers in BC Mainland, as per October ** Per month. Computed by multiplying the number of households who would sign up against the average price increase.

10 Residential Customers

11 Current residential customers 75% heard about the program through bill inserts AIR MILES was a strong incentive More than 30% said yes to offer higher % blends Greener motivations for signing up

12 Profile of Current RNG Customers 50+ year old, married with kids (teen or older) Living in detached or semidetached homes in suburban and small towns (Surrey, Langley, Abbotsford, Nanaimo, Prince George) Socially conscious and trying to do their part to make a difference in their community English speaking 2 nd and 3 rd generation Canadian with European background Household income $80K+

13 Customer marketing examples

14

15 Commercial Customers

16 Commercial Customers Businesses signing up are those that believe in running a sustainable business, or see brand advantage from doing so No noticeable pattern of industry or geography Ezra Cipes, CEO, Summerhill Pyramid Winery It s good for business on so many levels. It helps with brand loyalty and it s true to our brand

17 Green Leader Rewards: Creating added value for commercial customers

18 Advertising materials

19 Looking ahead for the RNG program

20 The program is liked and supported Likelihood To Sign Up For FortisBC RNG Program 2009 (n=799) 56% 38% 5% 1% 2012 (n=1003) 52% 39% 7% Decline Q5: (On a scale of 1 Not very likely to 10 Definitely) All things being equal, if FortisBC offered a RNG program?

21 Challenges remain Price differential Political change of emphasis Substantial local supplies of natural gas Engaging consumers and overcoming key barriers Is it safe? Will I need a new boiler? Low awareness and familiarity (product misunderstanding) Total (n=449) 3% 10% 45% 38% 5% Was very familiar about it Had done some research on it Knew a little bit about it through advertisements Heard of it, but did not know anything about it Did not know it existed

22 Our plans for growing the program Update website and other marketing collateral Increasing focus on suppliers and the technology Redesign incentive programs AIR MILES and Green Leaders Launch new blends and tariffs Launch RNG into new markets RNGT Pursue industry accreditation such as LEED Continue to talk to municipalities and province about the role of renewable energy in energy/ sustainability strategies Work with industry groups and networks to create new routes to market

23 How can you support the program?

24 Contacts Scott Gramm, Manager, Renewable Energy Neil Dobson, RNG Sales Manager It s about listening to our customers and how this benefits the communities that we operate in Jerry Wyshnowsky, Thrifty Foods I commend FortisBC for being the first regulated utility in North America to offer renewable natural gas to customers. It s an innovative approach that allows their customers to take action on climate change in a simple, cost-effective way James Tansey, Offsetters

25 Questions?