Yesterday, the Fraser Institute released a new report [.pdf], concluding that the Green Energy Act’s environmental goals could have been achieved in a more cost-effective fashion simply by improving the pollution control equipment on Ontario’s coal plants.
The report starts from an erroneous premise (one which the Government of Ontario has unfortunately repeated on occasion): that a key purpose of the Green Energy Act was to improve air quality by reducing conventional air pollutants from coal-fired generation. One problem with this is that the Green Energy Act was passed in 2009, years after the government had committed to phasing out coal and initiated other procurements – gas-fired generation, nuclear refurbishment, conservation, and renewables – to take up the slack. Given the several year lead time in bringing new projects online, any contribution to the coal phase-out from the Green Energy Act would be marginal at best.
No, the primary purpose of the Green Energy Act was to reduce greenhouse gas emissions and position Ontario as a leader in developing a low-carbon electricity system. Having more conservation and renewable generation in the system does not (at least at the moment) eliminate the need for some fossil-fueled generation, but it does reduce the amount of energy and greenhouse gas emissions that these units produce. By contrast, adding pollution control equipment to Ontario’s coal plants would have done nothing to reduce greenhouse gas emissions.
The Fraser Institute report then goes into some specific issues with one form of renewable energy: wind generation.
For example, it suggests that 80% of wind output is unneeded, because it is produced at times that Ontario exports power. This is a misunderstanding of how our electricity market operates. In many of these hours, there would be net exports whether or not wind was running, driven by higher power prices in other jurisdictions. In the much smaller number of hours when Ontario actually does have an electricity surplus, why is it always wind that has to take the blame? A glance at the mix of generation will show a large amount of nuclear, gas, and hydro running around the clock (most also with fixed price contracts), with wind almost never making up more than 10% of the total.
The report also suggests that we may need to turn off nuclear plants to accommodate renewables, which could lead to increased use of natural gas in subsequent hours as demand rises, due to the time lag in bringing nuclear units back on-line. This issue has already been dealt with by the Independent Electricity System Operator, by allowing nuclear operators to offer their non-flexible generation into the electricity market at a lower price than wind, ensuring that wind would be turned off first in the event of a surplus.
Let me be clear – wind alone cannot power our electricity system, and I don’t think anyone has ever said that it can. We need a mix of low-carbon options – energy supply, conservation and demand management, and storage – that can work together to meet our electricity needs.
Nevertheless, reducing the amount of carbon emissions produced by our electricity system was and is the right thing to do. The government shouldn’t be afraid to stand up and say so.