Natural Resources Committee on Sept. 27th, 2017

[Prof. Bryson Robertson]

Yes. When I look at that, I guess I should put it in the context of storing unused energy. Rather than us storing California's power, we're simply using California's power in British Columbia and not running our dams. We've managed to keep more water behind the dams, stored, as opposed to actually taking power from California, pumping water uphill or something of that sort, in the west coast perspective.

Storage is going to become incredibly valuable. I think if we look around the world at decarbonization strategies, they all are calling for increased availability of storage.

[Ted Falk, Conservative, Provencher, MB]

That's the problematic thing, I guess, with wind and solar. We have to consume the energy immediately as it's produced.

[Prof. Bryson Robertson]

Correct. My earlier comment was that our zero-carbon energy generation sources are cost-competitive, or will very soon be cost-competitive. But the generation resources that we can call on at any instant, at any time, the flexible generation resources, other than large-scale hydro, are not economically feasible right now. If we utilize interties to reduce our requirements for storage, or the high utilization of storage requirements that we have, there's your biggest bang for your buck.

[Ted Falk, Conservative, Provencher, MB]

Okay.

Mr. Bateman, you mentioned the cost-competitiveness of the different types of energy being produced. Solar, wind, and hydro are becoming much more competitive. What kind of amortization or life cycle are you basing that on for solar and wind?

[Patrick Bateman]

I can speak to solar. Typically, the amortization cycle used is about 25 years. The reason for this is that manufacturers provide a warranty for 25 years.

[Ted Falk, Conservative, Provencher, MB]

That's a full warranty? Each panel is warranted for 25 years?

[Patrick Bateman]

The numbers can differ, but typically it's to 82% or 83% of performance. After 25 years it would still be producing at 83% of its rated capacity.

[Ted Falk, Conservative, Provencher, MB]

Okay.

Are the power utilities that you represent through your association satisfied with the interties available to them when they produce solar power?

[Patrick Bateman]

To answer that, Mr. Falk, I think I'll build on one of your questions to Mr. Robertson. With very low levels of penetration of wind and solar, the transmission just simply isn't required. Storage isn't a problem, because the demand is there and it soaks it up. When you begin to have higher penetrations of wind and solar, that's when the interties are required.

A direct response to your question is that right now they are satisfied, but if we do build out more wind and solar, then they will need storage, be that hydro dams or batteries, curtailment, a variety of different solutions, or interties. In most modelling exercises that I've seen, strategic transmission has been one of the things that are best able to manage higher penetrations of wind and solar.

[Ted Falk, Conservative, Provencher, MB]

Okay.

Mr. Metcalfe, I'd like to ask you a question as well. You talked a little bit about AC power and DC power. I believe you said that DC transmission lines were very expensive to construct. Can you tell me about the advantages and disadvantages to either one?

[Malcolm Metcalfe]

Sure. The AC lines are excellent for short distances of up to perhaps 1,000 miles. If you get anything beyond that, you have to deal with stability issues.

With DC transmission, you can go a very long way. One of the longest lines we have in North America goes from Los Angeles to Oregon, and it's a DC line. The advantage of DC is that the systems can essentially run isolated. Quebec, for example, is completely isolated from the rest of the North American grid, because they connect—through New Brunswick in some cases, through Ontario in others, and directly in others—only with DC transmission.

DC transmission lines are expensive because of the converter stations. You have to put a converter station at each end, and you also have to have an AC source available at the end to help that converter station work. They are a bit more complicated, but in fact, if you are going to start tying the Canadian provinces together, you are going to find that the U.S. is divided into two.

[The Vice-Chair, Conservative, Shannon Stubbs]

Thank you, Mr. Metcalfe.

Mrs. Mendès, go ahead.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Thank you very much, Mr. Metcalfe. I will pursue that because I was quite interested in it. How do you balance...? Hydro-Québec has been mentioned as being completely isolated. Why is that? I come from Quebec, so that interests me. Why are they isolated, and what benefit does it bring to them, if any?

[Malcolm Metcalfe]

That's a great question.

Actually, at the time that happened, BC Hydro was developing northern transmission, and they made the decision to spend the money to remain connected solidly to the U.S. at all times.

Hydro-Québec looked at the same problem and decided that they would isolate themselves, because they have very long lines going up to their northern hydro plants. It was cheaper for them. They would have had to go to over one million volts. Right now, they have 765 kilovolt lines. That's three-quarters of a million volts up there now. They chose to do it that way.

The irony is.... You asked what Quebec gets from that. I'll tell you exactly. Quebec does have more outages than Ontario has—they have gone black a number of times—but when they go black, they have a hydro system that can recover in a matter of a few hours. When you have a blackout in Quebec, the lights come back on quite quickly. If you have a blackout in Ontario, you may be out for a week. The reason for that is the difference between a hydro system and a thermal system, which is the eastern interconnection.

In Canada, if we are going to use DC lines.... The U.S. is fundamentally divided into two, the eastern interconnection and the western interconnection, and they are essentially isolated. If we happen to have a small line going from Alberta, for example, through Saskatchewan to Manitoba, we would ultimately be connecting the whole eastern U.S. with the whole western U.S., and the line would break somewhere in between.

What we need to do is take care of that, and probably use DC.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

That's a little more complicated for how I understand it, but okay. Wonderful.

Going back to the interconnectedness and the interties that we need in order to make the system more accessible to all Canadians, how would you recommend that we go about this? This is not an easy solution.

[Malcolm Metcalfe]

No, I don't think it's that difficult. I actually think you could put a strong DC tie-line between Quebec and Ontario, a strong DC tie-line between, perhaps, Manitoba and Saskatchewan, and more AC tie-lines between Alberta and B.C., because somebody has already discussed the potential to help each other between B.C. and Alberta. Certainly, there is a lot that could be done there.

Where you are risking connection of two very big systems.... I teach electric power systems, and I compare this to two elephants running down the road, tied together by a thin piece of thread. It doesn't take much of a divergence to break it.

The advantage of DC is that it would allow you to shift power back and forth without a big problem. If you look at Europe, England is connected to Europe all with DC lines, and that's exactly why.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Would you have anything to add to that, Mr. Robertson?

[Prof. Bryson Robertson]

I think it's on point. My only comment there would be if we look at our transmission networks across North America, we have to remember that there are huge transmission networks north and south, and there's good reason for that. We're heavily connected to our southern neighbours, so when we're looking at pan-Canadian frameworks and visions, doing it in isolation of what the Americans are doing is misguided because they dominate what happens.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

So nothing comes from population.

Thank you very much.

[The Vice-Chair, Conservative, Shannon Stubbs]

Now we'll go to Mr. Schmale, for five minutes.

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

That's perfect. Thank you, Madam Chair.

I might as well finish up with Mr. Bateman, and then I'll ask my question to Mr. Metcalfe.

According to the IESO's August 2016 report on the state of the electricity system, that was the 10-year review, the Province of Ontario is a net exporter of electricity. I think we all know that. Electricity is sold in many cases at pennies on the dollar. We have businesses here paying more for hydro than they should and then subsidizing their competitors across the border.

I looked at your September 16 presentation on YouTube. You're in Alberta. Some of the interesting things you said.... I was struck by your response to a question from the audience about why rural Ontarians pay more than urban Ontarians. Your answer, if I'm quoting this correctly was related to the proximity and the cost of getting power to those rural users. And we often hear that when it comes to the price of a litre of gasoline, it costs more to get fuelled in Haliburton than it does in Scarborough.

Further in your presentation, you speak to the reliability of power and specifically that the concerns regarding the reliability of wind and solar can be mitigated by the sheer number of wind turbines and solar panels that are spread across the province of Alberta. Presumably in Ontario those panels and turbines would not obviously be spread out among Yonge Street and Bay Street, but they would be spread out in rural Ontario. So under the 2009 Green Energy Act, and as pointed out by the Auditor General, Ontario agreed to pay solar power and wind turbine operators as much as 10 times the market rate for electricity they produce under 20-year contracts. Then you spoke to the warranty issue, which I believe is one of the reasons they chose that.

If we're going to put rural Ontarians with the burden of housing acres upon acres of wind turbines and solar panels, in your opinion, wouldn't it be better for all concerned, rural Ontarians, the ratepayers, the solar industry itself, that we hold off on spending money to improve the entire system, a system to sell subsidized power at a loss and perhaps instead focus on investing that money in the technology needed to store? I believe Mr. Robinson, Mr. Metcalfe, and you did too, Mr. Bateman, pointed to capturing that electricity and allowing it to be captured.

Wouldn't that reduce the number of panels and turbines needed and reduce the need for subsidies and make a profit for Ontarians?

[Patrick Bateman]

I would respond to two central planks. The first one is innovation versus deployment. Do you support the innovation now or do you support the deployment? In my opinion, there's a role for federal and provincial governments, all levels of government, in both right now. In reality, our 30% by 2030 emissions reduction targets is approaching quickly, so the innovation is not enough to get us there. I would recommend a strategy on both fronts, the innovation and the deployment.

With respect to the burden or opportunity for rural landowners or municipalities, given that a lot of renewable energy development is currently focused in Alberta, I would point toward a lot of the rural municipalities that are competing for the investment and the opportunity to host the facilities as well. I think that goes hand-in-hand with responsible development, responsible siting, and so on. It's not always the best news story that it could be, but I think there are examples of willing hosts across Canada that do want to benefit from the property taxes and from the local jobs and so on as well.

[Jamie Schmale, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

Wouldn't it be better, based on the fact that in solar, as we talked about, the panels have high levels of toxic chemicals used...? You did say that technology is getting better, and I accept that. A wind turbine plant in Tillsonburg, Ontario closed this past summer. It put 350 people out of work, because the subsidies were basically drying up. They didn't actually go outside Ontario for the work.

How do you see this going forward? Wouldn't it make more sense to invest in ways to generate power in areas that could be more sustainable and reliable? I do understand the comment from Mr. Robertson about the interties, and I do believe that's perfectly said.

Why would we continue to, in my opinion, over-subsidize an industry when we already have an oversupply of energy that we have access to with interties, which we can then sell and actually make money from for Ontarians?

[Patrick Bateman]

The comment I would make in response to that statement is that there's an enormous opportunity from clean growth, and with all governments working together, there's an opportunity to benefit from that.

[The Vice-Chair, Conservative, Shannon Stubbs]

Thank you, Mr. Bateman.

Now, we'll move to Ms. Rudd for five minutes, and then afterwards, we'll go to Mr. Weir, for three minutes.