Wednesday, October 27, 2010

Green power projects, now what?

There is a "perfect storm" brewing with respect to green power production in BC.

  • BC Hydro is once again in full control of the transmission grid
  • BC Hydro has started down the Site C project path and has become blinkered to all other power sources
  • The BC Hydro corporate culture is once again strongly for large projects and against small private projects
  • The NDP has made it clear that it is not open to the idea of more private power
  • The recent cabinet shuffle is going to mean months of uncertainty about who can make what decisions and as we get closer May 2013 the time between the permission to go ahead and the next government coming to power is too short to get into the ground and underway.

These five factors could see a dramatic slowing in more green power coming online in BC.   We will see an ongoing slowing in the green power business for the next four to five years.   What will push a resurgence in the business in the future is a growing demand in the Western Interconnect for carbon neutral electrical power.

Within five years there will be more demand to see coal fired power plants shut down and ideally gas fired ones as well.    At the same time demand will be rising in this region of the grid.   The ability of wind, geothermal, solar and wave to provide any significant portion of the power within the next decade is minimal.   Nuclear is going to become very popular and there may even be some projects started, but the lead time for nuke is very long.   The lead time for a large scale hydro project like Site C also takes years till it is online.  There will be a large demand for green power that can quickly come online and only one affordable source, run of the river power.

BC has a huge potential for run of the river power and no matter what happens in the next five years, the demand for this power will be there in 2015 even more so than now.   It is unfortunate that the industry is likely to go through a number of years of troubles before the political climate changes.

Tuesday, August 31, 2010

Paint your roof white and save the world!

This is an interesting story from the CBC today

All new roofs would be white under a Montreal borough's proposed bylaw aimed at taking advantage of a white roof's cooling effects.
Mayor Fran├žois Croteau of Rosemont-La Petite-Patrie wants to make white roofs mandatory on new buildings. Roofs requiring repairs would have to be painted white as well.
Croteau's idea is supported by a Concordia University engineering professor, who says all the world's roofs should be changed to cooling colours.
"Ten metres squared of white roof is equivalent, in cooling the globe, the equivalent to one tonne of [carbon dioxide]," Prof. Hashem Akbari says.
Akbari is trying to persuade 100 of the world's largest cities to switch to light-coloured roofs. Changing all the roofs in the world would be equal to getting rid of all the world's cars for 20 years, he says.
If Croteau gets his way, many of his borough's roofs will be white within about 15 years.
The bylaw would not apply to buildings with peaked roofs, which many residential houses have.
Croteau said making the switch to white roofs would be more expensive in the short term. But, he said, the cost would be offset eventually because white roofs are more durable.
Councillors in Rosemont-La Petite-Patrie will vote on the proposal in October.
In looking for this story I found some of the research that backs up the reasoning, I had no idea of the impact that changing the colour of the roof could have.   If there were a wholesale transition to white roofs, there would be a 33% reduction in the urban heat island effect.

Sarah Thomson, candidate for mayor of Toronto is backing this idea as well, though she is running a distant third of fourth.

You can even calculate the savings from moving to a light coloured roof from a dark one.

I like the idea of showing people that is saves money and not any sort of forced mandate.

Friday, August 6, 2010

The Economics of Site C

I am looking into the economics of Site C and I am interested in anything that anyone can point me in the direction of to make some real estimates of the cost of construction, operation and such.

Things such as:
Cost of the dam
Cost of the transmission lines
Cost of the rebuild of highway #29
Cost of the consultation process
Cost of replacing the agricultural lands
Cost of mitigation of erosion of the high river side banks by the resevoir
Cost of accommodating First Nation rights.

Please send me anything you might know of.

A Video showing Site C Reservoir

Over the next few weeks I am going to take a closer look at the Site C dam project and consider what impacts it may have.  

This is a video by the Treaty 8 Tribal Association showing the proposed reservoir for  the Site C project.  The reservoir will stretch from Fort St John to Hudson's Hope.  

One expense that comes to mind after watching the video is the cost of having to move Highway #29.   It looks like 30-40 km of the highway would have to be rebuilt and four major bridges.   My quick estimate is that about 100 acres of land that will need to acquired for the road right of way.

So what will cost to rebuild this highway?   My quick estimate is between $500,000,000 and $1,000,000,000.   The cost is mainly due to the bridges that will need to be built.   Is this cost factored into the cost of the dam?

Tuesday, July 20, 2010

Interesting Program to allow low income homes become more energy efficient

I found this on Craigslist today and thought it might be of interest to people:

The Government Wants to Help You Renovate!
The Energy Conservation Assistance Program (ECAP) provides BC Hydro residential account holders on limited budgets with a home energy evaluation, the installation of energy saving products, and personalized energy efficiency advice. All of this is free of change to the participant.
Every home is different. Your home evaluator will determine which energy efficiency upgrades your home is eligible for. The installation of some products may require multiple visits.
To qualify for this program you must be a BC Hydro residential customer with moderate to high electricity consumption (more than 8,000 kWh/yr, which is approximately an electricity bill exceeding $500 per year) living in the Lower Mainland, on Vancouver Island, or the Southern Interior.
Applicants must provide proof of income for every member of the household 18 years or older by providing a Notice of Assessment from the Canada Revenue Agency. Your combined household income must be below the Low-Income Cut-Off (LICO) as published by Statistics Canada. Low-income cutoffs vary by where you live (population) and by the number of people in your household.
You can view the LICO table on the Energy Conservation Assistance Program application form. This can be found on
Contact Information
Glenys Verhulst (250) 381 9995 x11
Eligibility: If you do not qualify for the ECAP program, you can order an Energy Saving Kit, sign up for a home energy assessment for LiveSmart BC grants, or check out the Affordable Warmth incentive database for other programs to help you make your home more energy efficient.

Monday, July 5, 2010

Oil and Gas coming to the Yukon?

Seems there is a push to start the development of some natural gas resources in Yukon.   A company called Northern Cross is proposing development of the resource for local use by mines in Yukon.

The development of this resource will bring more interest in oil and gas into the region and may lead to the construction of a pipeline from north eastern BC to Yukon.  It also is another further step down the road to the development of the oil and gas resources in the Mackenzie Delta and eventually the tar sands on Melville Island.

Until there is a lot more green electrical power and oil is no longer economically viable, the development of oil and gas resources will move further and further out there.  BC could help by extending the grid to Yukon.

Northern Cross touts solution to Yukon’s energy pinch
Wednesday June 16, 2010  by John Thompson
As far as fossil fuels go, it’s cheap, clean and plentiful.
If Northern Cross has its way, the stuff will help power Yukon’s next generation of mines. It may even one day help propel the trucking fleet that carries goods up the Alaska Highway.
It’s natural gas. There’s an estimated 5 trillion cubic feet of it beneath Eagle Plain, and Northern Cross, a small, privately-held Calgary company, wants to pump it to the surface, chill it to minus 160 degrees Celsius so it condenses to liquid, and truck it to energy-hungry mines within the territory.
“There’s a large need for additional energy, especially with a growing mining industry, and we’d love to service that industry with clean-burning natural gas, if we can,” said president Brian Avery.
On Friday the territory announced that Northern Cross won the right to explore 49,000 acres of property in Eagle Plain, just shy of the Arctic Circle, after pledging to conduct $615,100 in exploration work over the next decade. Oil and gas dispositions are given to whichever company pledges to commit the most work.
The new disposition completes a patchwork of properties already claimed by Northern Cross. All in, the company has rights to explore nearly 1.3 million acres of Eagle Plain Basin. It has pledged to conduct a total of $21 million in work.
Next step: before exploration begins, the company needs to raise between $50 million and $100 million.
“Financial markets have been a little shaky lately, to say the least, so we don’t have the wherewithal to do exploration yet, but we’re hoping that will come together in the next few months,” said Avery.
If financing falls into place, Northern Cross plans to sink a dozen new wells, starting early next year, and to explore four existing wells that were drilled in the 1960s and 1970s.
The operation would employ approximately 100 workers at any given time, said Avery.
The company’s first three drilling licences have already cleared Yukon’s regulatory hurdles. This work would all be done immediately adjacent to the Dempster Highway.
Northern Cross already has its drilling rig in place at the old Camp 204. Next, it plans to move a 46-person camp up from Fort Nelson.
When Northern Cross formed in 1994, its focus was on pumping oil from Eagle Plain to sell to Yukon customers. In 1998, after spending $2.5 million, the company produced a few hundred barrels of crude, which was shipped to Whitehorse and fed to Yukon Energy’s diesel generators.
But a shrinking territorial economy, following the Faro mine’s closure, put the company’s plans on ice.
Since that time natural gas has become a more attractive commodity. It is 25 per cent cleaner than burning oil, and about that much cheaper. Once liquified, it takes up a small fraction (1/600) of the volume of natural gas.
Northern Cross still hopes to extract crude—the new plan is to truck it to Fort Nelson for distribution. But the company’s new focus is on selling liquified natural gas to Yukon’s next cohort of mines.
The territory’s hydroelectric grid is currently under strain. The addition of a new turbine near Mayo will help keep pace with consumer demand, but there won’t be enough capacity to feed a new mine.
Western Copper Corporation, for one, envisions a mine at its Casino project that would be powered with liquified natural gas, known in the industry as LNG. The company currently expects to be fed the fuel from a nearby port.
Avery’s operation, if it succeeds, would offer LNG closer to home, at lower costs.
Northern Cross’ pitch coincides with resurgent interest in natural gas in North America, driven by new technologies that allow companies to extract gas from previously unreachable shale deposits.
Natural gas proponents tout the fuel as a replacement for dirtier diesel. That’s led to a drive to refit North America’s trucking fleets to run on LNG. Such fleets are not uncommon in Europe but are a rarity on this continent, for lack of refuelling facilities.
The state of California is leading the push. It has more than 450 natural gas refuelling stations, and it plans to ban diesel trucks from hauling goods from the state’s two largest ports by 2012.
In Canada, EnCana Corporation wants Ottawa to help it build a chain of liquid natural gas fuelling stations between Windsor and Quebec City. The company boasts that converting just one heavy-duty truck to LNG would be equivalent to taking 325 cars off the road.
But the widespread adoption of LNG faces many obstacles - popular fears of a massive explosion being just one.
But Avery notes that liquified natural gas has been safely extracted and transported in Alaska for several decades. Alaska has shipped LNG from the Kenai Peninsula to Japan since 1969. And, since 1998, trucks have hauled LNG to Fairbanks Natural Gas’ storage facilities. From there, LNG is converted back into gas and distributed to homes and businesses.
“It’s very much proven technology,” said Avery. It’s almost like trucking propane around.”
The company faces more challenges than fundraising in tight times. Its drilling grounds overlap with two conservation controversies: the migration route of the dwindling Porcupine caribou herd and the boundaries of the Peel Watershed.
Northern Cross plans to stop drilling when caribou are nearby to avoid spooking the animals. Avery also asserts that the herd usually doesn’t venture as far south as where the company plans to begin work.
An eight-hectare slice of one property encroaches into the Peel. The territory granted the disposition, despite a ban on exploring for minerals, oil and gas in the region until February of next year.
No surface access will be allowed on the Peel lands while the ban is in place.
Karen Baltgailis, executive director of the Yukon Conservation Society, acknowledges the overlap is small, “but we still find this is inconsistent with the spirit and intent of the moratorium. To me, it seems the message that the Yukon government is sending is, ‘We’re not serious about the Peel planning process.’”
The territory is currently mulling over a proposed regional land-use plan for the Peel. The finished plan will determine which activities will be allowed in the overlapping area. Whatever the outcome, “We’ll govern ourselves accordingly,” said Avery.
Contact John Thompson at

Wednesday, June 23, 2010

The Tar Sands

Energy sources are really all about the price it costs to get the energy needed to do something.  The economics of supply and demand are big feature of energy prices.   A low supply means a high price, a high price means more people looking for supply to meet that demand.

There are constant concerns about the idea of peak oil, that we will run out of available oil and that society will suffer for it.    This analysis ignores several important factors.

As the price of oil rises the amount of oil in the ground that is economic to recover rises - an increase in supply
As the price of oil rises, other energy sources become more affordable - a change in energy source
As the price rises more people spend more money on finding cheaper ways to extract more oil.

A rising price of oil will make the market conditions for the globe to use less oil.

The Tar Sands in Canada are the one major source that increases constantly.   As the price rises the amount oil they can afford to recover increases.   Also each year through innovations the cost to extract oil goes down.   Canada's oil reserves are going to grow ever faster.   As they grow, investment win the tar sands will rise.

The only answer to the demand for the tar sands oil is for other energy sources to become significantly cheaper and reduce the global demand for oil.   The idea that one can stop it through boycotting or regulation is not realistic and takes time and energy away from the real solution.

The change will come when motor vehicles are driven by electrical power and electricity is produced from green sources.   Society was dependent on biomass (wood, peat, charcoal) as a primary energy sources for thousands of years, the only other one available was human and animal energy.   When coal came about these older energy sources no longer provided the main energy for human society.

Oil will fade when we adopt something cheaper and better, that is when the tar sands will fade away

Tuesday, May 18, 2010

Some thoughts about Site C

Original version published in 24 hours on April 22nd

Recently the government announced the go ahead for the Site C dam on the Peace River. This is the first new major dam in North America in a generation, large scale dam building is something from the time when cars had fins and TV was black and white..

Site C is put forward as the great answer for power self sufficiency in BC. Certainly 4600 GWh per year is good, enough to provide power to over 400,000 houses. But there are downsides, the biggest of which is the flooding of close to 14000 acres of land along the Peace River. How big is that? Imagine 14 Stanley Parks. Site C also means the citizens of BC will be on the hook for at least $6.6 billion in new BC Hydro debt.

Site C is not the only option we have in BC, there are better private sector answers available. How does Site C compare to a private green energy project?

The Plutonic Power Bute Inlet project will produce 2900 GWh per year, about 2/3s the capacity of the Site C. This project will directly impact less than 50 acres of land, which is good because more flooded land means more CO2 from a reservoir. The roads needed are already there because of logging, though they will need new transmission lines. The Plutonic project will cost $3.5 billion and citizens will not be on the hook for a penny of it.

Site C is not the best option for BC, but will it even manage to go forward?

The first hurdle is the environmental assessment. This process is rigorous and demands a lot from proponents but is is a process misunderstood by the public. Of the roughly 200 projects that have entered the EA process it is true only one was refused a certification, but that does not mean every other project was approved. The reality is that proponents either withdraw from the process or stop if the environmental requirements become too expensive. About 40% of projects that enter the EA process do not get approval. The process is certainly not a rubber stamp.

The EA process assesses environmental impacts and then sets goals to mitigate the impact of the project. The Achilles heel of the Site C dam is the loss of close to 14,000 acres of land in the Peace River area, of which 8000 is some of the best farmland in BC. How do you mitigate that damage? What action can BC Hydro take to remove this one huge impact on the environment? The loss of this land would be the biggest loss of agricultural land since 2000.  Would the Agricultural Land Commission North Panel even allow the land to be removed from the agricultural land reserve?

Even if through some improbable miracle Site C were to manage to get EA certification, I am not sure how any government would be able to weather the political storm that would come from North America wide opposition to building the dam. It will end up costings us hundred of millions to plan and consult about a dam that will never be built.. The time to stop this waste of money is now.

Thursday, May 6, 2010

The Green Energy Taskforce Report

I have to say underwhelmed is the best I can muster for the Green Energy Taskforce Report.   They had a mandate to provide recommendations on all aspects of green energy production in BC and they produced a document that is more platitudes and motherhood statements than any sort of detailed recommendations.

Here is one of the recommendations:

2. Increase Clean Electricity Demand in B.C.
Growing a low-carbon economy means attracting new investment to B.C. that can be supplied by B.C.’s clean electricity. Clean technology industries, like data centers, could be incented to locate in B.C. to take advantage of data networks.
Recommendation 4: Bring the load/business/jobs to the electrons–actively recruit and attract new low-carbon industry (such as server farms for the Interior).

Where does one start with this?   First of all the recommendation is "Increase Clean Electricity Demand in BC" and not attract greener industries.   The two parts do not connect.   The only way to increase the demand for clean electricity is to remove the BC Hydro monopoly of sales of power so that consumers can choose where they get the power from.    The short paragraph and recommendation there make no sense in the context of green energy.  They do not say who should attract these business to locate in the interior BC or the other impediments to being there.

There are very few clear concrete recommendations within the taskforce report.  A number of the ones verging on having a clear direction are things that are already going on.

 Here is a list of the somewhat more clear recommendations I could find are:

  • Complete Revelstoke and Mica dam capacity for power generation
  • Move forward on Site C and Site E
  • Move procurement, generation operations, and export outside of BCUC regulation.
  • Develop a Lowe Carbon Transition Plan (though dates for when)
  • By September 30, 2010, and using existing data and information layers, develop a renewable energy zoning map for the Province that identifies where development of renewable energy and transmission is appropriate and inappropriate.
  • Direct BC Hydro to amend bioenergy electricity purchase agreements (EPAs) to transfer the biomass fuel price risk through to BC Hydro so that if biomass fuel prices increase, BC Hydro will correspondingly adjust the purchase price of electricity. (I do not like this one)
  • Establish a B.C.-owned Biomass Fuel Aggregator to access and aggregate woody biomass from provincial forest land, and supply fuel to bioenergy project developers.
  • Increase the Innovative Clean Energy (ICE) Fund from $25 million to $50 million with a commitment to review funding levels every two years. Restructure the ICE Fund with an expanded team of investment professionals and consider moving it outside of government as a separate, stand-alone organization.
  • Implement a royalty credit and/or tax credit program to provide the necessary incentives to industry to use clean energy technologies at remote installations in B.C., such as mining, natural gas operations and communities.
  • The Province should develop a regional green energy planning process
  • The Province should expand the current revenue sharing model to include the sharing of revenue collected by the Province with First Nations on all types of green energy.

Even this list find is full of statements that are really not offering much.   What I was looking for was something with a lot more specifics.   I was looking for detailed background on each recommendation including deadlines and how the recommendation should be implemented.  All in all, the report is short enough on details that it could be used to justify almost any action in relation to green energy in BC.

There are other recommendations that many will say have specific actions for government, but I would argue they are too vague or they are not realistic in BC.

The submission I made to the taskforce had some very specific recommendations with details of what should be achieved and by when.  It also contained a lot more details with respect to scope and scale of power production now and in the future, prices for power here and elsewhere, specific issues with the grid, and where new green power could accessed without building any significant infrastructure.   I am only one person and working on that on the side of my desk.  They taskfroce report does not impress me.

Tuesday, April 13, 2010

Where we sit one third of the way through 2010

I have to say that I am convinced that there is clearly something going with respect to climate, that there is a warming trend happening that is occurring very quickly. I am also convinced that human activity is having an impact on this and that if there were a reduction in green house gases the warming trend would be slowed and the climate would be more stable.

I did not jump on this bandwagon in some sort of fear of an impending Armageddon. What ever happens, the world will survive, it has survived much worse in the past. The issue really is what will it cost to mitigate climate change and is that expense worth it? Can we afford to make changes? Can we afford not to?

Climate change has been in the headlines for two decades now. There is clear evidence of the rising CO2 levels and the source of the CO2. But the world is acting as if it is not happening or freaking out as if the world is going to end. There is very little serious long term thought and planning happening with respect to the issue. The issue has also been high-jacked by the left as a way to attack the capitalist system and by the right as a way to galvanize their supporters against the left.

I am going to look at the social and economic aspects of climate change in the context of where we are now and what is likely to happen. I am not going to focus on the environment as the majority of the public shows over and over again that in financial terms they are unwilling to part with much money for the environment.

So here in early April 2010 where can go?
Do nothing - this would seem to indicate increased temperatures and over time some major economic and social dislocation. It is survivable and ultimately the most dislocation would be felt in regions near the equator. In the case of Northern Europe, Russia and Canada, for generations to come the net impact of global warming will be positive for the economy. Ultimately there is no way this direction will be allowed to happen.

Dramatically restrict parts of the economy - Prying people out their cars is not going to happen. Getting people to own less stuff is not going to happen. Adding large costs to industry is not going to happen. The anti-capitalist left approach to the issue is doomed to failure as an approach and will mean a delay of action of any sort.

Government regulation - This is what we seem to be doing the most of at the moment and the law of unintended consequences is hard at work. Cap and Trade is not having any effective impact on CO2 levels being emitted, in fact I would argue it is slowing the movement in the direction of any success in dealing with CO2 levels. The bio-fuel bonanza caused food prices to skyrocket.

The IPCC - they exist, but they remind me of the worst aspects of committee decision making. The reports they issue leave a lot to desired and take much too long to write, though they have been the source of much good data. There are areas that the IPCC is not looking at that it should be considering, biggest of these is economics. The IPCC needs to have their reports include the economic costs of actions and no action. The central question that no one is answering - is it economically better to act now or in the future?

To date there has been very little done to actually reduce CO2, and other green house gas, emissions. There may have been some slowing, but there is no reduction in green house gases. What we have been doing for the last 20 years has not been working, it has been effectively a waste of time and energy.

In a rational world we would make long term goals and create plans to meet them, but the problem with this is that there is that tendency to put off to tomorrow. Goals are not the right direction, there needs to be some other mechanism. Ideally any mechanism would be a price based mechanism that need little or not government regulatory input. The simplicity of a market based price seems to be the only way something significant could happen.

The goal of cap and trade is to set a price for CO2, but it is much to heavily influenced by government regulatory mechanisms and a lack of ways to monitor if it is really working. The pricing mechanism has to be one that is clearly included early on in the decision making process of any business venture. The simplest method would seem to be a carbon tax.

Carbon taxes are being resisted in many places and the political backlash has been severe enough to make governments think twice before going down that path. A tax the public can see is unpopular even if it is cheaper and better than an alternative pricing mechanism. The problem is how do you get the public to demand a carbon tax?

As we are going at the moment, there is almost zero chance that any concrete reduction of emissions will occur within the next ten to twenty years. Being able to change this is going to hard and is not served at all by people saying we should not drive, we should live in a smaller house, we should not aspire to be wealthy. Change will happen when we can show businesses will make more money through being carbon neutral, that the public will be able to travel more cheaply in the future, and that more goods will be available at a lower cost.

Change is also not served by ignoring the rising emission levels in Asia and Africa. BC could build all of the planned, proposed and possible green energy projects in the province and it would still not equal what China is adding each year in coal power. Why should Canada bother if Asian economies will not reduce their green house gases as well?

I would say the UN needs to deal with the issue, but I have little faith in them being able to do anything quickly or effectively. There needs to be some sort of statement of values from the largest economies with respect to climate change, things like setting a price for emissions through taxes or affirming higher wealth and consumption by the public. They need to be statements that allow the public to understand there are ways to manage climate change and be better off for doing it. The public needs to know that they have a brighter future and are not going to have to do with less and flagellate themselves.

Thursday, March 18, 2010

Electrical Production in BC

BC is consistently needing to import electrical power. In 20 of the last 25 months BC has had to import power to meet the demand in BC. We seem to about 4,000 GW/h short per year of the power that we need.

The imported power is a mix of gas fired, coal fired and nuclear power. By not being able to even meet our own needs, we are increasing the demand for CO2 source electrical power. The power we had to import added 2.5 million tonnes in CO2 emissions in 2009, this does not count the need to run Burrard Thermal in the lower mainland.

The scope of scale of what we need in BC is larger than the Plutonic Energy Bute Inlet project, the biggest green project currently contemplated. The Bute Inlet project will only bring in 2900 GW/h per year. We are not only short, but we are falling further behind each year as our population grows.

Growth in demand will add the need for about 1500 GW/h per year. We need to build a Bute Inlet scale project every other year just to keep up with demand. If we want to get ahead of the the problem and become one of the major sources of a climate change solution we need to dramatically increase the speed at which more green power is brought online.

The opposition to green power production in BC does not seem to be related to any quantifiable environmental issues, it seems to be related to the fact that a Green Economy means businesses are going to be making money from saving the world. The opposition to green power in BC is harming the environment.

If I did not believe in conspiracy theories I would think that the opposition to green power in BC was some sort of funded campaign by the coal business. I find it crazy that the opposition to green power seems to be willing to ignore all the evidence in favour of environmental harm. The data is in, BC does not come close to producing enough power to meet our needs.

I continue to read all the websites and all the reports that relate to non storage hydro and I have to find anything that indicates a measurable environmental harm form non storage hydro. If anyone out there knows of a report that shows environmental damage, please send it to me.

Tuesday, February 9, 2010

Energy in the Throne Speech

The throne speech was read today and it highlights some energy issues.

I am encouraged by the clear support for more green power. I am also happy to see continued support for the Highway #37 powerline. The government is placing itself at the forefront of clean energy production in North America, this sets us up to gain a lot of jobs, reduce CO2 emissions and add to government revenues. All pluses.

I am looking forward to see the what comes out of the Green Energy Taskforce and what the new Clean Energy Act will look like. We are at the forefront of a paradigm shift here in BC with respect to energy.

Here is the section of the Throne Speech

Clean energy is this century's greenfield of opportunity.

British Columbia is blessed with enormous untapped energy potential.

We can harness that potential to generate new wealth and new jobs in our communities while we lower greenhouse gas emissions within and beyond our borders.

Clean energy is a cornerstone of our Climate Action Plan to reduce greenhouse gas emissions by one‑third by 2020.

Building on the contributions of the Green Energy Advisory Task Force, your government will launch a comprehensive strategy to put B.C. at the forefront of clean energy development.

We have enormous potential in bioenergy, run‑of‑river, wind, geothermal, tidal, wave and solar energy. We will put it to work for our economy.

A new Clean Energy Act will encourage new investments in independent power production while also strengthening BC Hydro.

It will provide for fair, predictable, clean power calls.

It will feature simplified procurement protocols and new measures to encourage investment and the jobs that flow with it.

New investment partnerships in infrastructure that encourage and enable clean modes of transportation, such as electric vehicles, hydrogen‑powered vehicles and vehicles powered by compressed natural gas and liquid natural gas, will be pursued.

We will support new jobs and private sector investment in wood pellet plants, cellulosic ethanol production, biomass gasification technologies and fuel cell technologies.

Bioenergy creates new uses for waste wood and beetle‑killed forests and new jobs for forest workers.

A new receiving license will give bioenergy producers new certainty of fiber supply, while a new stand‑as‑a‑whole pricing system will encourage utilization of logging residues and low‑grade material that was previously burned or left on the forest floor.

Government will optimize existing generation facilities and report on the Site C review this spring.

It will develop and capture B.C.'s unique capability to firm and shape the intermittent power supply that characterizes new sources of clean energy to deliver reliable, competitively‑priced, clean power — where and when it is needed most.

New conservation measures, smart meters and in‑home displays will help maximize energy savings. New smart grid investments and net metering will provide more choices and opportunities for reduced energy costs and more productive use of electricity.

New transmission investments will open up the Highway 37 corridor to new mines and clean power.

New transmission infrastructure will link Northeastern B.C. to our integrated grid, provide clean power to the energy industry and open up new capacity for clean power exports to Alberta, Saskatchewan and south of the border.

We will seek major transmission upgrades with utilities in California and elsewhere.

If we act with clear vision and concerted effort now, in 2030, people will look back to this decade as we look to the 1960s today.

Friday, January 29, 2010

Orinoco Oil Sands

While everyone is jumping up and down about the Athabasca Tar Sands, few people are making much fuss about the Orinoco Oil Sands in Venezuela. The estimates of how much oil could be recovered at today's prices and technologies is between 235 billion barrels to 513 billion barrels. This is significantly more than the Athabasca Tar Sands

At the moment there is about 600,000 barrels a day coming from this source and at a cost that is much lower than the cost of the Canadian tar sands. This about half of what is produced in Canada. I find that fact interesting because of the gap between Canadian per capita CO2 emissions and those in Venezuela. I think that the numbers for Venezuela are not correct because on a per capita basis the Canadian tar sands are only 55% larger than the Venezuelan oil sands.

The problem is that this oil source is in Venezuela and therefore under a government that is immune to local or global public opinion. Further complicating this will happen if the Chinese express an interest in getting oil from this source. Without a free press or a public that is allowed to speak out, it is very likely that we will see a huge environmental disaster happen in Venezuela as these oil sands are developed. Odds are we will not find out about this till long after it has happened.

Canada has serious first world environmental standards. Venezuela has the environmental standards of a dictatorship, which is to say there is nothing that will be enforced if they had anything on the books to start with.

Venezuela claims to have 35% protected areas, but these areas are logged and mined. Hugo Chavez should be the global poster child for environmental disaster.

Wednesday, January 27, 2010

Canada and the environment: A fresh start for a fresh decade by Preston Manning

This is an interesting opinion piece from Preston Manning about the environment from a conservative perspective. When I was young, he was one of the barbarians at the gate, but as time goes by there are few people in Canada as thoughtful and open minded as he is.

This is quote from the piece:

Grounds for more productive dialogue and action on the environment do exist among those Canadians who share the following convictions: (1) That it is a good idea to reduce the negative environmental consequences associated with the production and burning of hydrocarbons, regardless of whether you consider global warming to be one of or the most serious of those consequences; and (2) That the choices required to address our environmental challenges are not polarizing and divisive “either/or” choices – either regulatory action by government or market based initiatives by business – but unifying and consensus-building “both/and” choices.

His seven points on routes on the way forward are a good reflection of the different options towards solutions, but he is correct to say no one route will be the answer and that all of them need to be embraced

  1. Full Cost Accounting
  2. Science, Technology, and Innovation
  3. Market mechanisms
  4. Government Policy and Regulation.
  5. Demand-Side Transformation.
  6. New Eco-Partnerships.
  7. Political Leadership at the National Level
Having Preston Manning come forward on this issue in this manner will make the environment a more palatable issue for the right in Canada

Friday, January 22, 2010

Non-Storage Hydro aka Run of the River

Non storage hydro is also referred to as run of the river and micro hydro. It is the best term to describe how the power is generated. The main aspect of non storage hydro is not size of the project but the fact there is no way to store water for production of power. The use of the term microhydro is not an accurate term and neither is run of the river.

Storage hydro facilities work on the idea that a large reservoir can store water for year round consistent power production on a large scale. The spring run off will take the reservoir to full pool and then the level is drawn down over the year as needed. The reservoir acts as a system to store the power until it is needed.

Non storage hydro has no capacity to retain water for later dates, it has no capacity to store power. This means that at the moment non storage hydro can not by the sole source of electrical power as the amount of power that can be generated varies during the year. When looked at in isolation, a specific project could have periods when it can not produce energy and therefore can not be considered firm supply on an ongoing basis. This all changes once there are a large number of sites throughout different parts of BC.

Non-Storage Hydro is the Internet of Electrical Production
The internet functions well not because any one part of this global network can carry all of the traffic all of the time, but because it is a system with thousands and millions of different nodes and routes and thereby allowing the internet to function well even if parts of it are down. This is the analogy one needs to think of when considering non storage hydro in BC. The overall generating capacity of non storage hydro in BC evens out as the number of generating sites operating increases. With more generating sites the electrical system can rely on more non storage hydro as firm capacity over the whole year.

BC has an abundance of locations on the coast for non storage hydro and the consistent year round rain fall to ensure year round generation in the vast majority of locations. Spring run off can occur from late March through to mid July in different areas of the province. Some people are concerned that non storage hydro sites can only provide power for part of the year. The data does not back this up.

Non Storage Hydro has very low CO2 Emissions
Non storage hydro has a very low carbon footprint, the lowest of any of the electrical production options available. The ongoing production of power from the facility has a very low CO2 output, mostly to do with the movement of people to and from the facility resources needed to maintain it. In some cases increased plant growth around the head pond may be enough to offset the ongoing CO2 contributions. The largest contribution of CO2 emissions comes from the construction of the facility.

The nature of the coast of BC and the needs of non storage hydro are well suited. Non storage hydro needs a decent year round water flow and steep inclines to provide a good head for the turbines. By their nature, the best sites for non storage hydro projects are in locations that are of lower values for wildlife and fish. In many cases, there are no fish near the project locations and the impact of the facility is not measurable downstream.

Energy Payback - Nothing is Better than Hydro
An important aspect of all energy production to be considered is the energy payback ratio – how much energy is generated for each unit of input energy. All hydro has a very high energy return rate, by far the best of any electrical generation. For a large scale storage hydro system the energy payback ratio is about 240 times as much energy is produced as was used to build and operate the facility. For non storage hydro this ratio is about 220 times. For fossil fuels it is only 1 to 7 times as much energy is produced as what is needed to build and operate. After hydro, the next best energy source is wind power at about 20 times the output when compared to the input. These numbers come from a July 2005 Hydro Quebec report by Luc Gagnon, there are other sources out there that confirm these numbers.

An energy payback of less than 1.5 means the system uses almost as much energy as it generates. Conventional coal fired power plants with CO2 capture and sequestration can be as low as this. This fact alone makes the idea that there will be a move to CO2 capture and storage by the coal fired power plants in North America unrealistic in the next 15 years.

BC has an Abundance of Sites
In 2007 there was a report by Kerr Wood Leidal on potential non storage hydro locations in BC. The report identified numerous ones with a combined annual generation of 50,000 GWh/yr. The report is a a useful ballpark to allow us to see what may be possible but it should not be taken as the final word on what is out there. The report missed out on many sites that are currently either in the planning stage or under development, the biggest example of this is the Plutonic Power Bute Inlet project.

The report was an overview of the province and made some assumptions that have not are not realistic, chief among them being that projects would not cluster and share infrastructure costs. The report was not able to make detailed and through design plans for each location and thereby missed many potential sites that are now under consideration.

As an example, Hawkeye Energy Corporation has identified and applied for 350 MW worth of sites for non storage hydro in less than one year. These sites have a potential for 1310 GW/h of generation. Many of their sites are located close to the Plutonic Power Bute Inlet project. As more projects are built and more infrastructure is there for them, the easier it is for smaller projects to piggy back on the infrastructure.

What we can take from the report and other sources is that BC has the capacity to develop more than 50,000 GWh/yr of non storage hydro over the next 15 years.

Non storage hydro has one more major advantage over almost all other green electrical generation technologies. Non storage hydro is economically viable now without any sort of market distorting government subsidies.

Tuesday, January 5, 2010

Our low electrical rates cause more CO2 emissions

The power we generate in BC is low in CO2 emissions, but the grid we are part of, the Western Interconnection, is not. As long as we have electrical rates that are artificially low, we will use more power than we need. In recent years BC has normally used more electricity than we generate. The extra power we need comes from gas or coal fired power from elsewhere in the west.

Building more capacity is one way to reach electrical self sufficiency by 2016, but reducing demand would achieve this as well. Once we produce more electrical power than we consume we can export the excess green power to others in the west.

If BC were to charge higher rates for power, the public will be much more motivated to conserve power. Higher rates will also mean that more green energy sources will become economically viable without needed market distorting government subsidies.

The current price BC Hydro residential customers pay is $0.0591 per KWh for the first 1350 KWh in a two month period and then rising to $0.0827 for any power used over that amount. This is an average cost for a suburban home of about $0.065 a KWh. People in the BCFortis service area pay $0.07627 per KWh. These rates are the lowest any residential customers pay in the Western Interconnection.

BC should have a policy that the price of electricity in BC reflect rates in neighbouring markets. A mix of rates from Washington, Alberta, Idaho and Montana would make for a good basket
  • Washington – $0.086
  • Alberta – $0.089 average
  • Idaho – $0.086
  • Montana – $0.099

Average of the four = $0.09 per KWh

It is not unreasonable for BC to want to retain a competitive advantage, so reducing the cost by 10% of the average makes sense. Doing this gives us a price of $0.081 cents per KWh. This is still the cheapest power in the Western Interconnection but significantly higher than what we pay now. This higher price will quickly make conservation measures economical by making pay back times for the work less than three years.

The higher price should actually reduce demand for power in BC over a period of several years as people adjust to the higher price and change their habits to save money. We should see a leveling of total provincial demand for several years and then see a slower rate of increase than what has occurred in the last twenty years.

If we consume less power in BC there is more green power available for the rest of the Western Interconnection. By 2025, this should allow for BC to be using 10,000 to 15,000 GWh/yr less than it would without the price increase. That is enough power for between 750,000 and 1,250,000 people in California

Monday, January 4, 2010

The Carbon Tax should be a CO2 Emission Fee

Carbon tax is not really a good term, in reality this should be referred to as a CO2 emission fee. There is a need to connect the value of the revenue raised to the purpose for which it is used. If we shift to a CO2 Emission Fee and base the fee on the cost to capture and store the CO2 emissions, then there is a clear benchmark for the price that should be set for the fee.

The correct level to set a carbon tax at is one that reflects the cost of mechanical removal of CO2 from the atmosphere. Only mechanical removal makes any sense because it is can be empirically measured and verified. Many carbon offsets are for projects that would happen anyway or are in locations where it is impossible to verify compliance.

BC has the start of an agency that could capture and store CO2 - the Pacific Carbon Trust. With enough resources, the Pacific Carbon Trust could be a major player early on in co2 capture and storage.

What is the cost of capturing CO2? At this time it seems that the cost is about $65 per tonne to capture and store CO2. This price would indicate that BC should be aiming for a carbon tax of about $70 per tonne to ensure enough taxes are recovered to pay for capture and storage of all the CO2 emitted by fuels in BC. This would mean a carbon tax of close to 17 cents a litre on gasoline.

17 cents a litre is a significant rise from where the tax is now, but adding two more years of phase in to the carbon tax BC could be at 17 cents a litre by 2014. This level of fee could fall over time as the price to capture and store carbon falls. As an industry develops and innovates, it is realistic to expect the price to capture and store CO2 falling to $40 per tonne by 2025.

Linking the fee to the amount of CO2 emissions means the government could set up an opt out system for companies or people that capture and store their own CO2. The Pacific Carbon Trust would monitor the opt outs. Allowing the opt out will encourage even more innovation in CO2 capture and storage and bring down the costs faster.